Segantii Asia Equity Hedge Fund Returns 29% in First Nine Months

The Segantii Asia-Pacific Equity Multi-Strategy Fund returned 29 percent in the first three quarters after having the best month since its 2007 inception in September, according to an update sent to investors.

The fund led by Simon Sadler, a former head of Asian equity trading at HSBC Holdings Plc’s regional securities unit, gained 12 percent in September. Trading profits helped boost assets of the fund to $878.2 million from $638.9 million at the end of April, according to the document seen by Bloomberg News.

Increasing price swings in markets, more opportunities to profit from mispricing of related securities and capital market fundraising during September were behind the gains for some equity strategies focused on trading. A proposed link between the Shanghai and Hong Kong stock exchanges also created opportunities.

The Eurekahedge Asian Hedge Fund Index returned 4.6 percent this year through September, according to preliminary data from the Singapore-based data tracker.

The Chicago Board Options Exchange Volatility Index jumped 36 percent in September as tensions in Russia and the Middle East compounded concerns about higher borrowing costs and scaled-back stimulus in the U.S. Also known as the VIX, or the stock market fear index, it measures the price of using options to hedge against losses in the Standard & Poor’s 500 Index.

The Hong Kong-Shanghai bourse linkage plan announced by China in April will for the first time allow foreign investors to trade Shanghai-listed yuan stocks without a qualified foreign institutional investor quota from the regulators.

Hedge funds have attempted to profit from the pricing gap between shares quoted on the two exchanges before the link’s anticipated start this month, which is expected to reduce the difference over time. The Hang Seng China AH Premium Index swung between 92.6 to 100.4 during the month, with 100 indicating equal value.

The Segantii fund trades Asian equities and equity-linked securities with a focus on North Asia. It dropped 1.7 percent last year, the only annual loss since inception in December 2007. It has returned an annualized 16 percent since inception.

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