Retail lifts South African hedge fund assets to ZAR216bn

The Association for Savings and Investment South Africa (ASISA) reported hedge fund assets under management climbed 17% to ZAR216bn in 2025 from ZAR185bn a year earlier. The industry comprised 219 hedge funds run by 13 investment firms at year-end. Net inflows for the sector totaled ZAR6bn, while investment returns accounted for most of the overall increase.

Retail hedge funds held 56.6% of industry assets at the end of 2025, surpassing qualified investor funds. Retail vehicles attracted ZAR9.1bn in net inflows during the year. Qualified investor funds recorded net redemptions of ZAR4.3bn.

Allocation patterns shifted in 2025. Multi-strategy funds drew the largest inflows, with retail investors placing ZAR7.5bn and qualified investors adding ZAR1.1bn. Long-short equity funds saw outflows: retail long-short strategies posted net withdrawals of ZAR1.7bn and qualified investor long-short funds had outflows of ZAR5.6bn. Fixed-income hedge funds attracted ZAR3.3bn from retail investors and ZAR226m from qualified investors.

South Africa’s National Treasury, in its 2025 Budget Review, reiterated the role of collective investment schemes, including retail hedge funds, as regulated vehicles for long-term savings and outlined planned tax amendments aimed at greater certainty for investors. Industry participants welcomed the tax proposals. Stakeholders are also monitoring potential changes to Board Notice 90, which currently restricts some unit trust investments in hedge funds; proponents say revising the notice could expand access and draw additional institutional capital.