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Hedge funds face tougher targets in Japan’s activist boom
Industry observers say the shift follows years when governance reforms helped activists generate strong returns.
Japan’s activist investing market is entering a tougher phase for hedge funds, as identifying and executing value-creation plans has become harder, according to a report cited by Hedgeweek that draws on Bloomberg’s findings.
Hedgeweek reports that several years of strong activist performance were supported by sweeping corporate governance reforms, which made it easier for hedge funds to unlock value at target companies.
Now, more challenging requirements for activist campaigns and targets are testing hedge funds, the outlet said, pointing to declining momentum in the strategy’s recent results.