Tuesday, 23 September 2014
Last updated 7 min ago
Sep 11 2013 | 11:31am ET
Asia Pacific-focused hedge funds outstripped their competition in the year ending July 2013, posting net returns of 18.61%.
North America-focused funds returned 15.38% over the same period while Europe-focused funds returned 11.97%.
Unsurprisingly, investor appetite for Asia-Pacific funds is also strong, with 41% of the Asia Pacific-based investors polled by data provider Preqin planning to increase their hedge fund allocations over the next year.
Moreover, 53% of non-Asia Pacific-based investors also plan to increase their allocations to hedge funds targeting that region over the next 12 months.
Preqin's data also shows that Asia Pacific-focused hedge funds have outperformed the overall hedge fund benchmarks in both 2013 (as of July 31) and 2012, as well as on an annualized basis over the past two, three and five years.
Over the course of 2013 so far, Asia Pacific-focused funds managed by firms based in the region have produced a net return of 6.91%, nearly three times higher than funds managed by firms based elsewhere focused on the region at 2.40%.
Asia Pacific-focused long/short funds posted a net return of 22.06% for the 12-month period ending July 31, 2013, outperforming the overall long/short benchmark, which returned 12.55%.
Despite strong performance, the volatility for Asia Pacific-focused hedge funds is higher than the global hedge fund average over the last four years. As of end-July 2013, five-year volatility for Asia Pacific-focused long/short funds was at 12.55% compared with 10.63% for all long/short funds, 11.24% for North America-focused long/short funds and 6.66% for Europe-focused long/short funds.
A full 81% of Asia Pacific-based investors surveyed said that their hedge fund investments had met or exceeded expectations over the past 12 months while 56% of Asia Pacific-based fund managers believe hedge fund industry assets under management in the region will increase in the next 12 months.
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