WEALTH HEDGE
US body boosts cross-border fund action for mutual benefit
As president and founder of ConnecticutHedgeFundAssociation, a Greenwich-based association that represents the world’s second largest hedge fund center, Bruce McGuire has been playing a key role in developing China’s asset management industry.
Chinese authorities have of late been increasing their efforts to develop and support the industry in a bid to spur local economic growth and attract financial talent. But with the country’s hedge fund scene still at a nascent stage, professionals from the sector have been eager to learn from foreign experts such as McGuire.
Back in 2011 when Chinese authorities were looking to build the country’s first investment management commercial park, McGuire was the one who helped organize a trip that brought a delegation from Shanghai’s Fengxian district to Greenwich, Connecticut, to learn more about the industry.
The American’s name has since been making its way around circles interested in developing investment management hubs in China and he has also helped delegations from other Chinese cities such as Beijing and Shanghai with their visits to the CTHFA.
Founded in 2004 in Greenwich, a vibrant hub in the United States that is home to some 380 hedge funds with combined assets worth $350 billion, the CTHFA has evolved from a group of Goldman Sachs Asset Management alumni members looking to network to an organization with around 3,000 members.
What makes the association appealing to members is the synergy it creates by bringing members together to push forward development of alternative investment approaches through quarterly symposia which serve as an educational forum and a networking opportunity for professionals, said McGuire.
In addition, asset management professionals are attracted by the town’s proximity to financial hubs in New York and its high yet affordable standard of living.
According to research by Zero2ipo, a private venture firm based in Beijing, more than 10 cities in China are planning to establish their own industry-specific hedge fund towns like Greenwich.
In Ningbo, East China’s Zhejiang province, a fund town for hedge funds has already attracted more than 700 funds with a combined capital exceeding 100 billion yuan ($14.56 billion) as of the end of 2016. In Beijing, a fund town for equity firms has more than 100 funds registered with combined assets under management reaching 180 billion yuan.
According to McGuire, who is also a board member of the Connecticut-China Council, the asset management industry has in recent years been focusing on cross-border opportunities, particularly those between the US and China markets.
“Speaking from my experience at Greenwich, I think the development of fund towns relies not only on government policies regarding the attraction of investment, capital and industries,” said the 52-year-old, who had previously worked at Chicagobased Mesirow Financial and Merrill Lynch.
Bruce McGuire, president and founder of the Connecticut Hedge Fund Association
“Development also depends on the environment and the availability of facilities such as hospitals, schools and lifestyle amenities which can convince asset management professionals to settle down to work and raise a family.”
The CTHFA and the Zhejiang International Hedge Fund Talents Association had on Nov 30 announced the firstever strategic partnership between leading fund associations in the US and China. Officials said that this historic partnership will facilitate open dialogue and reciprocal visits between the two associations where members can share knowledge, expand their commercial networks and build new partnerships.
The Zhejiang association is the largest independent hedge fund body in China and it represents over 300 of China’s leading hedge funds.
“This is the latest in a series of engagements that the CTHFA has in Chinese cities and the association will continue to promote the global hedge fund industry and facilitate cross-border growth opportunities for funds in both countries through this partnership,” said McGuire.
The two associations will also work together to build the “WestLake-Greenwich”Private Security Fund Index, delivering a valuable measure of Sino-US private fund data.
McGuire added that the decision to establish such a partnership was a simple one to make, seeing how China is the second-largest economy in the world and the engine of growth for the 21st century, while US asset managers, especially those located in Greenwich, are some of the best and brightest in the field of finance and investment management.
“China can benefit greatly from the talents of these proven wealth managers, from both thepositiveimpacttheirinvestments can have on the real Chinese economy and through the superior returns generated for Chinese institutions and investors. We want to be a part of the significant growth in China,” said McGuire.
Development also depends on the environment and the availability of facilities.”