Sitting in his Tokyo office, Edward Rogers bellows with laughter. In the five difficult years since he launched his own fund-of-hedge-funds firm, the CEO and CIO of Rogers Investment Advisors has kept his sense of humor.

Although some might question the sanity of opening a hedge fund business in Japan, Rogers’s good cheer and persistence in rough markets have paid off. As of September 30 the $100 million Wolver Hill Japan Multi-Strategy Offshore Fund he advises had gained an annualized 2.4 percent since its October 2006 inception. The Tokyo Price Index fell 14.4 percent during the same stretch, while the Eurekahedge Japan Hedge Fund Index rose just 0.7 percent.

Rogers, 46, beat the indexes with one quarter the volatility of the Topix. “Hedge funds are absolutely the smartest way — quite possibly the only sensible way — to invest in Japanese public equities,” he says. “We have allowed our investors to sleep well at night.”