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* Two Richland funds manage about $100 mln
* Richland also advises on $150 mln for wealthy clients
* Richland's main fund made money every year since its 2006launch
By Nishant Kumar
HONG KONG, April 30 (Reuters) - Hong Kong-based RichlandCapital Management Ltd is shutting down its hedge fundoperation, Chief Investment Officer Alex Au told Reuters onTuesday, a major blow to an industry struggling to raise assetsand turn a profit for investors in Asia.
The decision to close down is unexpected as Richland hasoutperformed peers in the $133 billion Asian hedge fund industrysince it was launched in 2006.
Richland, one of the best-known in the region, managesassets worth $100 million between two hedge funds and advisesclients on assets worth an additional $150 million, according toits letter to investors.
"The funds have liquidation date today," said Au, confirmingan earlier Reuters report. He did not give a reason.
Au, a former HSBC Holdings Plc trader founded thefund in 2006 with Eva Lo, a former Credit Suisse Group AG executive.
Richland made money for its Asia Absolute Return Fund eachyear since its launch, including a 5.3 percent gain in 2008,when the global financial crisis unfolded.
Lo is not involved in managing portfolios but both partnershave an equal say in running the firm.
Typically, hedge funds shut down in response to poorperformance or clients withdrawing large amounts of money,problems Richland did not suffer.
The Richland Asia Absolute Return Fund managed about $75million in February this year compared to $10 million when itwas launched in Dec. 2006, the investor newsletter showed.
The fund gained 14.1 percent in 2012 and was up about 6percent in the first quarter of 2013, according to fundperformance data seen by Reuters, outperforming a 10 percentgain in the benchmark Eurekahedge Asia index last year and 5.8percent in the March quarter.
A second fund, the Richland Emerging Opportunities Fund,returned 13.1 percent last year and was up about 18 percent inthe first quarter of 2013.
So far, 23 hedge funds have shut down in Asia, compared with18 launches, according to data from Eurekahedge. Last year, 169hedge funds closed in Asia, exceeding 139 launches.
