Core Insights - Global asset management executives express increased interest in the Chinese market, highlighting Hong Kong's role as a vital bridge between mainland China and global markets [1][5][6] Group 1: Emerging Market Trends - There is a sustained increase in global investor interest in emerging markets, with many strategies focusing on China [2][4] - Three key reasons for this trend include profitability and valuation advantages, structural growth opportunities in sectors like AI and clean energy, and the diversification value of emerging markets [4] Group 2: Hong Kong's Strategic Role - Hong Kong's role in connecting global capital with China's asset markets is more critical than ever due to ongoing capital market openings and the internationalization of the RMB [6][8] - The city serves as a primary channel for global capital to participate in China's growth story, with trends such as Chinese companies returning for secondary listings and the rise of dual-listed stocks [8][9] Group 3: Investment Products and Strategies - There is a growing demand among Chinese investors for diversified investment portfolios that include exposure to global markets [11][14] - The mutual recognition fund (MRF) program has seen significant growth, with a notable increase in assets under management for global multi-asset strategies [14] - The QDLP program is recognized as an important channel for investing in overseas alternative products, catering to professional investors with higher risk tolerance [15] Group 4: Market Dynamics and Investor Behavior - Investor confidence is recovering, leading to a renewed interest in complex alpha strategies such as private equity and asset-backed finance [25][26] - Private equity funds have become mainstream asset classes, with significant capital inflows driven by their active management and value creation capabilities [27][29] Group 5: Future Outlook - The ongoing evolution of cross-border financial mechanisms is expected to further enhance Hong Kong's status as a leading international financial center [16][20] - The European private equity market is seen as a historic investment opportunity due to current valuation discounts compared to the U.S. market [29]

Group 1 - The core viewpoint is that active fund managers must adopt hedge fund strategies to cope with the shift of funds towards low-cost passive management portfolios [1][2] - Olivier Nobille from Arkea Asset Management emphasizes the need for active funds to utilize mathematical models, algorithms, derivatives, and hedging techniques to enhance the likelihood of outperforming indices and provide stronger protection during market downturns [1][2] - Arkea Asset Management manages $55 billion in assets and has seen its two major funds outperform nearly 90% of their peers this year, with returns of 9% and 18% compared to a 12% increase in the Euro Stoxx 50 total return index [1] Group 2 - Over the past decade, only 14.2% of active fund managers in Europe have outperformed passive strategies, highlighting the challenges faced by active managers in justifying their higher fees [5] - The market has seen a significant influx into exchange-traded funds (ETFs) and other passive products due to their lower costs and better liquidity, making it increasingly difficult for active fund managers to demonstrate their value [2][5] - Nobille believes that smaller boutique firms will struggle to compete with larger asset management companies due to the lack of economies of scale, and the only way to justify higher fees is by offering unique products that employ hedge fund-like strategies [5] Group 3 - In late 2022, Arkea launched a series of thematic funds using a "layered strategy" designed to manage specific risks and enhance returns [8] - Stress tests simulating a market crash similar to 2008 indicated that the hedging strategy could offset about two-thirds of the decline [8]