Myriad Asset Management Ltd. and Azentus Capital Management Ltd. posted gains in 2012 as a market rebound in the last four months of the year helped Asian hedge funds outperform global peers.
The Myriad Opportunities Master Fund, a $1.4 billion multistrategy fund led by Carl Huttenlocher, former Asia head of Highbridge Capital Management LLC, returned about 7 percent last year, said two people with knowledge of the performance. Azentus’s $1.7 billion multistrategy fund reversed earlier losses to post a gain of about 1 percent for the year, said two others with knowledge of the returns. The people declined to be identified because the information is private.
“Investors will always have the debate over whether it is better to invest with larger funds with size and resources on their side, or to go with their smaller peers who are more nimble and can take a more opportunistic approach,” said Fred Ingham, London-based Asia head of hedge-fund investments at Neuberger Berman Group LLC’s alternative-assets division. “There are certain investors who may accept a slightly lower return threshold for larger funds in exchange for investing with a brand name.”
An index tracking Asian hedge funds advanced 9.7 percent in 2012, according to Singapore-based data provider Eurekahedge Pte, as leadership changes in China and Japan buoyed markets and the U.S. Federal Reserve’s low-interest rate policies led investors to seek higher returns. That beat the 6.2 percent return by Eurekahedge’s global benchmark, the first time Asian hedge funds outperformed since 2009. The Asian index returned 8 percent in the last four months of the year, triple the global measure’s average.
Assets of the Myriad Opportunities fund, which started trading in Hong Kong in December 2011, have grown to $1.7 billion, one of the people said. The fund has indicated that it will soon stop taking additional money after existing investor commitments take assets to $2 billion, the person added.
The MSCI Asia-Pacific Index gained 5.6 percent in the fourth quarter, surpassing the earlier 2012 high in February and rallying 21 percent from its low for the year in June.
Azentus’s fund, overseen by former Goldman Sachs Group Inc. proprietary trader Morgan Sze, focuses on Asia and employs strategies including event-driven, capital structure and convertible-bond arbitrage, distressed assets, volatility trading, private securities and equity long-short.
The Fortress Asia Macro Fund, with more than $500 million, returned 3.65 percent in December, bringing its 2012 return to about 21 percent, according to filings by Fortress Investment Group LLC, a New York-based hedge fund and private-equity firm.
Not all funds saw gains in the year. The event-driven fund of Senrigan Capital Group Ltd., founded in Hong Kong by former Citadel LLC executive Nick Taylor and backed by Blackstone Group LP, pared its loss to about 11 percent last year after four consecutive positive months, according to an investor newsletter seen by Bloomberg News.
Assets of Senrigan Master Fund, which invests in Asian companies undergoing events such as merger and acquisitions, increased to $506 million, after falling below $500 million earlier in 2012 from just over $1 billion in April 2011, according to investor newsletters seen by Bloomberg News.
The $420 million Asian Opportunities fund of New York-based York Capital Management, which oversees $14.5 billion globally, returned 11 percent last year, driven by a 6.3 percent gain in the fourth quarter, according to an investor newsletter seen by Bloomberg.
Globally, event-driven investments will benefit from an increase in corporate activity in 2013, as a market less dominated by macro headlines would improve the ability of company manage to evaluate strategic deals, York Capital said in a newsletter to investors dated Jan. 11.
Tybourne Equity Fund, the Hong Kong manager founded by former regional head of Lone Pine Capital LLC Eashwar Krishnan, returned about 5 percent in 2012, said a person with knowledge of the matter. The fund started trading on July 2 with $500 million and the ability to draw down another $500 million from investors, two people with knowledge of the matter said then.
Myriad Chief Operating Officer Scott Gaynor, Azentus COO Roger Denby-Jones, Senrigan’s investor relations officer Katarina Bendle and Tybourne COO Tanvir Ghani all declined to comment. Feng Hsiung, Asia chief executive officer at York Capital, declined to comment. They cited the confidential nature of the information and regulatory restrictions on marketing.