Reuters - Mutual fund manager Franklin Templeton has hired a former hedge fund manager to expand its Asian line-up of products investing in lucrative alternative assets, joining its peers in tapping a rapidly growing market.

Scott Collison, who in 2011 launched one of the biggest hedge funds in Asia, has joined Franklin Templeton in Singapore as its first head of alternative sales for Asia, home to some of the world's fastest growing economies and large institutional investors.

Franklin Templeton manages some $880 billion worth of assets globally.

"It's the convergence of traditional and alternatives managers that I think is the key thing going forward," Collison told Reuters in a telephone interview.

"Many years from now, when people will look back, they will see this period as an inflection point," said Collison, who shut his hedge fund, Orvent Asset Management, in 2012.

Alternatives include hedge funds, real estate and private equity, and these products earn asset managers far higher fees than the traditional mutual funds and exchange-traded funds. For money managers, alternative assets also diversify income streams.

After a brief slowdown during the 2008 financial crisis, alternative assets have continued to gain popularity with investors, with large asset managers the biggest beneficiary of inflows.

Hedge funds, for example, have seen their assets grow by a trillion dollar to over $2.5 trillion since 2009, according to data from industry tracker HFR. A survey by Barclays, released on Monday, said the industry could raise a net $80 billion in 2014, a nearly 25 percent increase over 2013.

The survey also showed that 66 percent of the inflows through September in 2013 went to firms managing $5 billion or more, while 13 percent went to those with less than $1 billion.

Globally, asset managers have been scrambling to expand their alternative investment products.

U.S. asset manager Principal Global picked a majority stake in hedge fund investor Liongate Capital last year, while Legg Mason bought Fauchier Partners, one of London's oldest fund-of-hedge-funds firms, in 2012.

Franklin Resources also bought a stake in fund-of-hedge-funds K2 Advisors in 2012, boosting its global offerings that include alternative products from private equity to commodities.