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Hedge funds

We have been at the forefront of the hedge fund industry, investing in, and selecting, hedge funds for over a quarter of a century.

How we help you invest in hedge funds

Hedge Funds are sophisticated investment avenues, encompassing a wide array of trading strategies across different asset classes and markets. They utilize advanced techniques, including short selling, to mitigate market risks and aim for positive returns regardless of market trends. Suitable for experienced and well-informed investors, these funds can pose significant risks. At HSBC, we leverage our extensive global expertise and rigorous due diligence processes, honed since 1989, to provide our clients with tailored hedge fund investment advice, navigating them through the complexities of the hedge fund landscape and its ongoing evolution.

  • Enhanced returns: Incorporating hedge funds into your portfolio can refine its risk-return dynamics. This is due to hedge funds' ability to capitalise on both upward and downward market trends, including employing strategies like short selling. Such versatility provides unique return opportunities not typically available through traditional investments
  • Portfolio diversification: Hedge funds introduce a broader spectrum of investment strategies to a traditional portfolio, thereby injecting a layer of diversified returns. Especially in scenarios of rising interest rates, the active management approach favoured by hedge funds can be particularly advantageous due to their ability to exploit market volatilities and reduced correlations
  • Alignment of interests: A distinctive feature of hedge funds is the significant personal investment of managers in their funds, ensuring a strong alignment of interests with investors. Furthermore, the dual fee structure—comprising both a management fee and a performance fee—motivates managers to strive for positive returns, directly linking their compensation to the fund’s performance
  • Access to expertise: Access to skilled active management. Portfolio Managers interest are aligned with their clients as typically a substantial amount of the manager’s own money is invested in the sophisticated strategies. 


Hedge Funds at HSBC

  • Vast experience: At HSBC, our client-centric approach, combined with our rich experience and deep insights, cements our robust reputation in hedge fund investments
  • Strong industry relationships: Our longstanding relationships with leading hedge funds worldwide enables us to leverage these relationships for enhanced manager engagement on our esteemed platform, fostering greater transparency and deeper insights
  • Global investment framework: Our comprehensive global investment infrastructure ensures the implementation of rigorous governance and extensive risk oversight across all invested hedge funds and client portfolios, both commingled and customised
  • Industry recognition: With vast experience and proven track record, we are today amongst the largest hedge fund investors globally and have received numerous industry awards
  • Investment philosophy: We believe that markets contain inefficiencies which can be exploited by hedge fund managers who exhibit the skill necessary to deliver excess returns. We identify such talent through our global, dynamic, and proven research process

What are hedge funds?

If you've ever wondered about hedge funds – what they are, who they're suitable for, and how they function in the financial market – then this video is for you. We break down the complex walls of hedge funds into easily digestible nuggets of information.

Watch the video: Hedge Funds Explained

Introduction to hedge funds

Join Emma Cory, our Alternatives Specialist, and Julian Romero, Head of Institutional Portfolio Management, as they explore the Hedge Funds asset class. Gain new insights for your investment strategy as our experts guide you through what Hedge Funds are, how they work, and why they could be a valuable addition to your investment portfolio.

Watch the video: Introduction to hedge funds

Unique benefits


HSBC lowers the barrier to entry for institutional investors through its platform, providing access to exclusive institutional share classes at lower minimum investments.


Gain an edge with the substantial leverage opportunities HSBC offers on investments in hedge funds, enhancing your potential returns.

Secondary market access

Leverage HSBC's vast internal market to tap into otherwise inaccessible hard/soft closed funds, a privilege made possible by the bank's extensive size and reach.

HSBC network

Benefit from early access to sought-after, capacity-limited hedge funds, thanks to HSBC Group's being one of the largest global investors in the hedge fund sector.


Since 1989, our track record stands testament to our expertise and commitment to our clients.


HSBC's global trading teams are equipped to promptly execute trades, ensuring you can move swiftly to capitalize on market opportunities.

Our Offering

We pride ourselves on our expansive hedge fund platform, offering a comprehensive range of options tailored to our clients' unique investment preferences, knowledge, and needs. Whether it be through our diversified fund of funds, bespoke single-line solutions, or custom mandates, our team is dedicated to collaboratively identifying the optimal investment strategies for our clients. 

To learn more about our hedge fund product suite please contact your Relationship Manager.

Risks of investing in private markets

The value of investments and any income from them can go down as well as up and investors may not get back the amount originally invested. Past performance information presented is not indicative of future performance. The return and costs may increase or decrease as a result of currency fluctuations. 

  • Liquidity Risk - Investors may be unable to dispose of an investment quickly and at a price that’s closely related to recent similar transactions. There is no guarantee of distributions and no established secondary market.
  • Event Risk - A significant event may cause a substantial decline in the market value of all securities. 
  • Long-term Horizon - Investors should expect to be locked-in for the full term of the investment, which is subject to extensions.
  • No Capital Protection - Investors may lose the entirety of invested capital.
  • Unpredictable Cashflows - Capital may be called and distributed at short notice.
  • Economic Conditions - Ability to realise/divest from existing investments depends on market conditions and the regulatory environment.
  • Risk of Forfeiture - Failure to make call payments could result in forfeiture of commitment, including invested capital, without compensation.
  • Default Risk - in the event of default investors risk losing their entire remaining interest in the vehicle and may be subject to legal proceedings to recover unfunded commitments.
  • Reliance on Third-party Management Teams - Underlying investments will be managed by various third-party management teams that will in aggregate determine the eventual returns for the investor.

The risk factors listed above are not exhaustive, always refer to product specific documentation for full details and risk disclosures. 

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