Asian Hedge Fund's AI-Focused Strategy Delivers Over 100% Returns Year-to-Date
0xBroomberg
Several Asia-based hedge funds posted net returns above 100% in the first five months of the year by betting early on AI hardware and large-language-model plays — their edge: Asia hosts nearly the entire semiconductor supply chain, letting managers spot supply-side bottlenecks before global peers.
Which funds, and how much?
WT Asset Management's long-short China-focused fund returned a net 103% year-to-date through May, with May alone up over 20%; its long-only fund gained 67.5%.
E20 Capital, also Hong Kong-based and founded in 2025, posted 136% net returns on its $2 billion global opportunities fund — memory, optics and CPU-linked positions drove the gains.
Trivest Advisors, a long-standing tech-focused firm, returned 88.9% over the same period. None of the three responded to Reuters' requests for comment.
What exactly did they bet on?
WT's key winners included AI hardware plays plus Chinese tech names such as Hua Hong Semiconductor (688347.SS) and Zhipu AI (2513.HK).
Zhipu AI listed in Hong Kong in January; WT was a cornerstone investor — an early backer that commits to buy shares at the IPO — and the stock has since risen more than 1,000%.
This means → WT was not just picking stocks in the secondary market; it locked in AI exposure at the primary level. The earlier the bet, the larger the leverage on returns.
Why did Asia-based funds see it first?
Sources told Reuters that Asia covers nearly the full semiconductor supply chain, giving local managers an earlier read on supply-side constraints — bottlenecks where supply cannot keep up with demand.
In plain terms = chip design, foundry work, packaging and testing all cluster across Japan, South Korea, Taiwan and mainland China. If you live next to the factory floor, you are the first to know which production line is maxed out.
Navin Raj Jaidev, senior investment director at Cambridge Associates, said Asian AI supply-chain companies "remain underappreciated and overlooked by global investors" — a gap that keeps feeding alpha for regional funds.
How far has the broader market come?
South Korea's KOSPI is up nearly 100% year-to-date; Taiwan's weighted index has gained roughly 53%; Japan's Nikkei 225 is up about 31%; China's Shanghai Composite sits at its highest level in over a decade.
This reflects a sector-wide re-rating across the entire Asian supply chain, not a single-stock story. Index-level gains give stock-picking funds a rising tide beneath them.
Non-AI themes — corporate-governance reform and block trades — are also drawing capital, suggesting the inflows rest on more than one thesis.
Where is the risk from here?
Market turbulence triggered by the Iran conflict has not derailed the AI-driven rally; expanding demand and supply constraints continue to underpin valuations.
But as the AI hardware cycle matures, supply bottlenecks ease and valuation anchors shift higher — excess returns will naturally compress.
This means → the triple-digit gains of the first five months largely reflect a window of early discovery plus a supply-demand mismatch. Whether these funds can sustain outperformance depends on stock-picking skill in the second half of the cycle.
Content is for reference only, not financial advice.