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Komfie Manalo, Opalesque Asia: Another China-focused hedge fund firm has outperformed in 2015, with MegaTrust Investments reporting that its flagship fund Yangtze Fund II returned 10.5% in 4Q15 and 59.6% last year compared to the CSI 300 Index which gained 5.6% and the MSCI China A Index which was up 12.2% during the same period.
According to financial data provider Wind, Yangtze’s 2015 performance ranks among the top 5% of its peers, and the fund’s five year track record is within top 1% of the Chinese fund industry.
Charlie Chen, Chief Investment Officer at MegaTrust commented, "The A-share market rebounded strongly in 4Q15 after one of the worst quarters in history. The CSI 300 Index was up 16.5% in 4Q15 following a 28.4% decline in 3Q15. Despite the market’s rally last quarter, we maintained a relatively cautious stance and had an average cash level of 50% (40% at the end of 4Q15). This is well above our normal cash level of 20% historically."
Chen explained that after the turbulence in July and August of 2015, the fund decided it was time to de-risk the portfolio in 4Q15, because it was not worthwhile to expose the fund to such high volatility.
Chinese hedge funds in wait-and-see mode
Following the summer market turmoil, QuantCore Capital Management executive Dr. Martin Lockstrom said that most China-focused hedge funds adopted a wai...................... To view our full article Click here
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