(May 13): French quantitative hedge fund Capital Fund Management has opened an office in Shanghai, following in the footsteps of peers in establishing a presence in the world’s second-largest economy.
CFM’s new office in the Citigroup Tower opened earlier this month, president Philippe Jordan said in an interview. The outpost, which currently has two staff, is starting as a data and engineering base to enhance CFM’s ability to trade in Chinese markets, he said.
The hedge fund is also considering setting up onshore funds for Chinese clients at a later date, as well as creating feeder funds that would allow China-based investors to invest in CFM’s offshore funds.
“China is a huge opportunity in terms of diversification and it’s not going away — it’s just growing leaps and bounds over time,” Jordan said. “We believe we need to be present on the ground to get the best of it.”
Several major US and European hedge funds already have a presence in China including Marshall Wace, DE Shaw and Two Sigma. Bridgewater’s funds have become so popular in China that wealthy investors are pouring billions into the nation’s major private banks just for the right to buy them, Bloomberg reported.
CFM’s new office opening comes after a period of rapid expansion for the hedge fund group even after it returned US$2 billion of capital from its flagship Stratus fund last year to manage the rate of growth. It now manages about US$27 billion, up from about US$19 billion in October.
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Quant strategies are benefiting from surging investor interest. Almost a third of investors surveyed by BNP Paribas SA, on a net basis, said they planned to increase their allocation to quant equity strategies in 2026. About a quarter planned to add to quant multi-strategy.
CFM’s Stratus fund, which has about US$12 billion of assets, edged lower in April and was up 4.8% in the first four months of the year, according to a person familiar with the performance. The firm’s second largest fund, Cumulus, is up about 5.1% year through April, they said.
A representative for CFM declined to comment on the returns.
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