Wednesday March 8, 2017 March 8, 2017 EIP Alpha Starts Asia Market-Neutral Strategy Quote of the Week By Klaus Wille EIP Alpha, a Hong Kong-based $406 million asset manager, has "This will have far-reaching started a new version of an Asia-focused market neutral fund that it wound down late last year. impacts, including lower beer The new $47 million EIP Asian Multi-Strategy Fund has an sales, as Generation Y expanded investment mandate that will allow it to invest in Japan gravitate towards the 'low and directly in China’s bond and equity markets through the firm’s carb' alternate." qualified foreign investor quota on the mainland, EIP’s Chief — Ben Cleary, co-manager of Tribeca Global Investment Officer Nicola Nicoletti said in an interview. The fund is a Natural Resources Fund, on the growing “repackaging” of the EIP Overlay Fund, which was closed in Nicola Nicoletti cannabis industry. Cleary's fund gained 145 November because the managers wanted to add to its investment percent last year in part by betting on scope. marijuana companies (see story) The new EIP fund targets positive returns in all kinds of markets with low volatility, Nicoletti said. The previous fund returned 6.4 percent per year since its inception in Inside 2002, he said. “With the development of the derivatives and borrowing markets in China, there Returns in Brief should be plenty of opportunities for us to generate alpha in a market-neutral fashion." Most February numbers are positive Nicoletti co-manages the fund with former Jardine Fleming Group banker Tobias for early-reporting Asia-focused Bland, who founded EIP in 2001 and Christopher Edwards, who previously worked with hedge funds. Singapore-based hedge fund Artradis Fund Management. Market Calls Segantii, Balyasny Hires Griffin Asset Management likes the shares of DCB Bank and SpiceJet. Mike Millard and Adam Weinrich last month joined Segantii Capital Management as fund managers, according to Kurt Ersoy, Segantii's chief executive officer. Market Calls, Revisited Millard was most recently a senior fund manager at Trafalgar Capital Management, a A Bangkok-based hedge fund firm Hong Kong-based investment firm with offices in London, Auckland and Sydney. He last March was bullish on shares of also worked for investment banks including UBS Group AG and Credit Suisse Group Ramayana Lestari Sentosa Tbk, a AG, according to his LinkedIn profile. Jakarta-based clothing retailer. Weinrich was once director of research and a fund manager in the Hong Kong office of Hutchin Hill Capital. The New York-based hedge fund led by Neil Chriss decided to 13F Forensics shut its then 19-month-old Hong Kong office in October to focus on the U.S. market and Hedge funds increased holdings of after the pan-Asian event-driven strategy housed in the office had only been "modestly Chinese companies' American profitable." Depositary Receipts in the fourth Stephan Wenger this month rejoined Balyasny Asset Management as a Hong Kong- quarter. based macro fund manager, said a person with knowledge of the matter, who asked not to be identified as the information is private. Wenger was a fund manager for Balyasny in New York and Hong Kong between 2010 and 2012, according to his LinkedIn profile. In between, he worked for Bank of America Corp.'s Merrill Lynch unit and was most recently Hong Kong-based macro portfolio manager and head of Asia macro trading for Noble Group Ltd., the Singapore-listed commodity trader. — Bei Hu and Nishant Kumar Returns in Brief Hedge Funds Asia March 8, 2017 2 Returns in Brief A look at Asia-focused hedge fund performance in February and year-to-date. Funds in the table below that are not mentioned in the accompanying text were reported in past issues of the Brief or in Bloomberg News stories, which may be accessed on the terminal. Manas Asian Equities Value Fund rose January Returns 2.4 percent in February and is up 8 percent in the first two months of 2016, according to founder Anuj Sehgal. Hong Kong-based Manas Capital's long- biased fund has gained 6.1 percent on average each year since it started trading in March 2012, Sehgal said in an email on March 1. The fund's top five contributors so far this year are Indian companies V-mart Retail Ltd., Kajaria Ceramics Ltd., AIA Engineering Ltd. and Bajaj Electricals Ltd., and Hong Kong-listed Chow Tai Fook Jewellery Group, he said. Sehgal previously worked at JPMorgan Chase & Co., Nomura Holdings Inc. and North of South Capital in Hong Kong. Yong Rong Asset Management's long-short multistrategy fund fell 0.4 percent in February and is up 5.9 percent so far this year, according to an investor letter seen by Bloomberg News. Founder Yong Huang is the chief Year-to-Date Returns Through Feb. 28 investment officer at the firm which has offices in Hong Kong and Shenzhen. Yong Rong Global Excellence Fund invests in equities and equity derivatives, as well as indices, commodities and currencies, and has gained 20 percent annualized since it started trading in July 2012, the letter said. The $177 million fund invests in companies listed in Hong Kong, China and the U.S. as well as American Depository Receipts, according to Rachel Deng, who works in the firm's investor relations department. It fell 24 percent last year caused by the "broad market dip" at the start of the year and "hedges added on, including positions on index and index futures, which prevented performance from bouncing back from the low," in 2016, Deng said in an email dated March 7. Yong Rong Asset Management manages $216 million across three funds. Huang, who previously worked at Huatai Financial Holdings, founded the firm in 2011. — Suzy Waite Market Calls Hedge Funds Asia March 8, 2017 3 Market Calls India-Focused Fund Likes DCB, SpiceJet Market Calls, Revisited Griffin Asset By Suzy Waite Management, a Hong NTAsset (Thailand), a Bangkok-based hedge fund firm, last March was bullish on Kong-based firm that shares of Ramayana Lestari Sentosa Tbk, a Jakarta-based clothing retailer. manages a long-short Consumer sentiment was improving in Indonesia and the company, which focuses fund focused on Indian on the mid-to-low mass market, was benefiting from subsidy distributions by the equities, is bullish on government, an investor letter said at the time. shares of DCB Bank Ltd. and budget airline SpiceJet Ltd. Griffin India Equity Fund began trading on Jan. 27 in Hong Kong and gained 2.2 percent in February, with long investments in both companies contributing Ambar Taneja to the fund's (top) and Nitin performance last month, Birla according to Ambar Taneja, co-founder and CIO. During the non-performing loan crisis in 2009 and 2010, DCB Bank's management focused on mortgages and retail loans as opposed to "chasing large Ramayana Lestari's share price is up 43 percent since March 1, 2016, compared corporate loans which in hindsight, have with a 13 percent rise in the Jakarta Stock Exchange Composite Index. "We remain proved to be costly for so many Indian invested in Ramayana and believe it is undergoing a long-term turnaround and banks," Taneja said in a telephone call continue to believe in the long-term potential for the company," Kenneth Ng, the on March 2. "They've also hired sensibly firm's chief executive officer, said in an email on March 4. The NTAsian Discovery and have long-term investors who help Fund, which manages $658 million, rose 11 percent last year and is up 2.6 percent with regular capital infusions regularly." so far this year through Feb. 28. DCB Bank rose 32 percent last year and is up 43 percent so far this year. above what we think are reasonable SpiceJet meanwhile has recently valuations and companies below are Traders Shun Hedges renegotiated contracts with its suppliers, ignored." Before India Vote from aircraft manufactures to engine Taneja and CEO Nitin Birla started leasing companies to small vendors for Griffin Asset Management in July and Traders are so confident that Prime maintenance items, a cost-saving received its Type-9 license from Hong Minister Narendra Modi’s party will exercise that will help the company's Kong's Securities and Futures win a key state election that they are earnings going forward, he said. SpiceJet Commission in December. Taneja was feeling little need to hedge against has also benefited from low oil prices and previously a senior associate director at another outcome. government subsidies. The company's The NSE Nifty 50 Index has rallied Standard Chartered Bank in Hong Kong shares fell 24 percent in 2016 but are up and before that worked at Bank of China to within a whisker of its life-time high 32 percent so far this year through March International as a director in its wealth amid the lowest price swings in about 7. management unit, according to his six months, as data showed Asia’s Griffin India Equity Fund shorts via LinkedIn profile. He previously started his third-largest economy is recovering futures but is predominately long-biased. own firm in New Delhi called Abacus from Modi’s shock cash ban. The "After the first 100 companies, we Advisory Services and managed a long- cost of put options tied to the gauge focus on the next 200," Taneja said. "The only fund. relative to calls is the lowest since reason is simple. In a market like India, Birla also worked at Standard October. you have a lot of money coming from Chartered and Bank of China Read more here.