Keystone Investors, an Asian hedge fund that was spun off from Schonfeld Strategic Advisors, is set to suspend subscriptions in April after a 160% increase in its assets since its launch in 2022, according to two sources familiar with the matter.
The Singapore-based equity fund’s assets under management surpassed $2 billion after the latest round of fundraising this year, the sources said.
The fund is set to suspend new investor subscriptions because Keystone is comfortable with the current size, one of the sources said.
They spoke on condition of anonymity because they are not authorised to speak to media. Keystone declined to comment.
WHY IT’S IMPORTANT
Led by Liu Xuan, a seasoned China investor, Keystone has secured investments from global investors during one of the most challenging periods for fundraising in Asia, making it one of the fastest growing hedge fund startups in the region.
This is in sharp contrast to the $15.6 billion of net outflows in 2023 from hedge funds in Asia tracked by fund services firm Citco.
Keystone’s asset growth suggests global investors are eyeing a return to the region in anticipation of cuts to U.S. interest rates, but only focusing on select fund managers.
CONTEXT
Keystone began trading with $750 million of initial capital in April 2022.
Unlike several other China-centric hedge funds, Keystone pursues a low-net strategy that involves long and short bets on hundreds of companies, aimed at reducing correlations.
Keystone’s performance was buoyed by exposure to U.S. tech titan Nvidia 
NVDA and Chinese e-commerce platform Pinduoduo 
PDD, as per regulatory filings.
BY THE NUMBERS
* Keystone’s flagship fund posted a 20.5% return in 2023 after a 2.8% gain in 2022.
* Asian hedge funds, including Japan, on average returned 5.8% in 2023, according to data provider HFR.