HSBC GAM hard closes Asia ex-Japan small caps fund

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HSBC Global Asset Management has announced it is hard-closing its HSBC GIF Asia ex Japan Equity Smaller Companies fund to new subscriptions from all investors as its assets hit $1.3bn.

Managed by Elina Fung and Alex Kwan, the fund invests in the bottom 25 per cent of companies by market capitalisation.

According to FE, it has returned 45 per cent over the last year.

HSBC says periods of volatility have resulted in challenging liquidity conditions and the move is in the best interests of existing investors. It notes that if AUM falls below the hard close threshold the decision may be reversed.

The move is effective from 10 May.

Stephen Kam, Senior Product Specialist, Asian Equities, HSBC Global Asset Management, commented: “As liquidity is generally much lower for companies in the small cap universe compared to the overall market, investment opportunities can become more limited as subscriptions to the fund increase.

“We have seen great investor interest in the fund on the back of strong performance and therefore have capped the size of the fund to ensure we protect the interests of our existing investors. The decision also allows our investment team to continue to invest in similar opportunities that have helped generate the strong returns seen in the past.”

The fund currently invests in companies with a market cap below $4bn.