Asia-Focused Hedge Funds Suffer In Q1

Tom Burroughes

22 April 2016

Asia-Pacific-focused hedge funds fell into the red in the first three months of this year, falling back on average by 2.2 per cent, the weakest performance of any major global region and reflecting challenging market conditions.

Data from , the research firm tracking alternative investments, showed that although the hedge fund industry as a whole saw a loss of -0.43 per cent in the quarter, monthly returns for Asia-Pacific funds were the most volatile of any region.

Europe-focused funds also struggled, recording losses of 1.97 per cent, while North America-focused funds posted -0.64 per cent for the period as a whole.

The proportion of hedge fund launches in Q1 that were based in Asia-Pacific halved from the level seen in Q4, as the region accounted for just 5 per cent of all launches globally. North America-based managers represented 64 per cent of launches in the quarter, with Europe accounting for just over a quarter (27 per cent).

The appetite of Asia-Pacific-based investors for hedge funds has significantly decreased from 36 per cent of fund searches in the final quarter of 2015 to 11 per cent of fund searches in Q1 2016.

Three-quarters of the top 20 biggest hedge fund managers are based in the US with the largest, Bridgewater Associates, holding $152 billion in assets under management as of the end of 2015. The three largest fund of hedge fund managers are also all based in the US, holding a combined $132 billion.