The cash raised among 83 new funds last year were 42% more than in 2013 when launches attracted $3.85 billion in capital, according to the new funds survey by AsiaHedge, provider of data on Asia-Pacific hedge funds.

 

 “Several key catalysts have contributed to this phenomenal growth,” says Aradhna Dayal, head of Asia for HedgeFund Intelligence in Hong Kong. “Firstly, new entrants today are mostly backed by serious institutional or high-net-worth seeders and strategic investors. This results in strong Day 1 capital, as well as, quick scale up for many of these new launches,” notes Dayal. 

   

Secondly, the quality and pedigree of the Asian managers today is impeccable and truly world class. “Finally, new Asian hedge fund strategies are showing tremendous scalability and prowess to invest globally, allowing institutional investors to make large, meaningful allocations to them,” explains Dayal.

 

Hong Kong consolidated its position as the largest center for Asian launches, with as many as 37 or almost 45% of new funds preferring to be based there, raising $2.63 billion in assets in 2014. Australia trumped Singapore to be the second most fertile ground for new funds in Asia, with nearly $1.2 billion raised in assets last year.

 

The year 2014 belonged to country specific (China, Japan) strategies and pan-Asia strategies, with the Asia (including Japan) funds attracting the highest assets of $1.67 billion in 2014. 

 

Going forward, AsiaHedge expects a continued invigoration in the Asian new hedge fund scene, albeit with a difference.

 

“Continuing on its upward trend, the coming months will see a number of high quality spin-offs and launches by second generation managers, most backed by strategic investors,” predicts Dayal. “As global investors begin correcting their under-exposure to Asia, the Asian hedge fund market will continue to thrive.”