Friday, October 28, 2011

Hedge Funds in Asia: The crocodiles are coming!

According to the Economist: Where they are not greeted with apathy, Asia-minded hedge funds often face antipathy. Since the financial crisis of the late 1990s “fund” has been a four-letter word throughout Asia. George Soros, a famous hedge-fund investor, is still reviled for aggravating and profiting from the crisis. When the Chinese refer to hedge funds as ju e, or “big crocodiles”, it is not by way of a compliment on their killer instincts.
Despite muted interest and outright scorn, though, more and more hedge-fund managers are determined to make their mark on Asia. They see a lot of money to be made, a lack of entrenched competition and a vast number of potential clients.

Ravenous growth and maturing equity and credit markets should mean Asia offers a lot of opportunities. “Our investable universe has doubled in the last five years,” says one happy executive at a fund that recently launched in Hong Kong. At the same time there is little by way of an asset-management industry in much of Asia. Investors’ portfolios mostly consist of just property and stocks, which leaves lots of room for hedge funds’ offerings. And there are vast numbers of millionaires to whom such offers can be made….

Read more at http://www.economist.com/node/21534753

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