Asia Hedge Funds Shrink

Asia Hedge Funds Shrink

Number of Asia Hedge Funds Expected to Shrink Further

Asia hedge funds have struggled since the onset of the recession, with hundreds of closures since 2008.  While the number of funds that have closed shop has declined since a record 184 in 2008, the industry has been shrinking and is expected to contract further in 2012.
There were 123 Asian hedge funds that closed in the first 10 months of 2011, compared with 125 in all of 2010 and a record 184 in 2008 when the collapse of Lehman Brothers Holdings Inc. roiled markets, according to Singapore-based data provider Eurekahedge Pte. Artradis Fund Management Pte, once Singapore’s biggest hedge fund, shut, while managers returning money to investors included CoreVest Partners and Kilometre Capital Management Ltd.

Asia’s hedge funds are dwindling as most managers haven’t made money as a business or for investors, said Peter Douglas, principal of Singapore-based GFIA Pte. Hedge funds in the region manage $125 billion, lower than the peak of $176 billion in 2007, according to Eurekahedge.

“2012 will be the year of major attrition,” said Douglas, whose firm advises investors seeking to allocate money to hedge funds and runs a wealth-management business. “People’s stamina will increasingly give out; regardless of your commitment and personal wealth, the number of years that you can go pursuing your dream without any kind of compensation is a stretch.”

Asian hedge funds lost on average 8.7 percent in 2011 through November, their second-worst year on record, according to Eurekahedge. The MSCI Asia Pacific Index declined 17 percent during the same period amid concern that the European sovereign- debt crisis would lead to a global slowdown. Source

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Tags:  Asian hedge funds, Asia hedge fund industry, hedge funds in Asia, Asian hedge fund, Asian hedge fund manager, hedge fund managers in Asia, hedge fund Asia Managers, Asia hedge fund returns

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