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Asia Pacific Intelligence

Asia Pacific hedge fund news for February included:

Friday, March 08, 2013

ASIA

A new firm is offering extensive due diligence and business information across Asia. Opalesque reported that Asiagate provides a searchable database of nearly 13 million business records, from China to Vietnam. Other countries covered include Hong Kong, India, Indonesia, Malaysia, New Zealand, the Philippines, South Korea, Taiwan and Thailand.

Some38% of hedge fund investors in Asia Pacific seek exposure to long/short equity hedge funds according to Preqin's Hedge Fund Investor Profiles database. The next most common strategies are multi-strategy hedge funds and global macro hedge funds, each favored by 31% of the Asia-Pacific hedge fund investor community.

Eurekahedge reported that the Asian hedge fund industry started 2013 on much firmer ground than compared to previous years. The Eurekahedge Hedge Fund Index gained 9.79% in 2012 and total assets under management (AUM) in the industry were up during the year - currently standing at US$127.4 billion. The industry witnessed some tough times and fickle fortune since the financial crisis and over the last five years the sector has faced numerous challenges.

Opalesque reported that Mesirow Financial Hong Kong Limited, a subsidiary of Mesirow Financial Holdings, Inc., is pushing ahead with its expansion into South Korea and North Asia with the creation of a client service and business development position for the firm's hedge funds group, Mesirow Advanced Strategies, Inc.

Opalesque reported that investors will seek out Asia and China-focused hedge funds this year, although AUM size remains a key criterion. Large strategies will likely be the biggest beneficiaries of inflows finds the 2013 Deutsche Bank Alternative Investment Survey.

More from Opalesque with news that investment management and investment services company BNY Mellon has released its market outlook for 2013, predicting that Asian hedge fund stars will continue to attract capital this year, despite challenges.

Hedge fund managers, traders and finance analysts are leaving Asia due to dropping income. Opalesque reported.

CHINA

Chinese shadow banking. Opalesque reported that China's "shadow banking" poses a threat to local banks as the latter are expected to foot the bill if ever the shadow banking system blows up.

Sino-foreign asset management joint ventures raise more money when the foreign partner is not active, finds Cerulli Associates.

A report from Asian Investor found that Chinese family offices are starting to emerge with fast-growing incomes making the mainland increasingly important as a home to wealthy private clients as well. "Increasingly, rich Chinese are considering setting up family offices to manage this capital, very often those who have generated their wealth from family businesses. They are most likely to establish one offshore, given domestic restrictions on inbound and outbound capital flows."

Opalesque reported that SEB's China Financial Index showed that China's economy bottomed out during the second half of 2012, and an increasing number of indicators now point to improved business conditions.

HONG KONG

AIMA Hong Kong welcomed the proposal of Hong Kong's Financial Secretary John Tsang to allow local open-ended investment companies. Phil Tye, Chairman of AIMA Hong Kong, said, "We believe that having a locally incorporated vehicle whose primary regulator is the Securities and Futures Commission is extremely important for local managers and potential new market entrants. We would like to express our support for the Financial Secretary and the Financial Services Treasury Bureau (FSTB) for their identifying this key initiative."

INDIA

India is set to launch 14 domestic hedge funds, with Livemint.com reporting that India may soon have as many as 14 domestic hedge funds managing some $1 billion in funds since the capital market regulator last year allowed the setting up of such high-risk, high-returns investment vehicles. At least 11 asset management companies have sought approval from the Securities and Exchange Board of India (Sebi) to launch hedge funds, according to its website, in addition to the three that have already secured permission. Till recently, Indian firms were not allowed to launch local hedge funds, though foreign hedge funds are allowed to invest in the country.

Indices

Emerging markets hedge funds posted strong gains to conclude 2012 which continued through early 2013, as stimulus measures in developed markets contributed to EM currency and equity market gains. The HFRX Multi-Emerging Markets Index gained +13.1 percent for 2012, including a gain of +4.8 percent in 4Q, with contributions across each of the BRIC (Brazil, Russia, India, and China) economies. Hedge fund capital invested in Emerging Markets increased by $11.2 billion during the fourth quarter of 2012 to a record of $139 billion (272 billion Real, 867 billion RMB, 7.5 trillion Rupee, 4.2 trillion Rubble, 521 billion Saudi Riyal) according to the latest HFR Emerging Markets Hedge Fund Industry Report, published by HFR, the established global leader in the indexation, analysis and research of the global hedge fund industry. Net capital inflows to Emerging Markets hedge funds exceeded $3.0 billion in 4Q12, the highest quarterly inflow since 1Q08.

Asian hedge funds, led by strong-performing Greater China and event-driven strategies, turned in a benchmark-beating average gain of 4.02% in January, according to a new Eurekahedge report. Managers beat the MSCI Asia Pacific ex-Japan Index, which was up 3.02% last month.

JAPAN

Opalesque reported that GLG, the discretionary investment manager of Man Group plc announced that the currency-hedged GLG Japan CoreAlpha Equity, launched in January 2010, has surpassed ‚1bn ($1.47bn) in assets under management.

State St shuts Japanese fund of funds. State Street Global Advisors' alternative unit SSARIS has announced it will close its Japanese fund of hedge funds on concerns about dwindling assets and poor returns.

Seeding

As announced in an exclusive interview in Asia Pacific Intelligence's December issue, Woori Absolute Partners, the Singapore-based alternative investment platform of Woori Investment & Securities, and NewAlpha Asset Management, the Paris-based global hedge fund incubation specialist, have announced the first strategic investment of the Woori NewAlpha Fund LP with Mosaic Asset Management Pte Ltd, a new Singapore-based registered fund management company, focused on Asian equity strategies.

THAILAND

Doug Barnett, president of Quest Management Inc reports that his Thai Focused Equity Fund is up 23.8% in the first seven weeks of 2013, putting assets in the fund up over its $250m benchmark. As a result, Barnett is moving to dealing D class shares from March 1st, with a 1% and 20% fee structure over a high water mark and on a six month, rather than three month, notice period only. Barnett was interviewed in Asia Pacific Intelligence in October.

 
This article was published in Opalesque's Asia Pacific Intelligence our monthly research update on alternative investments in the Asia-Pacific region.
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