When launching an Asia hedge fund, expect a budding but crowed space
In last month's issue of NewManagers (p.26), we mentioned a Preqin
survey that claimed that Asian investors are not as shy as their Western
counterparts when it comes to investing in new hedge fund managers.
Indeed, 58% of investors in the region are apparently prepared to invest
in new funds, compared to 39% of European investors and 48% in North
America. Asian investors were generally less affected by the downturn than
those based elsewhere, which could explain their continued, and indeed
increased confidence in such funds, said Preqin, a provider of intelligence
on the alternative assets industry.
Opalesque did some further investigation into the matter of Asian
investors, new managers of Asia funds (international and Asia-based), and
international investors in Asia funds.
The first impression was that, Asia-focused hedge funds did just as well -
if not better at times - as their other geographical counterparts, and a lot of
international players are either setting up Asia funds or are investing in Asia
funds to take advantage of the regional opportunities.
Asian investors themselves, however, do not invest so much in Asia hedge
funds as they have more of a trader-like approach and prefer investing
short term either directly or through domestic funds - usually long-only
funds, to ride on the bull market. The environment is good enough for that
despite the high volatility. Although wealthy Chinese investors are now
turning to "sunshine" private trusts (Chinese version of hedge funds) as the
property market cools, stocks slump and bank-deposit rates fail to match
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This article was published in Opalesque's New Managers
a top-down monthly analysis, news and research publication on the global emerging manager space.