Hong Kong Hedge Funds Reach Record AUM

A new survey by the Hong Kong Securities and Futures Commission (SFC) shows that hedge funds there have amassed a record $120.9 billion in assets under management, eclipsing 2008’s prior peak of $90.1 billion.

The report shows that as of the start of the fourth quarter of 2014, SFC-licensed managers indicated a growth in AUM of 39% since September 2012. The report also suggests managers in the Chinese city have shifted focus to Asia-Pacific long/short equity and multi-strategy approaches, while the majority of investors are overseas institutions.

The number of hedge funds in the city has also grown since the SFC’s 2012 report, reaching 778 as of September 2104 compared to 676 two years ago. Meanwhile, some 67% of the AUM comes from institutional investors such as pension funds, endowments, sovereign wealth funds and financial institutions.

The record amount of assets under management comes as Hong Kong grapples with persistence pro-democracy protests. The previous peak, $90.1 billion, came in 2008 immediately prior to the financial crisis, which lopped nearly half of the city’s hedge fund AUM within a year. Since then, both assets and the number of hedge funds have steadily grown.

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