Sydney-based hedge fund Regal Partners Ltd is on track to attract more than AUD2bn ($1.4bn) in net inflows this year, driven by growing demand for strategies designed to protect portfolios against inflation amid ongoing geopolitical tensions, according to a report by Bloomberg.

The firm reported net inflows of around AUD200m through April, adding to AUD449m recorded in the first quarter, according to chief executive Brendan O’Connor. He said the momentum marks the strongest start to a year since the company listed nearly four years ago.

Following the latest inflows, Regal’s assets under management have risen to roughly AUD21bn, reflecting sustained investor appetite for alternative and diversified strategies.

O’Connor said the firm would be “disappointed” if full-year inflows did not exceed AUD2bn, citing robust demand from institutional investors globally. He attributed part of the growth to heightened geopolitical uncertainty, which has increased interest in portfolios that can help mitigate inflation and interest rate risk.

The company is seeing particularly strong engagement from institutional allocators in North America, Europe and the Middle East, many of whom are seeking exposure outside traditional US-heavy portfolios. Investors are increasingly prioritising uncorrelated strategies with perceived inflation-hedging characteristics, O’Connor noted.

Regal also secured its first mandate from a Middle Eastern investor this year and is actively developing a broader pipeline across the region. As part of its international expansion strategy, the firm has also been strengthening its distribution presence, including efforts to build out its team in New York.