April proved to be a bumper month for Asia's hedge fund industry, particularly for those exposed to China's equity market, figures show.

Hedge funds investing in China surged to a record monthly gain in April, as trading volume on the Shanghai-Hong Kong Stock Connect programme – aka the “Through Train” – surged and the Chinese central bank cut interest rates, data showed.

Figures from Chicago-headquartered Hedge Fund Research showed that its HFRI China Index rose by 13.0 per cent in April, which is the strongest monthly gain since the index's inception in 2008.

Total global capital invested in the Asian hedge fund industry surpassed $120 billion as the second quarter of 2015 began, and the number of Asian hedge funds approached 1,200, HFR said. Total capital invested in the global hedge fund industry, meanwhile, increased to a record $2.95 trillion.

The HFRI EM: Asia ex-Japan Index returned 10.5 per cent in April, its strongest gain since it rose by 11.3 per cent in December 1999. Through the first four months of 2015, the HFRI China Index and HFRI EM: Asia ex-Japan Index have risen by 18.8 and 14.5 per cent respectively, following more muted gains from 2014.

Inflows into Asian hedge funds through to the end of the first quarter of 2015 totalled $1.1 billion, the tenth consecutive quarter of inflows, with capital moving into emerging and pan-Asian funds only partially offset by outflows from Japan-focused funds.

Asian hedge fund inflows were also concentrated in equity hedge strategies, with these receiving inflows of $1.44 billion, partially offset by outflows across other strategies.

Total hedge fund capital invested in emerging Asia increased to $52.5 billion, while capital invested in pan-Asian hedge fund strategies increased to $39 billion. Total Asian hedge fund capital invested in Japan declined slightly to $29.2 billion.  The HFRI Japan Index advanced 5.0 per cent in April and has gained 7.8 per cent in the year to date, following a gain of 3.5 per cent in 2014.