GFIA has released a research paper continuing its multi-year study of the relationship between a hedge fund manager’s location, and his or her fund’s performance.

In this paper, providing a comprehensive analysis of the effect of manager’s location on performance across different strategies, GFIA found that:

· Asia based managers in aggregate provide higher returns compared with non-Asia based managers running similar strategies

· This outperformance has been consistent at least since September 2004 when GFIA first conducted its analysis

The paper also noted that other variables, such as volatility, drawdowns, correlations, etc, show no consistent relationship with location, and quantified that both the Asia and non-Asia based managers performed better than their respective benchmark indices.

Peter Douglas CAIA, principal of GFIA, commented: “We are firmly convinced that, while there are some very good Asian managers based outside the region, generally they’re handicapped in their return potential compared with indigenous managers. We therefore focus our research effort almost exclusively on managers running their strategy from within the region”

Forthcoming research from GFIA is likely to underline that one effect of this perennial outperformance is the increasing dominance of the Hong Kong/Singapore nexus as the centre of the Asian hedge fund industry, at the expense of the U.S.A. and Europe.