Assets managed by Asian hedge funds may exceed $180 billion in the next 12 to 18 months as the region’s growth attracts investors amid U.S. economic and Europe sovereign debt concerns, according to Eurekahedge Pte.
Asian hedge-fund assets stood at $134 billion at the end of June, compared with $14 billion at the start of 2000, according to an e-mailed report by the Singapore-based industry researcher. The number of funds has grown eight times to 1,235 since 2000, the report said, citing increased popularity of hedge funds and the easing of regulatory restrictions in the region.
Investors seeking to capture the economic expansion in Asia are helping the growth of hedge funds in the region, which still only account for less than 10 percent of the global industry, according to Eurekahedge.
“Struggling political and economic environment” in the U.S. and Europe combined with lighter tax burdens in some Asian countries will lure more money to the region’s hedge funds, the report said.
“The Asian hedge funds industry continues to be one of the most exciting and fast-moving sectors of the global hedge fund industry,” Eurekahedge said in the report. “The region continues to develop at a fast pace with new funds starting up and employing an increasing number of different strategies and geographical mandate.”
Long-short equities funds that bet on rising and falling stock prices make up 44 percent of Asia’s hedge funds, followed by multistrategy, which invests in everything from equities to commodities, accounting for 15 percent, the report said.
Asia ex-Japan hedge funds have had the best annualized return since December 1999, up 13 percent, the report said. Returns for the region, including Japan, stood at 9 percent, while North American funds had 11 percent and European funds returned 9 percent, it said.
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