South Africa: The final frontier is gaining traction

Wed Apr 16, 2008

Gwyneth Roberts, editor, South AfricaHedge

Africa as the final frontier is a concept that has gained significant traction in the global hedge fund community over the past 12 months. While markets ex-South Africa and Egypt remain small and illiquid, returns have been attractive, particularly given their uncorrelated nature.

The South African hedge fund industry remains clearly dominant on the continent, given the more liquid and mature market compared with its neighbours. The country’s managers have built a strong reputation offering attractive risk-adjusted returns, and have been well supported by domestic investors, particularly from the institutional side via funds of hedge funds. Assets under management climbed to around $4 billion in 2007, up from $3 billion in the previous year, with around 130 hedge funds operating in the country. Moreover, the rise in assets was much more pronounced in local currency terms – from R20 billion to R32 billion – or...

ISSN: 2151-1845 / CDC10004H

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