Hedge Funds with Asian Strategies Now Managed From … Asian Cities
|Nov 22nd, 2011 | Filed under: Alpha Strategies, Hedge Fund Industry Trends, Institutional Investing, Today's Post | By: cfaille||
The hedge fund industry that invests in Asia is increasingly run from within the region, especially from the two hub cities of Hong Kong and Singapore, according to an August 2011 report by Singapore based consult
In the early days of the Asian hedge fund industry, Asian strategies were quite generally run from outside of Asia – most often from New York or London – in order that the managers could stay near their investors or as the GFIA Note says, their “allocators.” But this has been changing markedly since 2006, for several reasons. Perhaps the most obvious reason is that compared to New York or London, “operating and rental costs [in] Asia are much lower.” Further, managers based in the U.S. and U.K. face a diminishing level of “public acceptance,” along with increasing levels of regulation and taxes.
There has been a gradual decline, through the period 2006 to 2011, in the number of Asian funds based in Japan. GFIA isn’t certain of the numbers there, though, because some Japanese funds don’t report to Asiahedge or Eurekahedge. Still: such a decline seems intuitively plausible given the poor returns from Japan’s equities and a “corresponding poor demand for Japanese funds.”
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Christopher Faille is a Jamesian pragmatist. William James has taught him, for example, that "you can say of a line that it runs east, or you can say that it runs west, and the line per se accepts both descriptions without rebelling at the inconsistency."