Israeli hedge funds outperform with significant growth in assets
The Israel hedge fund industry has seen a 33 per cent growth in assets in the past two years to USD2.7 billion under management, according to a survey by Tzur Management.
The survey covers 89 fund managers operating in Israel, representing a growth of 50 per cent in the number of active fund managers over the past two years.
Thirty new funds launched in 2013 alone, according to the study.
Tzur has launched the Tzur Capital Management Israel Index of Israeli hedge fund performance (TCMI), which has outperformed the hedge fund industry in 2012 and 2013 averaging returns of 13 per cent and 17 per cent respectively. Israel-focused hedge funds have also outperformed the TA-25 Index in each of the past three years.
Tzur chief executive and founder Yitz Raab says: “Considering the impressive performance of Israeli hedge funds in recent years, it is no surprise that we are witnessing substantial growth both in assets under management and in the number of funds currently operating in Israel.”
Raab says investments in Israeli hedge funds have increased across all investor categories - private, institutional, Israeli and foreign - demonstrating the growing confidence in Israeli managers.
The survey shows that Israeli managers employ a wide range of strategies, but quantitative strategies – which benefit from Israel’s strengths in high tech and academia – have become the most common fund strategy, accounting for 42 per cent of Israeli hedge funds. Quantitative hedge funds, however, are smaller on average accounting for only 26 per cent of assets under management, while equity long/short funds hold the largest share with 46 per cent of assets.
The majority of hedge fund managers have no investments in the Israeli markets, and about 60 per cent of total industry assets are invested outside of Israel.
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