THE founder of a top quantitative hedge fund in China bought a villa in Shanghai for 285.5 million yuan (US$39 million) in an online auction, scooping up one of the city’s most expensive homes for less than its appraised value.

The winning bid was about 10% lower than the 316.4 million yuan appraised value for the 1,300 square-meter property in the city’s Pudong District, according to records on Taobao’s auction platform.

Shanghai Minghong Investment Management Co. founder Qiu Huiming was the buyer, according to a person familiar with the matter.

Qiu previously worked for Millennium Management LLC and HAP Capital Advisors LLC in the United States, before returning in 2014 to start Shanghai Minghong. The firm is now one of the biggest quants in China, managing more than 60 billion yuan.

China’s quant funds have expanded rapidly in recent years as inefficiencies in retail investor-dominated markets provided fertile ground for algorithm-driven trading.

The industry is regaining popularity relative to discretionary traders amid volatile markets, even after its expansion drew regulatory scrutiny. (SD-Agencies)