Foreign hedge funds scent huge opportunities in China

Foreign hedge funds are looking to leverage on China's favorable outbound investment policies to raise more funds from wealthy Chinese individuals planning to invest abroad.

Indications that foreign hedge fund managers are stepping up their game were evident from the keen interest shown during the second round of the qualified domestic limited partnership program in Shanghai. The QDLP program allows high net-worth Chinese individuals to invest in overseas markets via foreign hedge funds. The first round of the program was conducted in 2013.

Such interest, however, is not confined to Shanghai alone. Other provinces and regions are also stepping up their game to attract foreign hedge fund managers. In Shenzhen, trials are underway for the qualified domestic investment enterprise program, which is similar to the QDLP but more flexible on investment areas. Zhejiang province is building a hedge fund township in Hangzhou to attract hedge fund managers at home and abroad.