Japanese Hedge Funds Return Close To 25 Percent In 12 Months

By Mani
Updated on

Japanese hedge funds posted an impressive average net return of 24.79 percent during the last 12 months, Preqin’s recent report reveals.

Japanese Hedge Funds Return Close To 25 Percent In 12 Months

According to Preqin’s report, JPY-denominated hedge funds have returned an impressive year-to-date return of 17.14 percent, while the average net return for the past 12 months stood at 24.79 percent.

Event driven strategies post positive returns

Preqin’s report further highlights that event driven strategies were the only hedge fund strategy that managed to post positive returns in August with 0.49 percent, while the strategy generated 16.15 percent return over the past 12 months.

Preqin, the information provider for the alternative assets industry, points out that returns from the hedge funds industry were positive during July, after recording negative returns in June. However, August has again been another disappointing month for hedge funds, with the benchmark posting negative 0.08 percent for the month.

Asia-Pacific hedge funds remain top performing

Preqin’s report highlights Asia-Pacific remains the top performing region during the past 12 months, with Asia-Pacific-focused hedge funds producing net returns of 16.64 percent over the past year, despite August returning a negative 0.33 percent.

The report points out over recent years, the Asia-Pacific region had been growing in prominence in the investment community at large. Aided by rapid expansion of the financial markets in the region, the region offered hedge fund managers several investment opportunities besides indirectly leading to a gradual maturing of institutional investors in the region.

Enthused by the top performance in the region, the Preqin report notes unsurprisingly that most of the investors in the region hail from the highly-developed capital markets.

Japan, home to large investors in APAC

Dwelling deep into its assessment, the report highlights Asia-Pacific-based investors are largely concentrated in the developed economies of Japan with 32 percent, followed by Australia and Hong Kong at 31 and 11 percent respectively.

Preqin’s report notes Japan is home to a number of the largest investors in the Asia-Pacific region, including the asset manager Pension Fund Association, committing over $4 billion to hedge funds.

The report points out Asia-Pacific hedge funds had an exceptionally strong start to 2013, thanks to a strong rally in Japan creating opportunities for hedge funds to trade off the interventions of Shinzo Abe and the so-called Abenomics.

APAC attracting several investors

Thanks to a strong 12-month performance, the Asia-Pacific hedge fund industry is attracting investors from both within the borders of Asia-Pacific and beyond.

Preqin’s report reveals Italy-based Kairos Partners is searching for Japan-focused long/short equity funds to add to its holdings, thanks to strong performance posted by these funds.

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