Hyundai's financial services arm is set to seed a new Asia-focused hedge fund, its first-ever such venture outside of South Korea.
Hyundai Securities will provide the bulk of AQG Capital Management's initial capital, expected to be USUSD100 million, the Economic Times reports. AQG will be led by ABN Amro and K3 Capital Management veteran Kim Hong-shik, and will also feature Minsoo Seo, formerly of South Korea's sovereign wealth fund. Singapore-based AQG will employ a quantitative market-neutral strategy, focused on Asian stocks.
Hedge fund managers, traders and finance analysts are leaving Asia as poor returns left many of them unable to collect performance fees arising from the 2008 global financial crisis. In a report, Bloomberg said the majority of these managers and traders have now found jobs in mutual funds, endowments, consulting firms and companies outside of the money-management business and have accepted paychecks lower than what they used to get.
One of those who left was Paul Smith who transferred to Hong Kong from London 17 years ago to try his luck in the Asian hedge funds space. The 53-year-old hedge fund veteran was quoted as saying, "I decided not to wait the cycle out but to do something more productive with my time. The hedge fund industry in Asia will continue to struggle to raise funds for the next few years as banks continue to have liquidity issues." Smith is now head of the Asia Pacific office of the not-for-profit CFA Institute, the global association of chartered financial analysts.
Data from Asia-based hedge fund data provider Eurekahedge showed that hedge fund assets fell 28 per cent from their peak in 2007 while assets of hedge funds across the globe jumped 21 per cent since 2007 to reach a record high USD2.3tln as at end December 2012.