New York-based Mass Ave Global liquidates China-focused funds -documents

By Xie Yu and Summer Zhen

HONG KONG (Reuters) – Mass Ave Global, a New York-based hedge fund with $1.1 billion of assets under management, has decided to close its China and Asia-focused funds, letters to investors seen by Reuters showed.

The firm is also winding down its office in Hong Kong, four sources familiar with the matter said.

“After careful consideration, we have determined that it is in the best interest of the master fund, the offshore fund and the U.S. fund that all investors will be compulsorily redeemed and withdrawn,” said one of the letters, dated March 2, to investors of its flagship Mass Ave Global Partners Fund.

The letter did not cite a specific reason for the liquidations, which it said were expected to completed by June 30. It noted that Ray Guo, also known as Yirui Guo, co-founder of the company, resigned as head of research in February and Justin Dew, president, chief operating officer and chief compliance officer also left the firm last month.

The first distribution of proceeds to investors will start before June 30, the letter added.

The sources were not authorised to speak to media and declined to be identified. Mass Ave did not immediately respond to a Reuters request for comment.

The news follows a bruising year for China-focused managers in 2022 with many logging heavy losses as economic growth slowed, hurt by the country’s now-abandoned zero-COVID policy and geopolitical tensions.

A filing with U.S. regulators last month showed Mass Ave’s U.S.-listed holdings valued at $342.4 million, with e-commerce giant Alibaba Group Holding Ltd the top holding.

Mass Ave launched its China/Asia-focused flagship fund in October 2019 as a long/short equity hedge fund, according to data provider Preqin.

The fund lost 16% in 2022 after gains of 15% in 2021 and 51% in 2020. It was up 5% in January, according to data from HSBC.

(Reporting by Xie Yu and Summer Zhen; Additional reporting by Julie Zhu in Hong Kong; Editing by Edwina Gibbs)