Lazard, AMP, Pine River Among Firms Closing Asia Hedge Funds

  • Lazard's Asia equity strategy had $9.8 million in assets
  • AMP's quantitative fund held about $104 million as of November

Lazard Asset Management, AMP Capital and Pine River Capital Management are the latest firms to shutter Asia-focused hedge funds.

The asset-management unit of financial firm Lazard Ltd. closed its $9.8 million Lazard Asia ex-Japan Equity Strategy and the Singapore-based portfolio managers have left, the firm said in an e-mailed statement. Separately, the Australian asset manager with roots in real estate and infrastructure has shut down its AMP Capital Asia Quant Fund, which held about $104 million, after the December departure of its team focusing on the strategy, according to an e-mailed statement.

Pine River closed a multistrategy hedge fund in November after it failed to attract enough assets to justify keeping it going, according to a person familiar with the matter. The Pine River Asia Fund, managed from Hong Kong, had gathered about $120 million since its inception in 2004, said the person, who asked not to be named since the matter is private.

The business of running hedge funds has become more challenging as market volatility damps returns and tighter regulations increase costs for money managers. Investors are also shifting their money to the largest and most successful managers, prompting many smaller-scale firms to exit the business. More than 800 hedge funds closed globally last year in a trend that has been apparent for at least five years, according to data from Eurekahedge Pte.

Competitive Landscape

“Especially in Asia, the hedge fund landscape has become more competitive, which makes it more difficult to raise funds,” said Will Tan, a managing director at Singapore-based recruitment company Principle Partners Pte. “There are just a lot more funds to chose from.”

Across its businesses, AMP Capital managed A$160 billion ($115 billion) as of Dec. 31, according to its website. The firm announced in May 2014 that it was opening the market-neutral hedge fund with $25 million of assets, focused on equity long-short investing in Australia, Hong Kong, Singapore, Taiwan and South Korea. The fund sought to appeal to family offices, pension and state funds, AMP Capital said at the time.

The fund returned 7.2 percent on an annualized basis since its inception, according to AMP spokeswoman Lara Evans. The decision to shut the fund was related to the departure of the team and not to its returns, she said in an e-mail.

Other Closures

Octagon Capital Management Pte, a hedge fund firm started by former GIC Pte. executives, returned all outside money last month and converted to a family office. Others to shut in Singapore include Piquant Capital Pte, which closed its quantitative hedge fund late last year after failing to reach its targeted $60 million in assets.

Outside Asia, Michael Platt’s BlueCrest Capital Management, Doug Hirsch’s Seneca Capital Investments, Scott Bommer’s SAB Capital Management and Martin Taylor and Nick Barnes’s Nevsky Capital are among firms that have shut down or returned outside capital amid rising costs industrywide and shrinking returns.

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