Everest, Hillhouse and Others Are Betting on a China Equity Rebound

December 06, 2012   Jan Alexander

While some hedge fund managers are still bearish on China, equity-focused managers say there are still bargains to be had, despite the macro picture.

Marko Dimitrijevic, founder and CIO of Miami-based emerging markets hedge fund firm Everest Capital, sold off most of his fund's short positions in Chinese equities earlier this fall, not to get out of China but to increase the fund's holdings through long positions. He and Matthieu Vermersch, who heads Everest's Asia operations from their offices in Singapore, have been bracing for a slight improvement in China's economy, though they believe it doesn't really matter if China's GDP grows 7 percent or 9 percent this year.

"The world is focused on big macro numbers for China, but that's not so important for the value of listed companies," says Vermersch.

Not everyone shares this view. Indeed, hedge fund managers like Hugh Hendry, CIO of London-based Eclectica Asset Management, have been loudly and frequently explaining for some time why they are short China. At a conference...

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