Capital Fund Management, the French quantitative hedge fund manager, has established an office in Shanghai, reported Bloomberg.
The new office, located in Citigroup Tower, began operating earlier this month, according to president Philippe Jordan.
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With two employees at present, the site is being used initially for data and engineering work to support the firm’s trading activity in Chinese markets.
Jordan said the firm is also weighing the possibility of launching domestic funds for Chinese investors at a later stage.
Another option under consideration is the creation of feeder vehicles that would give investors in China access to CFM’s offshore products.
Jordan said: “China is a huge opportunity in terms of diversification and it’s not going away – it’s just growing leaps and bounds over time.
“We believe we need to be present on the ground to get the best of it.”
A number of large US and European hedge funds already operate in China, among them Marshall Wace, DE Shaw and Two Sigma.
The Shanghai move comes during a period of expansion for CFM.
Last year the group returned $2bn from its main Stratus fund in an effort to control the pace of growth. Assets under management have since risen to about $27bn, from roughly $19bn in October.
Investor appetite for quantitative strategies has also been increasing.
CFM’s Stratus fund, which oversees about $12bn, slipped in April and was up 4.8% over the first four months of the year, according to a person familiar with the figures. Its second-largest fund, Cumulus, gained about 5.1% over the same period, the person said.
A CFM representative declined to comment on the performance figures.
