Asia hedge funds deliver triple-digit returns riding AI supply chain and semiconductor boom

Global Markets: AI supply chain bets propel Asian hedge funds to stellar performance

Asia-focused hedge funds delivered outsized returns in 2026 by riding the artificial intelligence boom across semiconductors and related technologies. Strong demand for AI infrastructure, coupled with supply constraints, lifted regional markets and helped fund managers uncover opportunities across Asia's expanding technology ecosystem. Asia-focused hedge funds have emerged as some of the biggest beneficiaries of the artificial intelligence boom, with several delivering triple-digit returns in the first five months of 2026 by capitalising on investments across the semiconductor and AI ecosystem. The strong gains underscore that the AI-driven market rally has remained resilient despite bouts of volatility triggered by geopolitical tensions, including the conflict in Iran. Rising demand for AI infrastructure and supply-side constraints across the semiconductor industry have helped propel technology stocks higher, driving benchmark indices in Japan, South Korea and Taiwan to record levels. US MarketsPowered By As on 13 Jun 2026, 01:30 AM IST S&P 500 Top Gainers Mosaic22.69(7.59%) Albemarle170.42(7.40%) Seagate Technology Hldgs931.04(7.25%) Intel124.57(6.51%) Gainers" S&P 500 Top Losers Coterra Energy32.56(-8.62%) Adobe204.02(-6.76%) Kellanova32.99(-6.28%) Lennar90.30(-4.90%) Losers" Hong Kong-based WT Asset Management's long-short China Focus fund generated a net return of 103% between January and May, aided by a gain of more than 20% in May alone. The firm's long-only fund advanced 67.5% during the same period. WT's performance was driven by investments in AI hardware companies and Chinese technology firms, including semiconductor manufacturer Hua Hong Semiconductor and AI agent developer Knowledge Atlas, also known as Zhipu AI. Public filings show WT was a cornerstone investor in Zhipu AI, whose shares have surged more than tenfold since its Hong Kong market debut in January. Sources familiar with the matter told Reuters that the firm's assets under management have expanded rapidly and now stand at around $10 billion. Other technology-focused investment firms have also posted exceptional returns amid the AI surge. Hong Kong-based E20 Capital, which was launched in 2025, delivered a net gain of 136% in the first five months of the year. The performance was supported by investments in memory-chip makers, optical technology companies and CPU-related businesses through its flagship Global Opportunity Investment Fund, which manages approximately $2 billion in assets. Meanwhile, Reuters reported that Trivest Advisors, a long-standing technology-focused investment firm, generated an 88.9% return during the January-May period. WT Asset Management declined to comment on its performance, while E20 Capital and Trivest Advisors did not respond to requests for comment. Market participants said that Asian investors were particularly well positioned to identify opportunities in the AI supply chain because the region encompasses nearly the entire semiconductor manufacturing ecosystem. This proximity allowed fund managers to recognise supply bottlenecks early and build positions across multiple AI-related segments before global investors fully appreciated the trend. The broader market backdrop has also been supportive. China's benchmark Shanghai Composite Index has climbed to its highest level in more than a decade. South Korea's KOSPI has nearly doubled this year, while Japan's Nikkei 225 and Taiwan's benchmark weighted index have gained approximately 31% and 53%, respectively. Experts told Reuters that Asia continues to offer significant opportunities for investors seeking outsized returns. He noted that many AI supply-chain companies in the region remain under-researched and receive limited attention from international investors. They also highlighted emerging investment themes beyond artificial intelligence, including corporate governance reforms and block-trade opportunities, which are attracting increasing interest among institutional investors across Asian markets. (Disclaimer: Recommendations, suggestions, views, and opinions given by experts are their own. These do not represent the views of the Economic Times.)

Asia hedge funds notch triple-digit gains in AI-led rally

HONG KONG, June 15 (Reuters) - Some Asia hedge funds delivered returns exceeding 100% in the first five months of the year, riding on record highs in stock markets and wagers on AI hardware and large language model leaders, according to sources familiar with the performance. Market participants say regional funds were quicker to spot supply-side constraints as Asia covers nearly the entire semiconductor stack, allowing them to position early and capture opportunities across AI subsectors. The performance highlights how market volatility induced by the Iran war has not derailed the AI-driven rally this year, as growing demand and tight supply lifted stocks and pushed Japan, South Korea and Taiwan to record highs. Hong Kong's WT Asset Management saw its long-short China Focus fund book a net return of 103% in the year to date end-May, after rising more than 20% in May alone. Its long-only fund was up 67.5%, a source familiar with the matter told Reuters. Bets on AI hardware as well as China's domestic techs, such as chipmaker Hua Hong Semiconductor and AI agent Knowledge Atlas, contributed to the performance, the source said. Public filings show WT was a cornerstone investor in Knowledge Atlas, known as Zhipu AI, whose shares have surged more than 1,000% year-to-date following its Hong Kong listing in January. Assets under management at WT, run by veteran investor Wong Tongshu, have since grown rapidly to around $10 billion, another source said. Other tech-focused funds have also ridden the wave. E20 Capital, a Hong Kong-based hedge fund launched in 2025, posted a net gain of 136% in the first five months, with its position in memory, optics and CPUs boosting returns at flagship $2 billion Global Opportunity Investment Fund, a source said. Meanwhile, long-time tech investor Trivest Advisors gained 88.9% in the first five months of the year, according to another source. WT Asset Management declined to comment, while E20 Capital and Trivest Advisors did not respond to Reuters requests for comment. China's Shanghai Composite has climbed to its highest level in more than a decade. South Korea's KOSPI has surged almost 100% so far this year, while Japan's Nikkei 225 and Taiwan's weighted index have risen roughly 31% and 53%, respectively. Navin Raj Jaidev, a senior investment director at Cambridge Associates, said Asia offers increasing opportunities to deliver outsized returns, as many AI supply-chain firms in the region "remain under-covered and under-recognised by global investors." He added that themes such as corporate governance reforms and block trades are gaining traction. (Reporting by Summer Zhen; Editing by Kim Coghill)