Tue, May 31, 2016
A A A
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. Americas - Australian banks sending U.S. hedge funds broke, Ryan Puerto Rico ‘rescue’ bill could be windfall for hedge funds[more]

    Australian banks sending U.S. hedge funds broke From SMH.com.au: US hedge funds are not having the best of years. Profits are hard to find, they're underperforming and the punters are losing patience, withdrawing US$15 billion ($20.8 billion) in the March quarter. They're expected to wit

  2. Investing - Billionaire Wilbur Ross likes the look of Chinese bad loans, Hedge funds are still relevant in a diversified portfolio: 4 fundamental criteria for superior manager selection[more]

    Billionaire Wilbur Ross likes the look of Chinese bad loans From Bloomberg.com: U.S. billionaire Wilbur Ross said he’s considering investing in nonperforming loans in China, as Moody’s Investors Service said that the nation has the tools to prevent a financial crisis in the near term. I’

  3. Investing - Blackstone gives pricey Canadian energy and property thumbs down, One of the most concentrated hedge fund bets is getting crushed, Facebook is hedge funds' new tech darling,[more]

    Blackstone gives pricey Canadian energy and property thumbs down From Bloomberg.com: Canada’s energy assets are uneconomic and real-estate markets overvalued, making them less attractive for investment than in the U.S. and elsewhere, according to Tony James, president of Blackstone Group

  4. Study - Only 30% of institutional hedge fund portfolios beat the benchmark[more]

    Bailey McCann, Opalesque New York: A new study from CEM Benchmarking, an independent provider of cost and performance analysis for pension funds, shows that only 30 percent of institutional investors hedge fund portfolios beat the benchmark after fees. The study provides in depth analysis of real

  5. Opalesque Exclusive: $1bn hedge fund club grows to 668 managers, continues to dominate (Part One)[more]

    Komfie Manalo, Opalesque Asia: Despite an underwhelming 2015 and a slow start to 2016 in terms of performance, one group of managers that continues to dominate the assets of the hedge fund industry is the so called $1bn club – hedge fund managers with at least $1bn in assets under management (AU