Global Hedge Funds Struggle Even in a More Open China Market
- Policy easing is too limited to benefit investors much
- Regulators face battle to attract capital without adding risk
Photographer: Johannes Eisele/AFP/Getty Images
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Global asset managers are struggling to find a foothold in China’s 3.74 trillion yuan ($578 billion) hedge fund industry, despite long-awaited policy changes designed to give foreigners more paths to invest.
In November, China expanded access for more than 400 foreign institutions like UBS Group AG and Citigroup Inc., allowing them to invest through private securities funds, the local version of hedge funds. Global players hoped a new fundraising channel would give their struggling local businesses a quick boost, and many began adding headcount soon after regulators signaled the easing in 2019, said Eric Zhu, head of financial services at recruiter Morgan McKinley.