HFRX China Index posts record gain

The HFRX China Index recorded a rise of 50.4% in 2009, according to data released by Hedge Fund Research.

Total capital in the Asian hedge fund industry increased to $76.3 billion over the year, reaching the highest level since the third quarter of 2008. Investors withdrew almost $11 billion from Asian hedge funds. The redemptions were offset by a performance-based increase in assets under management of $15.7 billion.

Equity hedge strategies performed particularly well, generating $10.6 billion in performance-based gains against redemptions of $5.3 billion.

Hedge Fund Research said Asia-focused hedge funds represented over15.1% of all funds, although they were characteristically smaller and more tactically nimble than funds from other regions. Assets invested in Asian funds represented 4.8% of global industry capital.

Nearly 24% of all Asian focused hedge funds are located in China, representing approximately 2.65% of the global industry.

Morgan Stanley and Goldman Sachs have the lion's share of the prime brokerage market, acting for nearly half of the region's hedge funds. Hedge Fund Research said the market share of UBS and Deutsche Bank had grown in 2009.

HSBC, Citco and Bank of Bermuda remained the top three fund administrators for these funds, collectively representing nearly half of all assets under administration.