Asia’s hedge fund market is evolving, with diversification beyond long/short equity into multi-strategy and quantitative approaches, particularly in Japan. The adoption of separately managed accounts (SMAs) is rising, offering investors greater customization, risk control, and transparency. 

Allocators are increasingly partnering with emerging managers early, securing better terms and gaining specialized market insights. Transparency and authenticity are becoming crucial, as investors seek managers who openly share their strategies, risks, and past performance. 

Japan remains a key focus, while sectors like artificial intelligence and semiconductors present new investment opportunities. 

Finsum: Despite these trends, raising capital remains challenging for emerging managers, who must establish strong infrastructure and a compelling value proposition to attract investors.

Sixteen years ago, alternative investments barely featured in most portfolios, aside from a modest allocation to commodities. Options for retail investors were limited, with most alternatives either prohibitively expensive or inaccessible. 

Today, portfolios tell a completely different story, with many being dedicated to alternatives like private equity, private credit, and reinsurance, reflecting how the landscape has evolved. 

Advances such as interval funds and lower fee structures have opened doors for individual investors to tap into the benefits of these assets, including the sought-after illiquidity premium. Unlike the past, where high fees often negated returns, competitive pricing and improved liquidity have made alternatives a more viable choice. 

Finsum: These innovations now allow for greater diversification and the potential to cushion traditional portfolios against market volatility.

With the U.S. presidential election approaching, markets are anticipating potential volatility, and investors are weighing where to allocate their money. While some hedge funds are positioning for “Trump trades,” U.S. Global Investors instead sees growing opportunities in alternative assets like gold and Bitcoin. 

Paul Tudor Jones shares this perspective, highlighting these assets as hedges against rising U.S. debt and inflation concerns. The national debt has reached unsustainable levels, doubling its GDP ratio over 25 years, and the federal deficit continues to climb. 

As inflation impacts traditional assets, commodities like gold, silver, and Bitcoin have become more attractive as they tend to perform well in inflationary environments. 

Finsum: Despite election-related uncertainties, holding alternative assets may help investors maintain portfolio stability in the long run.