Odey Asset Management has faced a challenging year. On Tuesday the London hedge fund firm announced a slew of changes seemingly aimed at addressing that.
Founder Crispin Odey said in a statement that he will now focus solely on managing the firm’s hedge funds. That includes its flagship Odey European fund, which is down 21.3 percent this year through September, according to person familiar with the performance.
Timothy Pearey, Odey’s co-chief executive, will take over day-to-day company management. The news was first reported in Investment Week.
At the same time, Odey Asset Management will launch a new fund, managed by the founder, that will focus on “combating the threat to capital preservation presented by the prospect of much higher levels of inflation,” according to the statement. The firm also plans to create a new entity called Brook Asset Management, which will at first manage several existing funds, which will be renamed.
This year has been tumultuous for Odey on both personal and professional fronts. In September he was charged with indecent assault over an alleged incident that took place in 1998. Odey pleaded not guilty and is set to stand trial in February.
The firm, founded in 1991, has produced volatile returns over the years. Odey’s flagship hedge fund has posted double-digit losses in four out of the past five years, including a 49 percent loss in 2016, owing to the manager’s long-time bearish positioning. But other years have been as good as 2016 was bad. Odey landed at No. 7 on Institutional Investor’s 2019 Rich List, earning $530 million on the back of a 53 percent gain in 2018 — a year when the equity markets declined.
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“I have always had a dedicated, professional team to manage the business, and this feels the appropriate time to relinquish sharing that responsibility in favor of focusing on investment and nurturing investment talent,” Odey said in Tuesday’s statement. “I have always believed that investment talent should be organized like barristers’ chambers, where different principals can work together fruitfully, sharing ideas and resources, whilst operating independently. Adrian Courtenay is a great example of such talent.”
Odey was referring to the manager of Odey Asset Management’s Special Situations fund, which gained 48.7 percent in its first year through mid-October, according to the statement.
At the same time, Odey, one of the most high-profile hedge fund managers in the U.K., has remained a fixture of the British tabloids, owing in part to his personal fortune and his political leanings. The UK’s Evening Standard estimates that Odey and his fund manager wife have amassed £846 million ($1.1 billion).
He’s also heavily involved in U.K. politics, having donated £1.7 million to the Tory party over the past decade, according to the paper. Odey was an outspoken supporter of Brexit and the campaign of Prime Minister Boris Johnson.