Crispin Odey’s hedge fund enjoyed record gains last month, as his highly-leveraged bets against government bonds paid off.
The Odey European Inc. fund surged 38.4 per cent in February – the best monthly return in almost three decades of trading, according to an investor update seen by Bloomberg.
The performance lifted this year’s gains to 51 per cent – a rare bright spot for a fund that’s suffered losses in five of the past six years.
The news comes as Odey faces sexual assault allegations that date back more than 20 years.
Two weeks ago a London court heard that the hedge fund multimillionaire “lunged” at a junior woman in 1998 and groped her breast during the alleged assault. Odey denied the charge.
Odey stepped down from the helm of Odey Asset Management in November to focus on managing his own funds, the firm said.
At Odey AM, the hedge fund manager is reportedly now targeting long-dated government bonds amid expectations that a post-pandemic economic recovery will fan inflation, according to Bloomberg.
The fund’s short exposure to bond trades totalled almost 800 per cent of its net asset value at the end of January, mostly thanks to a single UK government security that matures in 2050, according to a separate investor letter.
“The extreme bubble in the valuation of the long end of bond markets, which is the direct result of central bank buying, presents investors with the chance to enjoy the next forty years, sitting on the right investments,” Odey wrote to clients last month.
Odey AM declined to comment.