04/08/2010 Author: Edward Dean

Asian hedge funds enjoy Q2 inflows

Investors channelled $360m of capital into a broad array of Asian hedge funds in 2010’s second quarter, according to data provider Hedge Fund Research (HFR), as Beijing’s programme of exchange-rate reform proves an attractive proposition.

The influx of fresh capital led to a reversal in the net asset outflow prevalent in Q1 2010, although there was a decline in the total amount of capital invested in Asian-focused hedge funds, down to $74.4bn, as performance losses offset inflows.  

New capital was invested across a range of different hedge fund strategies, with primary interests being event-driven and pan-Asian focused funds encompassing both emerging and developed Asian economics. Macro funds also attracted new capital, with particular focus on currency, commodity and interest rate developments.

Geographically, investors shifted assets from dedicated Emerging Asia funds into funds focused on Japan and broadly across Pan-Asia.

Quarterly performance results were mixed, with Asian equity funds seeing an increase of $1.7bn over Q2, in contrast to equity hedge funds globally, while Asia-focused relative value arbitrage (RVA) funds experienced performance-based losses of $2.6bn, as RVA funds globally rallied.