Asian Long/Short Shop Readies Long-Only Fund

May 28 2008 | 2:00am ET

New York-based Jadeite Capital Investment Advisors is planning a long-only extension of its long/short offering and a research and trading office in Hong Kong.

The firm, the latest beneficiary of Triple A’s $25 million seed equity, has seen its Asia Pacific Absolute Return Fund return more than 17% in its first six months of trading after launching in June, according to founder Greg Jones. Through March, it is up over 8%.

“We’ve been fortunate to avoid the deep drawdowns other equity long/short managers have suffered,” said Jones.

The long/short pan-Asia Absolute Return fund employs bottom-up stock selection investing in a narrow universe of franchise-quality growth companies, according to Jones, adding that the fund uses overlays with specific views on regions or industry groups.

“There are directional risks in terms of countries, sectors and industries,” he said.

Currently, Hong Kong and Chinese stocks represents the largest portion of the fund, followed by Japanese names. The fund has positive directional bets on the healthcare sector, specifically medical equipment, education and Internet-related companies, and is shorting consumer, retail and real estate companies largely from Japan and India.

“We’re currently in an economic down cycle within the region so we’re tilted away from emerging Asia and the smallest cap portion of our universe,” Jones said, adding that the firm plans to open a research and trading office in Hong Kong and launch a long-only Asian-focused fund later on this year.

Asia Pacific Absolute Return charges a 1.5% management fee and a 20% incentive fee with a $1 million minimum investment requirement.

Warren Wibbelsman, head of sales in the U.S. for Triple-A, said his firm anticipates making three more seed investments by the end of the summer.


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