International Herald Tribune – Aaron Boesky, a hedge fund manager in Hong Kong, said he would petition regulators in China to let more overseas funds invest in mainland Chinese stock markets, whichhave grown by more than $400 billion this year.
Most hedge funds are barred from mainland stock markets by a rule that they need more than $5 billion of assets to apply for an investment quota in the country, Boesky said. That means they are missing an opportunity to search for hidden gems among the 1,400 mainland-listed stocks or to profit from market inefficiencies, he said.
“The role falls on us to step forward,” said Boesky, who set up Marco Polo Investments Group in 2004 to invest solely in the mainland. He said he aims to induce 20 other hedge funds to sign the petition.
The Communist Party has delivered average economic growth of about 10 percent a year on the mainland by pushing market-oriented policies and widening access for overseas investors. Failure to include hedge funds among institutions so far granted $8.65 billion of quotas to buy shares may hamper development of mainland capital markets, said Vincent Duhamel, head of asset management in Asia outside Japan at Goldman Sachs Group.
