(Bloomberg) -- Hermes Li’s Aspex Management (HK) Ltd. posted double-digit returns in the first half, helping boost the firm’s assets under management to more than $9 billion, according to people familiar with the matter.
Aspex’s hedge fund, one of the largest in Asia, returned 21% in the six months through June, said the people, who asked not to be named as the information is private.
The average Asia stock-focused hedge fund was up just under 4% in the same period, according to a Eurekahedge Pte index. An Aspex representative didn’t immediately reply to a message seeking comment.
While Aspex’s investments in semiconductor and technology-related sectors surged, they contributed less than half of the gains, said one of the people. The fund also made money across industries and economies, including South Korea, China, Taiwan, Southeast Asia and those outside Asia.
Asia hedge fund assets have quadrupled since the turn of the century, but the region accounts for just 3% of global industry assets, according to data from Hedge Fund Research Inc. Asia-based managers have tried to prove, with mixed records at best, that multi-billion-dollar hedge funds can be run successfully outside the US and Europe.
Li was an Asia head of equities at Och-Ziff Capital Management Inc., now known as Sculptor Capital Management Inc. He opened his own hedge fund to outside investors in March 2019, gathering $1.5 billion by November that year, before Covid grounded travel and thwarted fundraising efforts for Asia-based managers. Since then, geopolitics have added to capital-raising woes.
In a region dominated by stock pickers who tout their company and industry insights, Li has gained a reputation for combining research with the trader instinct of spotting shifts in market sentiment, said people familiar with his style. About 77% of Asian hedge funds are stock-focused, versus 48% globally, according to HFR.
Going into the second quarter, Aspex’s largest US-listed stock holding was Southeast Asia e-commerce giant Sea Ltd. Sea jumped 76% in the first half, as profits beat analyst estimates. It has given back some of the gains in July.
Sea’s US shares slumped in both 2022 and 2023, as sales growth slowed due to competition from ByteDance Ltd.’s TikTok and Alibaba Group Holding Ltd.’s Lazada.
Aspex ranked as Sea’s second-largest hedge fund shareholder after Tiger Global Management LLC by the end of March, according to data compiled by Bloomberg.
The other nine of Aspex’s top US holdings as of March also had double-digit share price surges in the first quarter. They included US semiconductor and technology stocks Marvell Technology Inc., Micron Technology Inc. and Lam Research Corp.
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