Japan Hedge Funds Lose 1.5% As Nikkei Plummets 10%

Aug 10 2012 | 11:06am ET

Japan-focused hedge funds lost 1.5% in Q2 2012 reversing their Q1 5.2% gains as the Nikkei fell over 10%, reports Hedge Fund Research.

Funds investing in China fell 1.6%, while those investing in Asia with Japan were down 2.4%.

Hedge funds investing in other emerging Asia economies took much bigger hits in the second quarter, with Indian funds shedding 8.4% while Korean funds lost a whopping 10.8%. The losses represented a sharp about-face for both—Indian funds had added 19.2% and Korean funds 6.3% in the first quarter.

Investors entrusted only $88 million in net new capital to Asia-focused hedge funds in Q2, paying particular attention to Japan. But total capital invested in Asian hedge funds declined by $3.3 billion during the quarter, to $83.3 billion.

Asia-focused hedge funds now number 1,117, says HFR, and account for almost 15% of total global hedge funds. Moreover, an increasing number are headquartered in the region—30.46% in China, 9.27% in Singapore, 3.07% in Japan.

Equity hedge strategies account for about 73% of Asian hedge funds, followed by relative value at 13%, event-driven at 12% and macro at 2%.


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