Apex Capital in US shutters two Asia-focused hedge funds
Apex Capital Management, the Asia-focused hedge fund manager based in New York, has closed its Market Neutral Greater China and North Asia long/short equity strategies, which are thought to have collectively managed about $16 million in assets in its final days.
A representative at Apex’s New York office confirmed that the funds had closed, saying they are “to be launched again after restructuring”. Firm partners Chung Lew and Punit Pujara did not respond to a request for comment by AsianInvestor.
It is the latest chapter in a string of post-crisis developments for Apex – which once managed $900 million in AUM at its peak – and comes less than two years after it parted ways with its Hong Kong operation, which continues to run as a standalone entity.
Founded in 2004 as an Asia-focused long/short equity hedge fund shop with offices in New York and Hong Kong, Apex ran the Greater China Directional, Market Neutral Greater China, and North Asia funds, building a reputation for providing strong performance over the long term.
However, the years that followed the 2008 financial crisis saw the departure of two of Apex’s co-founders – Andrew Beer and Avi Faliks – and a separation of the firm’s two offices.
“As of July 2010, [Hong Kong] and [New York] offices separated from one another in order to pursue their own growth strategies,” says a spokeswoman for Apex Capital Management Hong Kong. “Apex New York became the sole manager of the two funds that [closed].”
Meanwhile, Apex’s Hong Kong operation became the sole manager of the Greater China Directional Fund and, in August 2010, launched the Apex China Opportunity Fund. The two strategies are understood to run a total of about $24 million in assets.
Tat AuYeung, who had headed HSBC’s trading desk in Hong Kong before joining Apex in 2004, remains onboard at the city's Apex operation as founding portfolio manager, says the firm’s spokeswoman.
The closure of the two Apex vehicles is part of a wider trend of hedge fund wind-ups globally, which has been brought on by the economic downturn in the West. Investors have been pulling out of funds with poor performance, which is expected to result in a 10-11% attrition rate among Asian hedge funds. (See the forthcoming issue of AsianInvestor magazine for a 2012 outlook for regional hedge fund industry).
More than a third of the 127 liquidations of Asia funds that occurred in 2011 came in the third quarter, according to data provider Eurekahedge, which believes that better times are in store for hedge funds this year.