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Hedge Fund. Member list. Lam, Ho-kei Jan 023011 Ng, Lok-hang Jessica 033125 Chan, Ka-po Kate 033139 Lee, Tak-ming Alvin 033228 Wong, Wing-yin Winnie 034025 Kwan, Cheuk-shing Elvis 035052. History of Hedge Fund. History of Hedge Fund. Hedge  trying to offset possible losses

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member list
Member list
  • Lam, Ho-kei Jan 023011
  • Ng, Lok-hang Jessica 033125
  • Chan, Ka-po Kate 033139
  • Lee, Tak-ming Alvin 033228
  • Wong, Wing-yin Winnie 034025
  • Kwan, Cheuk-shing Elvis 035052
slide4

History of Hedge Fund

  • Hedge  trying to offset possible losses
  • begin in 1949 by Alfred Winslow Jones
  • his strategy posted on “Fortune”

 short selling and leverage

  • 1952  A.W. Jones & Co

 First Hedge Fund  continuous profit

  • combination of shared risk to ensure goals
  • father of hedge fund
history of hedge fund con t
History of Hedge Fund (con’t)
  • Fail & success, quiet & hot  over 2 decades
  • Late 1990s

 Great development & grow rapidly

  • Currently, over 6,000 exist in industry
  • size at $1 trillion
hedge funds in hong kong
Hedge Funds in Hong Kong
  • History of hedge funds

 relatively short in Hong Kong

  • Intended for sale to public

 to be authorized by SFC

 comply with hedge funds guidelines issued by SFC in 2002

hedge funds in hong kong con t
Hedge Funds in Hong Kong (con’t)
  • First three authorized funds

 First quarter of 2003

 2 single hedge funds & 1 FHF

  • Figures from AisaHedge

 first half of 2005

 new hedge funds about US $3.5 billions established in Asia

 1/3 were entered Hong Kong

first retail hedge fund
First Retail Hedge Fund
  • Approved by the Special Administrative Region’s regulator SFC
  • Offer to public beyond
    • Professionals

fund manager, divisions of banks, insurance companies &certain pension fund

    • Private Placement

 limited number of persons

changes in regulations
Changes in Regulations
  • Allow fund managers to single strategy hedge funds, FoHFs & capital-guaranteed hedge funds to retail investors
  • Minimum subscriptions
    • $50,000 for single strategy fund
    • $10,000 for FoHFs
first retail hedge fund con t
First Retail Hedge Fund (con’t)
  • Authorization of first 3 hedge funds on 28/11/2002

 2 single strategy hedge funds

    • JF Asia Absolute Return Fund
    • JF Greater China Absolute Return Fund

one FoHFs

    • HSBC Global Strategy Hedge Fund
regulation
Regulation
  • Authorization regime govern by SFC
    • Get authorization before selling in the market
    • Specific requirements on fund managers
    • Minimum purchase amount
fund manager
Fund manager
  • 4 additional requirements
    • Assets under management (AUM)
    • Risk management profile
    • Internal control system
    • Information disclosure
fund manager con t
Fund manager (con’t)
  • Professional expertise
    • 5-year general experience
    • 2-year experience in specific hedge fund strategy
fund manager con t1
Fund manager (con’t)
  • Amount of assets under management
    • At least US$100 million
fund manager con t2
Fund manager (con’t)
  • Risk management and internal control system
    • Consider business nature
    • Consider business risk
    • Set up risk management process
    • Monitor the model
fund manager con t3
Fund manager (con’t)
  • Appointments of representatives and agents
    • agents involved in the daily operation

e.g. administrators, custodians, prime brokers

      • Sufficient know-how in their own areas
    • Provide adequate information and training to their selling agents
regulatory parameters1
Regulatory Parameters
  • If any company has not complies with the various requirements, then:
    • liable for a fine of up to HK$100,000
  • If it incurred for matters (e.g.: prospectus containing an untrue statement )
    • Additional penalties (fines of up to HK$500,000 and imprisonment for up to three years)
regulatory parameters con t
Regulatory Parameters (con’t)
  • Prospectus included:
    • any prospectus, notice, circular, brochure, advertisement, or other document
      • offering any shares or debentures of a company to the public
      • calculated to invite offers

offering any shares or debentures of a company to the public

offer to the public
Offer to \'The Public\'
  • There is an exemption:
    • exempt from the requirement to prepare and register a prospectus
  • It is necessary that:
    • He offer is either not made to \'the public\' ,or;
    • The offer falls within one of the available statutory exemptions
offer to the public con t
Offer to \'The Public‘ (con’t)
  • Two available exemptions:
    • Professionals only
    • Private placement
six types of hedge fund in hong kong
Six Types of Hedge Fund in Hong Kong
  • HSBC Global Strategy Hedge-USD
  • JF Asia Absolute Return-Notional Class
  • AJF Greater China Absolute Return-0301
  • JF Japan Absolute Return-0308
  • JF Korea Absolute Return-0309
  • Man Hedge Diversified Ltd
hsbc global strategy hedge fund
HSBC Global Strategy Hedge Fund匯豐環球策略對沖基金
  • NAV (2006-03-31) 12.499
  • Total Net Assets 17,960 (in thousand)
fund performance
Fund performance
  • Annual Returns (%, USD)
  • Growth of $10,000
  • 2004 gain 5.16%
  • 2005gain 8.73%
  • Now gain 4.24%
fund fact
Fund fact
  • Minimum Purchase(USD )
  • Initial Investment
    • 10,000
  • Additional
    • 1,000
fund fact con t
Fund fact(con’t)
  • Annual Expense
  • Mgt & Distribution Fee
    • 1.65%
  • Sales Fees
  • Initial
    • 5.25%
  • Deferred
    • ---
jf asia absolute return jf
JF Asia Absolute Return JF亞洲先鋒基金
  • NAV (2006-04-21)
    • 44.0127
  • Total Net Assets(000\'s)
    • 85,300
how has this fund performed
How has this fund performed?
  • Annual Returns (%, USD) Growth of $10,000
  • 2003 27.5%
  • 2004 -4.13%
  • 2005 -1.67%
  • Now 17.93%
fund fact1
Fund fact
  • Minimum Purchase(USD )
  • Initial Investment
    • 50,000
  • Annual Expense
  • Mgt & Distribution Fee
    • 1.00%
  • Sales Fees
  • Initial
    • 5.00%
jf japan absolute return jf
JF Japan Absolute Return JF日本先鋒基金
  • NAV (2006-04-21)
    • 17589.9200
  • Total Net Assets(000\'s)
    • 44,905,300
how has this fund performed1
How has this fund performed?
  • Annual Returns (%, USD) Growth of $10,000
  • 2004 23.86%
  • 2005 7.13%
  • Now -1.62%
fund fact2
Fund Fact
  • Annual Expense
  • Mgt & Distribution Fee
    • 1.00%
  • Sales Fees
  • Initial
    • 5.00%
  • Deferred
    • ---
case study 1 hsbc global strategy hedge fund
Case Study 1HSBC Global Strategy Hedge Fund
  • a fund of hedge funds
  • a diversified portfolio made up of equity long/short hedge funds
what does this fund own
What does this fund own?
  • Cash 3.5%
  • Stock 0%
  • Bond 0%
  • Others 96.5%
hsbc global strategy hedge fund con t
HSBC Global Strategy Hedge Fund (Con’t)
  • Inception Date:2003-02-28
  • Manager Name: Team Managed
  • Fund Advisor: HSBC Republic Investment Limited
fund performance1
Fund performance
  • Annual Returns (%, USD)
  • Growth of $10,000
  • 2004 gain 5.16%
  • 2005gain 8.73%
  • Now gain 4.24%
how risky is this fund
How risky is this fund ?
  • Worst Quarter Return2.54%
  • Number of Funds in Category: 5  diversify risks
case study 2 jf asia absolute return notional class a
Case Study 2JF Asia Absolute Return - Notional Class A
  • Aggressively managed portfolio of equities, bonds and currencies, and derivatives of any of these
  • Investing primarily in the Asia-Pacific region (including Japan)
jf asia absolute return notional class a con t
JF Asia Absolute Return - Notional Class A(Con’t)
  • Inception Date:1998-10-30
  • Manager Name: Victor Lee
  • Mgr Start Date: 2005-07-18
how has this fund performed2
How has this fund performed?
  • Annual Returns (%, USD) Growth of $10,000
  • 2003 27.5%
  • 2004 -4.13%
  • 2005 -1.67%
  • Now 17.93%
how risky is this fund1
How risky is this fund ?
  • Worst Quarter Return 12.34%
  • Number of Funds in Category: 5
  • Risk Profile(3-year standard Deviation)
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