LONDON (HedgeWorld.com)–In four weeks, Shinsei Bank in Tokyo was able to raise US$20 million in additional assets for its first hedge fund of funds offering in a stock market that many foreign investors are exiting.
Individual investors in Japan seem eager to invest in their own markets but are looking more seriously at hedge fund strategies offering protection, according to officials at Investor Select Advisors in London.
“This is very much a specialist business,” said Peter O’ Neil Donnellon, Investor Select’s managing director for research and investment. “I would recognize that we are one of the few gathering assets from Japanese investors.”
Investor Select partnered with Shinsei Bank last year to offer a multi-strategy, yen-denominated fund to Japanese high-net-worth investors Previous HedgeWorld Story. The firm continues to manage the strategy it has incubated for the last year.
The Shinsei Protected Japanese Trust was launched on Feb. 1, after Shinsei officials were able to raise US$30 million in assets for a first tranche in December and January. Investor demand continued, and as the Trust outperformed Japanese stock indexes by up to 6%, a second tranche was opened in March and another US$20 million came in within a four-week period.
Recent research suggests that the Japanese hedge fund market may be shrinking, considering the allocation of capital to Japanese markets was down 20% at year-end Previous HedgeWorld Story. But much of the negative market sentiment is from foreign investors, given that the Japanese market is in the middle of a 13-year bear market, according to Investor Select.