New Silk Road Investment Pte, one of Singapore’s oldest homegrown hedge funds, is winding down operations after years of underperformance and a sharp exodus of capital, especially from once-loyal U.S. institutional investors, according to Bloomberg.
Founded in 2009 by former Deutsche Bank executive Yik Luen Hoong and ex-GIC equities head Raymond Goh, the firm was once an early investor in Chinese markets and a trailblazer in Singapore’s nascent hedge fund scene. But after peaking with nearly $2 billion in assets under management in 2021, New Silk Road’s AUM plunged to just $615 million by the end of 2023.
“All remaining capital will be returned to investors and the vehicles shuttered,” Hoong told Bloomberg via email, citing dwindling interest in Asia-focused public equity strategies from U.S. backers, particularly amid intensifying geopolitical tensions.
The closure marks the end of an era for the Singapore-based hedge fund, which had built its early reputation on deep fundamental research and was among the first batch of foreign investors to receive a Qualified Foreign Institutional Investor (QFII) license from China’s securities regulator in 2012. The firm once had a team embedded in Shanghai, and was considered a relatively rare Asia-focused value shop supported by blue-chip institutions.
However, returns faltered in recent years. According to people familiar with the matter, three of the past five years were marked by losses in both its flagship Asia Landmark Fund and China Fund — with 2022 bringing drawdowns of 28% and 19%, respectively. That same year, the CSI 300 Index dropped by 22%, reflecting broad pain across China-exposed portfolios.
New Silk Road made efforts to adapt, cutting headcount in its Shanghai office and shutting down a newer Southeast Asia fund earlier this year. But ultimately, Hoong said, the market shifted in ways that made it difficult for value-oriented, long-term investors to survive.
“We are just one of many active value funds in Asia that have not been the favor of the time,” he told Bloomberg. “The market disfavours longer-term fundamental investing approaches with a value bias.”
While geopolitical anxieties and shifting U.S. capital flows played a major role in the fund’s decline, the firm was not forced to shut down due to financial distress, Hoong emphasized. Instead, both founders—now in their 60s—decided the time was right to step back from the industry, with no clear successor ready to take over.
“It’s as simple as two veterans choosing a different path in life,” Hoong said.
New Silk Road’s closure comes amid an increasingly Darwinian environment for smaller hedge funds globally, as mega-managers with multi-strategy platforms continue to dominate asset flows. Singapore remains a vibrant hub for asset management, with the Monetary Authority of Singapore reporting S$327 billion in hedge fund AUM as of December 2023 — up from just S$59 billion when New Silk Road was founded.
Still, the firm’s story reflects the mounting challenges facing boutique asset managers operating at the intersection of Asia’s complex markets and the shifting priorities of global investors.
