By Jhoo Dong-chan
Timefolio Asset Management posted a loss ― in the first of the year ― for the first time since the firm was established 15 years ago.
Korea's largest hedge fund operator is expected to post about a 5 percent loss in its 10 hedge funds on the back of growing uncertainties in the global economy.
Timefolio was famous for having never posted a loss since it was established. The firm's reputation attracted a number of wealthy investors to make it Korea's top hedge fund operator a year after it entered the market.
It posted a 141.4 percent gain through its strict loss-cut policy even during the global financial crisis in 2008, but the situation seems tougher this year for the firm.
“The benchmark KOSPI slid about 13 percent in October. Shares were also extremely volatile regardless of stock items,” said a Timefolio official.
“Of the firm's 31 self evaluations on its hedge funds, Timefolio funds were behind the market average only six times. I believe it was okay earnings despite the nation's stock markets declines.”
Most hedge fund operators posted record low earnings in October.
Of the total, including bond funds, nearly 60 percent posted a loss in the period due to the nation's sluggish stock market.
Despite stock market declines, Timefolio managed to attract about 1.45 trillion won ($1.3 billion) to its 11 hedge funds.
Of them, the firm's main hedge fund operates 180 billion won ($161 million), and the fund has averaged a 5 percent return every six months since its inception in 2016.
According to Bloomberg, Korea's hedge fund industry has been rapidly expanding since the government relaxed regulations in 2015, but it's still small by global standards. The funds currently oversee almost $18 billion, about triple the level in February 2017.