Japanese institutional investors—particularly pension funds—are becoming more comfortable with hedge funds. And hedge fund Finnowave Investments is doing its best to make them more comfortable with it as it hopes to quadruple its investments.
The Tokyo-based firm has received a discretionary investment manager license from the Japanese Financial Services Agency, Bloomberg News reports. With it, Finnowave hopes to attract a wave of local institutional investors and to boost its ¥25 billion in assets to ¥100 billion within two years.
“Japanese pension funds’ attitude toward alternative investments is starting to change as they realize the need to diversify their long-only investments,” president Hideki Wakabayashi told Bloomberg. “It’s part of our goal to have a good, balanced investor base by winning more local mandates.”
Certainly, the firm has put up some attractive returns to attract those mandates. Its ¥20 billion flagship—which Wakabayashi hopefully notes has a ¥60 billion capacity—is up 2.5% this year, following double-digit returns in each of the last two years.
Finnowave launched two other hedge funds last year, one investing in small-cap Japanese companies and another investing in Asian technology stocks.