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Asian-Focused Funds Focused On China Bounced In October, Soothing Some Recent Pain - HFR

China-focused hedge funds regained some ground last month, although in general the year so far hasn't been a banner one for Asia hedge funds.
Asian hedge funds focused on investing in China bounced in
October and won back some – if not all – of the losses suffered
in recent months, according to figures from Hedge Fund
Research.
The HFRI China Index, a broad measure of returns, gained 5.2 per
cent in October, the strongest monthly performance since gaining
14.1 per cent in April.
Total hedge fund capital invested in Asian-focused funds fell to
$117.5 billion in the third quarter of this year, falling $8.7
billion from the previous three months. This is the largest
quarterly asset drop since the final quarter of 2008 when stocks
were hit by the financial crisis.
Investor withdrawals in the third quarter were slightly less
than $1 billion, while performance-based losses approached $8
billion. Globally, total hedge fund capital fell by $95 billion
in the quarter to $2.87 trillion, HFR said.
In the quarter, Chinese-focused hedge funds were hurt because
nearly half the stocks on the Shanghai and Shenzhen exchanges
experienced trading halts, prompting formal investigations of
Chinese securities firms by local authorities. China’s central
bank has cut rates in a bid to ward off a hard landing for the
Asian economy.
Despite falling -15.4 per cent in Q3, the HFRI China Index has
gained 5.2 per cent since January through October, outpacing the
Shanghai Composite Index.
Hedge funds investing in Japan fell, with the HFRI Japan Index
down 4.0 per cent.