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Homegrown hedge funds amass over 6 tln won

All News 14:08 September 05, 2016

SEOUL, Sept. 5 (Yonhap) -- South Korea's hedge funds have rapidly grown to see their assets under management exceed 6 trillion won (US$5.4 billion), industry data showed Monday.

Local hedge funds' assets under management came to 6.2 trillion won as of end-August, according to the data.

The volume of South Korea's hedge funds, introduced in late 2011, continued to grow fast from 800 billion won in September 2012 to over 3 trillion won in January this year.

Market watchers said hedge funds have emerged as an attractive investment vehicle, especially for rich investors, as they are increasingly losing appetite for stock funds.

Domestic stock funds have suffered a net outflow of nearly 2 trillion won in August alone due to lukewarm market trends here.

On the back of the popularity of hedge funds, the number of licensed managers has jumped to 49. The market size here is expected to grow to 8 trillion won by the end of the year, they said.

"The heat is turning up for hedge funds. You can call it a hedge fund syndrome," an industry official said. "Competition in the hedge fund management market will get fiercer if local securities firms enter the market on a full scale."

The financial authorities have eased restrictions on brokerage houses to tap into the hedge fund market.

NH Investment & Securities Co. is the first to launch hedge funds, currently worth 260 billion won. It plans to draw 40 billion won in additional investment.

Other securities firms, such as Kyobo, Samsung, Shinyoung, Tauraus and Korea Asset, are also preparing to launch hedge funds.


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