HT Capital Shuts Asia Hedge Funds After Losses, RedemptionsBei Hu
HT Capital Management, the Hong Kong-based investment firm run by the husband and wife team of Karl Hurst and Ophelia Tong, is shutting its hedge funds because of high operational costs and “disappointing performance.”
HT Capital will close down the $74.5 million HT Asian Catalyst Fund, which started trading in 2001, and the $95 million HT Asian Alpha Amoeba Fund, which it has run since April 2005. Both bet on rising and falling stocks in Asia.
“Ophelia and I made this very difficult decision after much consideration,” co-founder Hurst wrote in an e-mailed statement. “2014 was a challenging year for all Asian managers and whilst we managed to navigate our way through extremely volatile markets, our investment performance was lackluster and redemptions were relentless.”
HT Capital pulled the plug on its only two hedge funds after a year in which 56 Asia-focused peers were liquidated by the end of November, less than half the average of 135 in the previous five years, according to numbers from Singapore-based research firm Eurekahedge Pte. That contrasted with worldwide hedge fund closings that totaled 889 by November, above the annual average in the five years since the 2008 global financial crisis.
HT Asian Catalyst Fund lost 3.2 percent last year, the third annual loss in the last 14 years, according to an update to investors. It returned an annualized 9 percent since its April 2001 inception, in line with the Eurekahedge Asian Hedge Fund Index. Regional peers returned an estimated 6.9 percent in 2014.
HT Asian Alpha Amoeba Fund lost 1.6 percent last year, also its third annual loss. That took the annualized return since inception in 2005 to 9.4 percent.
Asian Investor, a Hong Kong-based trade journal, reported the closings earlier today.
Investors and HSBC Holdings Plc, the funds’ administrator, were notified of the closure decision on Jan. 6, Hurst said in the e-mail.
“We don’t have a Plan B at the moment post the redemption process but we are hopeful that as one door closes others might open,” Hurst said, adding HT Capital Management is “very sound financially.”