On most mornings, Chong Chin Eai starts his day with a jog through Singapore’s Botanic Gardens. After taking his son to school, he trades futures on his laptop at home until it’s time for lunch, after which he might have a massage or perhaps a nap.

If that sounds snoozy, Chong’s returns are anything but. His Vanda Global Fund Ltd., started with $24 million from friends and family and named after Singapore’s national orchid, is the world’s best-performing hedge fund this year, gaining more than 300%.

Singapore is far from the skyscrapers of New York and The City of London, yet somehow it’s producing hedge funds that are trouncing global rivals. The city-state is home to two of the top 10 in 2019, and a third is partly based in the island nation. In all of the U.S., there are only four, and zero in Europe or Hong Kong.

Their individual successes come at a time when many investors are questioning the wisdom of pouring large amounts of money into hedge funds because of their high fees and mediocre returns. Global outflows total $88 billion so far this year, more than double 2018, eVestment data show.

Hedge funds in Singapore are also shining as a group, generating an average return of 9.4% for clients in 2019, according to Eurekahedge Pte. That beats the 7.6% return for Asia and 6% return for Europe. The Eurekahedge North American Hedge Fund Index is up 7.6% this year.

So why are they winning?

Crazy Risk Takers

There are three key theories behind the success of Singapore’s chart-toppers.

The first is that the region’s crazy rich Asians are also crazy big risk takers, willing to plunge millions into funds that can have massive volatility.

On a per capita basis, Singapore is one of the wealthiest nations on Earth, and it has an outsized wealth management sector.

First « 1 2 3 4 » Next