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We have been advising on hedge fund investing for over 30 years. As one of the largest hedge fund allocators in the world, we have the scale and expertise to help our clients access the most sought-after managers.1
1) HSBC Asset Management, With Intelligence, as of June 2025 2) With Intelligence, as of June 2025
Diversify your portfolio with hedge funds
Hedge funds' flexible approach can help improve a portfolio’s performance during market downturns.
At HSBC Asset Management, we employ a multi-strategy approach that filters the hedge fund universe to find what we believe to be the best funds for our clients.
Opportunities offered by hedge funds
Absolute returns
Potentially benefit from both rising and falling prices through short selling.
Access to return streams inaccessible in traditional investments (e.g., special situations or distressed debt investing).
Diversification
Low correlation to traditional long-only assets.
Improved risk return profile by potentially lowering total portfolio volatility.
Flexibility
Well positioned to take advantage of changing market conditions.
Adaptable to the evolution of regulation and prevailing asset class volatility.
Aligned interests
Typically, the manager's own money is invested ("skin is the game").
Fee structures consist of a management fee and a performance fee.
The value of investing through a multi-manager approach
Expertise
Backed by well-established investment processes and well-resourced, experienced investment teams.
Diversification
Investing across a range managers and strategies helps to manage risks.
Access
Aims to offer access to leading hedge fund managers which may be closed to new investors.
Scale
Investing as part of a large asset base offers the potential for negotiating advantages with hedge funds.
Investing with HSBC Asset Management
Leader in our field
One of the largest hedge fund investors worldwide
Experience
Over 30-year+ history of providing hedge fund
solutions to both Institutions and private clients
Global presence
Drawing on HSBC’s scale, our global platform
supports local access and closer investment
monitoring
Hear from our clients
Client Testimonials – Charlie Hoffman
Past performance does not predict future returns. Diversification does not ensure a profit or protect against loss. There is no guarantee that HSBC AM Alternatives will successfully pick outperforming managers. The views expressed above were held at the time of preparation and are subject to change without notice. Any forecast, projection or target where provided is indicative only and is not guaranteed in any way. HSBC Asset Management accepts no liability for any failure to meet such forecast, projection or target.
Contact us
If you are considering investing in alternatives, or want to learn more about our investment strategies, please get in touch.
Investors in hedge funds should bear in mind that these products can be highly speculative and may not be suitable for all clients.
There are several key issues that one should consider before making an investment into hedge funds. The risks specific to this type of investment may include, but are not limited to:
The value of investments and any income from them can go down
as well as up and investors may not get back the amount originally invested.
Past performance does not predict future returns. The return may increase or
decrease as a result of currency fluctuations.
Regulation
The hedge fund industry is lightly regulated, with the majority of funds domiciled in offshore jurisdictions. Hedge funds are generally classified as “unregulated” and are not typically subject to the same levels of scrutiny and protection as a traditional investment fund. A thorough due diligence process can mitigate these concerns.
Gating
In event that redemptions requests on a particular dealing date are much higher than the normal level and full satisfaction would jeopardise the longer term portfolio balance, a gate or partial execution of redemption requests may be implemented generally on a pro-rata basis.
Side pocket
There may be instances when certain assets in a fund portfolio could become less liquid and the fund manager may segregate these illiquid positions from the main portfolio into a side pocket (or a separate vehicle).
Suspension of redemption
Suspension of redemption is a temporary halt in exiting the fund during a given redemption window. This is a stronger measure than gating because there is no dealing for the fund. This is generally used under special circumstances such as when liquidity conditions have markedly deteriorated in a short period of time or when there are heavy asset outflow such as the loss of a core investor.
Access
Hedge funds operate larger investment minima than traditional investment funds. Investors are often unable to access a hedge fund unless they were willing to invest USD500,000 to USD2m.
Transparency
Many hedge fund managers are wary of regularly publishing their positions in the belief that this will remove any advantage that they have over their peers. This can pose a problem to the investor, as he or she cannot be certain to which stocks, geographies, markets or even strategies he or she will be exposed to when investing in the hedge fund. However, trusted investors who have built strong relationships with the hedge funds can access this information for the majority of funds, enabling thorough monitoring of the investment.
Liquidity
Hedge funds typically have much longer dealing cycles than traditional investment funds. Depending on the strategy being utilised, a hedge fund may only allow subscriptions and redemptions on a monthly or quarterly basis. Furthermore, some hedge funds have long lock-up periods, where an investor is not permitted to redeem from the hedge fund unless a period of 6 months, a year or even 2 years has passed. Some may allow a redemption before the lock-up period is over, but the investor would have to pay a hefty penalty to be able to do this.
Manager failure
Over time, a number of hedge funds will close or fail, due to weak performance or operational difficulties. An investor must take this into consideration before making an investment, seeking professional advice to help minimise the risk of investing in a fund that is likely to fail.
The risk factors listed above are not exhaustive.
Contact us
If you are considering investing in alternatives, or want to learn more about our investment strategies, please get in touch.
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Categories of clients who are considered to be professionals:
Entities which are required to be authorised or regulated to operate in the financial markets. The list below shall be understood as including all authorised entities carrying out the characteristic activities of the entities mentioned: entities authorised by a Member State under a Directive, entities authorised or regulated by a Member State without reference to a Directive, and entities authorised or regulated by a third country:
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Investment firms;
Other authorised or regulated financial institutions;
Insurance companies;
Collective investment schemes and management companies of such schemes;
Pension funds and management companies of such funds;
Commodity and commodity derivatives dealers;
Locals: firms which provide investment services and/or perform investment activities consisting exclusively in dealing on own account on markets in financial futures or options or other derivatives and on cash markets for the sole purpose of hedging positions on derivatives markets or which deal for the accounts of other members of those markets or make prices for them and which are guaranteed by clearing members of the same markets, where responsibility for ensuring the performance of contracts entered into by such firms is assumed by clearing members of the same markets;
Other institutional investors;
Large undertakings meeting two of the following size requirements on a company basis:
balance sheet total: EUR 20 000 000
net turnover: EUR 40 000 000
own funds: EUR 2 000 000
National and regional governments, including public bodies that manage public debt at national or regional level, Central Banks, international and supranational institutions such as the World Bank, the IMF, the ECB, the EIB and other similar international organisations.
Other institutional investors whose main activity is to invest in financial instruments, including entities dedicated to the securitisation of assets or other financing transactions
The information presented may refer to HSBC Global Asset Management (France)'s global AUMs/figures and global policies. Even though local entities of HSBC Global Asset Management (France) may be involved in the implementation and application of global policies, the numbers presented and the commitments listed are not necessarily a direct reflection of those of the local HSBC Global Asset Management (France) entity.
Today, we and many of our customers contribute to greenhouse gas emissions. This is why HSBC Global Asset Management (France), together with other asset managers, have an important role to play in supporting the transition to a net zero economy. Step by step, we are developing strategies to reduce our own emissions and to help our customers reduce theirs. For more information visit https://www.assetmanagement.hsbc.com/about-us/net-zero
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