The founder of a top quantitative hedge fund in China bought a villa in Shanghai for 285.5 million yuan ($39 million) in an online auction, scooping up one of the city’s most expensive homes for less than its appraised value.
(Bloomberg) — The founder of a top quantitative hedge fund in China bought a villa in Shanghai for 285.5 million yuan ($39 million) in an online auction, scooping up one of the city’s most expensive homes for less than its appraised value.
The winning bid was about 10% lower than the 316.4 million yuan appraised value for the 1,300 square-meter (14,000 square-foot) property in the city’s Pudong District, according to records on Taobao’s auction platform. Shanghai Minghong Investment Management Co. founder Qiu Huiming was the buyer, according to a person familiar with the matter, declining to be identified discussing private information.
Minghong declined to comment. Local newspaper China Securities Journal reported the identity of the buyer earlier.
Qiu previously worked for Millennium Management LLC and HAP Capital Advisors LLC in the US, before returning in 2014 to start Minghong. The firm is now one of the biggest quants in China, managing more than 60 billion yuan.
China’s quant funds have expanded rapidly in recent years as inefficiencies in retail investor-dominated markets provided fertile ground for algorithm-driven trading. The industry, managing about 1.6 trillion yuan, is regaining popularity relative to discretionary traders amid volatile markets, even after its expansion drew regulatory scrutiny and eroded returns in 2021.
Minghong ranked ninth among equity hedge funds managing more than 10 billion yuan in the first seven months of the year, with an 8.4% gain, according to Shenzhen PaiPaiWang Investment & Management Co. By contrast, China’s benchmark CSI 300 index returned less than 4% in the same period.
The Shanghai villa was sold on Alibaba Group Holding Ltd.’s auction site after its previous owner failed to repay more than 67 million yuan owed to a bank, according to the records.
China’s housing market has been in freefall for two years, with sales and prices plunging on weak consumer demand and a wave of debt defaults by some of the biggest developers.
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