Freddie Neave has removed the leveraged bond bets put on by his former boss Crispin Odey at the flagship hedge fund he now runs for Odey Asset Management as he cuts risk ahead of moving out of the investment firm.
(Bloomberg) — Freddie Neave has removed the leveraged bond bets put on by his former boss Crispin Odey at the flagship hedge fund he now runs for Odey Asset Management as he cuts risk ahead of moving out of the investment firm.
Government bond exposure in the Odey European Inc. fund has been taken to zero, while equity exposure has been cut down to single digits, according to a letter seen by Bloomberg that the London-based money manager sent to investors.
A representative for Odey Asset Management declined to comment.
Leveraged short wagers on long-dated government bonds once totaled 800% of the net asset value of the hedge fund under Odey, who was sacked in June from his own investment firm after publication of a report about his treatment of women over several decades. The report included multiple allegations of sexual harassment and assault, which Odey denies.
Gross equity exposure was reduced to 8.6% as of Aug. 8, down from 140% on Jun. 7, the letter showed.
“We have continued to reduce exposure in the fund,” Neave wrote in the letter. “We are hedging all equity exposure back to base currency and have no direct commodity exposure. This can give investors comfort that the exposures they face over the coming weeks are materially lower than in the ordinary course of business.”
The firm is in advanced talks to move Neave to Landseer Asset Management UK, according to a statement dated Aug. 11. Under the proposal, Landseer will become the investment manager of a new fund carved out from the restructuring of Odey European Inc. and OEI Mac Inc., both currently managed by Neave.
The move marks a final re-jig at the hedge fund once known for its bold and contrarian bets put on by Crispin Odey. Such wagers led to extreme performance highs and lows for his clients. The fund soared 152% last year, powered mainly by his short wagers on long-dated UK government bonds as inflation and political turmoil roiled the British economy.
The fund lost 2.3% in July, extending its decline so far this year to 15.6%, according to the letter.
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