As Singapore hedge-fund assets swell to $59 Billion,

will the city-state have enough room for more investments?

Hedge-fund assets in Singapore more than doubled to about S$80 billion ($59 billion) at the end of last year, contributing to a 32 percent growth in the city's asset management industry, the central bank said.

The number of hedge-fund managers increased by more than 50 percent to almost 300 at the end of 2007, the Monetary Authority of Singapore said in its annual survey of the city's asset management industry.

“The profiles and investment strategies of the hedge fund managers in Singapore are highly varied and diverse,” the central bank said.

Singapore has sought to transform the island into a center for hedge funds by offering tax incentives and making it easier for them to obtain licenses than other Asian cities such as Hong Kong and Tokyo.

Total assets managed by Singapore-based managers rose to S$1.17 trillion, from S$891 billion at the end of 2006, the seventh consecutive year of “double-digit” year-on-year growth, the central bank said.

About 86 percent of the total assets last year were sourced from overseas, almost half of which came from the Asia-Pacific region. Managers allocated about 57 percent of the total assets into equities and 12 percent into alternative investments such as hedge funds and private equity, two percentage points higher than in 2006, the central bank said. Investments in bonds fell five percent to 12 percent of all assets.

The number of firms managing more than S$5 billion in assets increased 23 percent last year, and accounted for 47 percent of the total assets in the city state.
The number of investment professionals, including portfolio managers, traders and analysts, rose 22 percent to 2,185, the central bank said.


Will Singapore ever reach an “investment saturation point”? What may or may not cause this?