Hedge Fund Products Record 45% Year-on-Year Growth Amid Renewed Investor Confidence
China’s private securities fund industry is experiencing a robust recovery in product registrations, with data showing a significant year-to-date increase as market risk appetite strengthens.
Accelerating Growth in Fund Launches
According to statistics from private fund research firm Simuwang, the industry registered 4,361 private securities products in the first five months of 2025 – marking a 45.03% increase compared to the same period last year. The momentum accelerated in May alone with 870 product registrations, representing a striking 77.19% year-over-year surge.
Quantitative funds managed by industry leaders emerged as particularly popular among investors, attracting substantial capital inflows. Market observers attribute this resurgence to growing optimism about China’s economic restructuring and potential structural bull market conditions.
Drivers Behind the Resurgence
Li Chunyu, FOF fund manager at Rongzhi Investment, identified multiple factors fueling the private fund boom:
- “First, the stabilization and recovery of A-shares, particularly in innovation-driven sectors like AI, new energy, and semiconductors, has significantly improved risk appetite,” Li noted. “Second, regulatory improvements have enhanced transparency and operational standards across the industry.”
- The strong performance of private securities products, especially quantitative strategies demonstrating consistent alpha generation, has further attracted investor interest. Product innovation and strategy diversification have also created more tailored options for varying risk preferences.
Industry Scale Rebounds Past 20 Trillion Yuan
Latest data from the Asset Management Association of China (AMAC) reveals the private fund industry’s total assets under management reached 20.22 trillion yuan by April 2025, with private securities funds accounting for over 5 trillion yuan.
This marks the industry’s return to the 20 trillion yuan threshold after a one-year hiatus, driven by both the product registration rebound and performance recovery across private fund strategies.
Analysts suggest the resurgence reflects accumulating social confidence following trade-related challenges, with increasing participation from medium-to-long term investors potentially paving the way for sustained market growth. The private fund industry’s revival serves as a barometer for renewed institutional optimism in China’s capital markets.
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