Even though 2020 was a challenging year due to the COVID-19 pandemic, the Cyprus fund industry has proven its resilience and continued attracting both promoters and fund managers. “To this end, at the end of the second quarter of 2020, Total Assets Under Management increased to almost €8.6 billion, equaling to an annual increase of 3.8%” said Mr. Andreas Yiasemides, President of Cyprus Investment Funds Association (CIFA).
Israel is experiencing an even bigger growth, and according to Ms. Lital Dagan, CEO of Israel Hedge Funds Association (IHFA), “the hedge funds industry in Israel includes over 170 active hedge funds that manage approximately $10B in Assets Under Management (AUM). This is a 20% growth in AUM since last year. Since 2007, the TGI Index, the index of the hedge funds industry in Israel, has returned 190% more than the Tel Aviv 125 Index”.
Today, CySEC has under its supervision a total of 266 Management Companies and Undertakings of Collective Investments in Transferable Securities (UCITs) compared to 102 in 2016, an increase of more than 160%
Ms. Demetra Kalogerou, Chairwoman of CySEC
Given this recent growth in both countries, seeking deeper bilateral cooperation was a matter of time. Cyprus combines many features that make the country a robust investment destination. “We have at our disposal a highly sophisticated pool of talent in financial and professional services, which combined with a competitive tax framework and a low-cost Mediterranean lifestyle give Cyprus a prime position for foreign investors outside the EU to access the region’s deep capital markets” explained Ms. Demetra Kalogerou, Chairwoman of Cyprus Securities and Exchange Commission (CySEC). Indeed, Israeli funds established in Cyprus can benefit from the EU passport, offering fund managers cross-border fund distribution. “The main advantage in Cyprus is that it is a gateway to the EU, and under certain conditions, the fund managed by Israelis can be marketed to EU residents. Cyprus has the potential to become a European hub of funds” added Dagan.
The hedge funds industry in Israel includes over 170 active hedge funds that manage approximately $10B in Assets Under Management (AUM)
Mr. Lital Dagan, CEO of IHFA
Kalogerou notes that Cyprus has developed and grown an established collective investment funds industry over the last 9 years. “Today, CySEC has under its supervision a total of 266 Management Companies and Undertakings of Collective Investments in Transferable Securities (UCITs) compared to 102 in 2016, an increase of more than 160%” she explained.
Similarly, the Israeli hedge funds industry has become a significant part of its domestic capital market. “Today we are witnessing a thriving local industry that helps to develop Israel’s economy and capital markets. In fact, Israeli funds returned 85% since 2013” said Dagan.
We are optimistic that the industry will soon reach the €20 billion threshold in Assets Under Management, but we are determined that this growth will be done the right way
Mr. Andreas Yiasemides, President of CIFA
“The message for our Israeli friends is to explore the Cypriot funds’ ecosystem. To contact local professionals and authorities, to get to know first-hand how Cyprus can be the ultimate jurisdiction to set up their fund and fund management structures” said Yiasemides. “We are optimistic that the industry will soon reach the €20 billion threshold in Assets Under Management, but we are determined that this growth will be done the right way.”