HedgeCo.net – SPARX Group Co. Ltd.’s Fund-of-Funds unit today announced the launch of a new strategy targeting hedge funds focused on Greater China. The strategy, which has been seeded with US$25 million by a pension fund, will be overseen locally by in-house China experts. It is designed to generate attractive, risk-adjusted returns across market cycles by investing in a diversified array of hedge funds operating primarily in China, Hong Kong, Singapore and Taiwan.

The SPARX Greater China Fund-of-Funds strategy mines a rapidly expanding universe of China-focused hedge funds and currently features a concentrated portfolio of up to 15 names with 5-10 managers as core holdings. Targeted opportunities include arbitrage, corporate restructuring, event-driven, increased volatility, volatility trading and classic equity long-short. The strategy incorporates rigorous selection criteria such as a requirement that targeted funds’ managers have direct investment experience in China, preferably for at least one full investment cycle.

Steve Seneque, SPARX Fund-of-Funds CIO and Co-Head of business, commented: “Our Greater China portfolio is designed to capture specific investment opportunities in China arising from the growth and structural reforms in the economy and capital markets.” He added: “Given the size and diversity of those opportunities, our newest strategy will leverage on the different skill sets of underlying hedge fund managers to deliver a multi-strategy and multi-dimensional approach to investing in China, which today means primarily through equity and equity-linked securities.”

The Fund-of-Funds investment team at SPARX, which consists of 9 professionals based in Hong Kong and Tokyo, is a leading provider of Asia-focused fund-of-hedge fund alternative investment products to global investors. SPARX Fund-of-Funds, a key unit of Tokyo-headquartered SPARX Group, boasts a robust infrastructure and is one of the longest-lived fund-of-hedge funds in Asia, with Global and Asia-dedicated strategies dating back to 1997 and 2002, respectively. “We have one of the most multi-cultural and experienced investment teams in Asia,” remarked Masaki Taniguchi, Head of SPARX Group’s Hong Kong office and Co-Head of SPARX Fund of Funds, noting the team includes two Ph.D.s, four CFAs and two CPAs.

The SPARX Fund-of-Funds team believes assets in its China Fund-of-Funds strategy will grow over time as qualified investors pursue diversification within their Asian investments and seek out a focused vehicle for investing in China.