Hedge Fund Singapore

A hedge fund in Singapore is a private, actively managed investment fund that uses sophisticated strategies — including leverage, short-selling, and derivatives — to generate absolute returns regardless of market direction. Singapore hedge funds are regulated by MAS and generally only accessible to accredited or institutional investors. Not financial advice.

Singapore is Asia’s third-largest hedge fund hub after Hong Kong and Tokyo, managing an estimated USD 100+ billion in hedge fund assets as at Q1 2026.

Table of Contents
  1. What Is a Hedge Fund?
  2. Hedge Fund Strategies Used in Singapore
  3. MAS Regulation of Hedge Funds
  4. Fee Structure: 2-and-20
  5. Hedge Funds vs Unit Trusts vs ETFs
  6. How to Access Hedge Funds in Singapore
  7. FAQ

What Is a Hedge Fund?

Unlike mutual funds that aim to beat a benchmark, hedge funds target positive absolute returns — making money whether markets rise or fall. They use strategies not permitted in retail funds: short-selling, derivatives, and concentrated positions. The common thread is that they operate with far fewer regulatory constraints than retail funds.

Hedge Fund Strategies Used in Singapore

Long/Short Equity: Buys stocks expected to rise, short-sells stocks expected to fall. Many Singapore-based managers focus on Asia-Pacific equities. Global Macro: Large directional bets on currencies, interest rates, and commodities. Singapore’s position as a forex hub makes it a natural base. Relative Value/Arbitrage: Exploiting price discrepancies between related securities, such as S-REIT units vs NAV. Multi-Strategy: Combining approaches to reduce concentration risk.

MAS Regulation of Hedge Funds

Hedge fund managers require a Capital Markets Services (CMS) licence from MAS. Small managers (<SGD 250m AUM, <30 qualified investors) may apply for Registered Fund Management Company (RFMC) status. Larger managers need a Licensed Fund Management Company (LFMC) licence. Singapore’s Variable Capital Company (VCC) structure, introduced in 2020, is popular for hedge fund incorporation — over 1,000 VCCs have been incorporated as at Q1 2026.

Fee Structure: 2-and-20

The traditional fee is “2-and-20”: 2% annual management fee plus 20% performance fee. In Singapore, fee pressure has reduced this — many managers now charge 1–1.5% management and 15–20% performance, with high-water marks standard.

Hedge Funds vs Unit Trusts vs ETFs

Unit trusts are retail-accessible MAS-authorised funds with strict guidelines. ETFs trade on SGX and track indices. Hedge funds are unlisted, restricted to accredited investors, with active strategies. Liquidity differs significantly — ETFs trade continuously; many hedge funds have quarterly redemption windows and lock-up periods. For retail investors, robo advisors and unit trusts are more accessible options.

How to Access Hedge Funds in Singapore

Accredited investors (net assets ≥ SGD 2 million or income ≥ SGD 300,000) can access hedge funds through private banks (DBS Private Bank, OCBC Premier, UOB Private) or direct fund subscriptions. Minimum investments typically start at USD 100,000–500,000. See our accredited investor guide.

Frequently Asked Questions

Can retail investors invest in hedge funds in Singapore?
No. Singapore hedge funds are generally restricted to accredited investors (net assets ≥ SGD 2 million, annual income ≥ SGD 300,000, or net financial assets ≥ SGD 1 million) or institutional investors.
What is a Variable Capital Company (VCC) in Singapore?
A VCC is a Singapore-specific corporate structure for investment funds introduced in 2020. It allows hedge funds to ring-fence assets across sub-funds. Over 1,000 VCCs have been incorporated since launch as at Q1 2026.
What are typical hedge fund fees in Singapore?
The traditional 2-and-20 model has evolved. Many Singapore managers now charge 1–1.5% management and 15–20% performance, with high-water marks to prevent double-charging after losses.
How are hedge funds taxed in Singapore?
Singapore does not tax capital gains. Fund income may qualify for tax incentives under MAS-approved schemes such as the Section 13O/13U Enhanced Tier Fund Tax Exemption, exempting qualifying funds from Singapore income tax on specified income.
What MAS licence does a hedge fund manager need?
Hedge fund managers need a Capital Markets Services (CMS) licence for fund management. Smaller managers can register as RFMC (under SGD 250m AUM, fewer than 30 qualified investors). Larger managers require an LFMC licence.