Singapore-based hedge fund Blue Rice Investment Management shuts down on weak asset growth.

Blue Rice Investment Management, the Singapore-based Asia-focussed hedge fund, is shutting down operations and returning capital to investors by the end of 2013, Reuters reports.

The decision to close comes as smaller-sized hedge funds continue to have a difficult time attracting investments from risk-wary investors in the region. In an interview with the news service, Guan Ong, founder of Blue Rice IM, said that the tough market environment made it difficult to increase assets under management, which stayed under $100 million since it started in 2009. 

Ong was quoted as saying that the decision to close now is the best option while investors are still enjoying gains for the year. As for his future plans, the former Korea Investment Corp executive said that he will reveal more information after the wind-down is completed. 

Since the 2008 global financial crisis, smaller hedge funds have suffered the inability to attract new money, even as the global hedge fund industry enjoys around $1.91 trillion in total assets as at the end of October 2013. 

According to figures from Eurekahedge, some 296 small Asian hedge funds liquidated as of 30 December 2012 and several more followed suit in 2013. Some of the more recent shutdowns include Hong Kong-based Richland Capital and RG Investment Capital.