Standard Chartered is increasing its focus on hedge funds as wealth management clients seek to diversify portfolios and navigate heightened market volatility. According to reports from Reuters, the Asia-focused bank is helping its wealth management clients allocate part of their portfolios to hedge funds as investors look for ways to reduce the impact of market volatility and diversify beyond traditional stocks and bonds. Samir Subberwal, StanChart's global head of wealth solutions, retail products, data and analytics, emphasized the strategic value of these offerings, stating that "this is a good product to offer to clients as something that gives them a little bit of a hedge and stable returns." The bank is placing greater emphasis on hedge fund strategies as alternative investments gain traction globally, with particular focus on equity market neutral and multi-strategy funds that aim to generate returns with relatively low correlation to broader markets.
Global hedge funds delivered impressive returns during the first half of 2026, with average returns of 7% significantly above their 10-year average annual return of 4.1%, according to a Goldman Sachs note cited in the report. As reported by Reuters, data from industry research firm HFR showed that hedge fund assets under management increased by a record $409 billion in the latest quarter to $5.6 trillion. Subberwal noted that "the performance of these hedge funds have actually been quite resilient over the last few years," highlighting their appeal as alternative investments that can potentially provide more resilient returns during periods of turbulent markets. This strong performance is driving increased interest among affluent investors in Asia, who are seeking alternative investments that can potentially provide more resilient returns during periods of turbulent markets.
Wealth income surged 38% during the period, with investment products recording double-digit growth as increased market volatility encouraged more clients to seek professional wealth advice. According to Reuters, products that saw particularly strong demand included managed investments such as public funds and variable capital companies, structured products and cash equities. Subberwal explained that "hedge fund allocations will be a key focus for StanChart, as it is about completing the suite of products so we can help clients diversify their portfolios and be able to manage the volatility of markets much better." Rising inflows and an increase in new client accounts also contributed to the growth, with the bank's broader strategy focusing on expanding the range of investment products available to clients while helping them build more diversified portfolios.
Standard Chartered's push into hedge fund allocations highlights the broader shift among wealthy investors toward alternative assets, as traditional portfolios face greater uncertainty from changing interest rates, geopolitical risks and volatile equity markets. As reported by Reuters, the move also comes as Standard Chartered seeks to capitalise on the rapid growth of affluent populations across Asia and expand its wealth management business. The bank's strategic focus on hedge funds represents a significant expansion of its alternative investment offerings to meet growing client demand for diversified portfolio solutions. This strategic positioning aligns with the bank's forecast-beating first-half profit, which was driven by a surge in wealth and global banking revenue as wealth income soared 38%.
