Long-standing hedge fund HT Capital to close
Hong Kong-based HT Capital Management is to close its doors after 14 years due to prevailing high operational costs and disappointing performance, AsianInvestor can reveal.
The long/short equity manager’s founders – husband-and-wife team Ophelia Tong and Karl Hurst – notified investors and administrator HSBC of their decision on January 6. The highly regarded firm, founded in 1997, saw its assets under management peak at $700.47 million in December 2010.
AsianInvestor named Hurst and Tong in its list of the most influential people in the Asian hedge fund industry in 2010. Tong also made our 2011 pick of the 25 most influential women in asset management in the region.
As at December 31 last year the HT Asian Catalyst Fund had $74.5 million in AUM and was down 3.2% on the year, while the HT Asian Amoeba Fund had AUM of $95 million and was down 1.56%. Repayments for the Catalyst Fund will be valued as at March 2 (its 14th anniversary) and for the Amoeba Fund as at April 1 (its 10th anniversary).
Globally, long/short equity funds returned +1.46% last year, according to data provider eVestment.
The Amoeba Fund has returned 9.38% annualised since inception and the Catalyst Fund 9.02%.
In a letter to clients, Hurst noted: “Ophelia and I made this very difficult decision after much consideration. 2014 was a challenging year for all Asian managers and whilst we managed to navigate our way through extremely volatile markets, our investment performance was lacklustre and redemptions were relentless.”
The firm felt it was not feasible to continue with its investment objectives and policy due to high operational costs and disappointing performance, and that therefore closure was in the best interests of investors.
“HT Capital Management is very sound financially and both Ophelia and I are in excellent health so given our concerns about the markets, performance and costs, we firmly believe our decision to be timely for investors, our firm and us,” Hurst wrote.
“Investor response to date has been very kind and understanding, which essentially confirms our decision to be the correct decision.”
The couple do not have plans for what they will do next, but said: “We are hopeful that as one door closes others might open. Retirement is not a preferred option!”
The hedge fund industry as a whole posted performance of +2.48% last year, following returns of +10.19% for 2013, according to eVestment. Managed futures funds ended 2014 as the best performing major hedge fund strategy, returning +8.63% last year.