Asia Hedge Funds Outperform Amid Market Selloff: Asia-focused hedge funds have shown resilience in the face of a March 2025 market downturn. As of March 10, these funds recorded an average loss of just 0.71%, compared to a 2.6% drop for U.S.-focused hedge funds and 1.7% for global peers, according to Morgan Stanley’s prime brokerage note. This outperformance is attributed to strong positioning in Chinese stocks, which have attracted global capital amid a U.S. market rout fueled by recession fears. Analysts suggest this could signal Asia as a relative safe haven for hedge fund investments.
AI Arms Race in China: Chinese hedge fund High-Flyer’s success with AI-driven trading has sparked a competitive surge among mainland asset managers. As reported today, firms like Baiont Quant and Mingshi Investment Management are intensifying AI research, leveraging tools like DeepSeek. This trend could reshape China’s $10 trillion fund management industry, with local governments, such as Shenzhen’s, pledging 4.5 billion yuan ($620.75 million) to support hedge funds’ AI computing needs.
Hedge Funds De-Risk Aggressively: Goldman Sachs reports that hedge funds unwound positions at a pace not seen since the COVID-19 crash of March 2020. This de-risking, peaking earlier this week, reflects fears of a U.S. recession and tariff uncertainties under the Trump administration, impacting equity-focused strategies. Multistrategy giants like Citadel and Point72 faced losses, testing their haven appeal amid volatile markets.
