Fri, Oct 9, 2015
Welcome Guest
Free Trial RSS
Get FREE trial access to our award winning publications
Asia Pacific Intelligence

Shanghai-based China focussed firm benefits from private equity

Monday, October 29, 2012

Earl Yen

Earl Yen is the founder of CSV Capital Partners, a China-focused alternative investment firm, based in Shanghai. CSV was

formed in 2004 and currently manages approximately $56 million in total AUM, of which 30% is from the founders/management.

The firm has two China funds, a private equity fund which has been running since 2007 with $45m under management and an equity long/short hedge fund, seeded with the founders' capital and launched at the beginning of 2010, now with assets of $11 million.

In an interview with Asia Pacific Intelligence, Yen says: "We trade mostly US and Hong Kong listed China stocks". Investors in the private equity fund are largely from North America, Japan and the rest of Asia, while the hedge fund's assets come 60% from the management team's own capital and the balance from investors in Europe and Asia.

"We manage a China focussed long/short equity fund and I think our roots in private equity have given us more of a deep research based, fundamental approach to reviewing Chinese companies. We do extensive local on-the-ground due diligence research and we have been doing it a long time in obscure private companies in China" Yen says.

"We have certain advantages compared with global funds that try to invest in Chinese companies without an on-the-ground team to do local reference checks and who can spot trends, frauds and new opportunities at an early stage."

Yen and his team prefer mid-cap Chinese companies listed in the US and Hong Kong and many of them are there because of previous private equity investments. "We tend to prefer mid-cap companies or smaller because these are the most under researched companies and they offer a lot of valuation inefficiencies."

Yen believes that the firm's "sweet spot" is under-researched small-cap and mid-cap equities, with a strong preference for faster-growing Chinese private sector companies selling to the domestic China market.

he firm has 14 full-time investment professionals in China. Since launch, the CSV hedge fund has outperformed the China equity indices, appreciating by 12.3% (net of all fees and expenses) during 2010, by another 3.5% in 2011 (the various China equity indices were down 20-30% in that year), and by 7.8% year to date through September 2012.

This article was published in Opalesque's Asia Pacific Intelligence our monthly research update on alternative investments in the Asia-Pacific region.
Asia Pacific Intelligence
Asia Pacific Intelligence
Asia Pacific Intelligence
Today's Exclusives Today's Other Voices More Exclusives
Previous Opalesque Exclusives                                  
More Other Voices
Previous Other Voices                                               
Access Alternative Market Briefing

  • Top Forwarded
  • Top Tracked
  • Top Searched
  1. Investing - AQR Capital and Renaissance Technologies raise stakes in Southwest Airlines[more]

    From In the previous part of this series, we saw how institutional investors played Southwest Airlines (LUV) in 2Q15. Now let’s move on to the trades executed by key hedge funds in Southwest Airlines over the same period. … Most of the hedge funds that had significant exposu

  2. Manager Profile - Pimco alternative funds flourish as 30-year bond rally fades[more]

    From Inside Pacific Investment Management Co., the bond behemoth that lost two chief investment officers last year and saw almost $500 billion of client money leave, a hidden profit engine is easing some of the pain. For more than a decade, Newport Beach, California-based Pimco has qu

  3. Niche Investing - Art investment funds: Attracting institutional and other new investors[more]

    From The Deloitte/ArtTactic Art and Finance Report 2014 (the "Art and Finance Report") noted that the "global art investment fund market was estimated to be worth at least $1.26 billion in the first half of 2014." This seems almost inconsequential when juxtaposed with the $54 billion of

  4. Hedge fund Barnegat survives September’s market selloff[more]

    Komfie Manalo, Opalesque Asia: Bob Treue’s $679 million Barnegat Fund proved resilient after another month of market letdown as the hedge fund gained 2.2% last month, bringing its year-to-date gains to 2.8%. Treue said in his monthly report to i

  5. …And Finally - Japanese men want upgrade on their virtual girlfriends[more]

    From Five years after News of the Weird mentioned it, Japan's Love Plus virtual-girlfriend app is more popular than ever, serving a growing segment of the country's lonely males -- those beyond peak marital years and resigned to artificial "relationships." Love Plus models (Rinko