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Crispin Odey, the salmon that is not afraid of volatility | Opinion

They consider him the new George Soros, because he is making a fortune against the pound. Although in this case it is the currency of his own country: the British Robin Crispin William Odey (Yorkshire, England, 1959), known as Crispin Odey, is a manager of hedge funds, and founder of Odey Asset Management.

Its reference fund has achieved a 145% return this year betting against British public debt. Odey AM manages 4,000 million pounds (4,570 million euros) in assets. He believes that rising inflation is here to stay and that central banks will have to raise rates faster. He also does not rule out the possibility of reaching parity for the pound against the dollar, something that has never happened before.

He is the only child of (George) Richard Odey, a member of a family of industrialists; his mother belonged to the prominent Clitherow clan of politicians and merchants. He was educated at Harrow School, where his father had been a student delegate, and took a BA in History and Economics from Christ Church, Oxford.

Shortly thereafter he discovered that his father had incurred huge debts. The manor house was handed over to him by “runaway administrators”. So he sold Hotham Hall, a 4,000-acre (1,600-hectare) estate that had been in his mother’s family since 1720. The money went to support his parents. “I was 23 years old, but I learned a lot,” he said in the Evening Standard. His father, he says, “was always short of money, so you spent your life giving alms. He was a spendthrift from start to finish.”

He also rebelled against his grandfather, “a formidable bully” who was a Conservative deputy, and who insisted that he study law. He graduated as a lawyer, but joined the Framlington fund manager, and Barings International. In both he directed pension funds in continental Europe. “My grandfather didn’t like the City and he wasn’t used to being contradicted, so he got angry. He left me in his will nothing but an empty suitcase.”

Around this time he met his first wife, Prudence, daughter of Rupert Murdoch. “Little black dresses, black skirts and dark hair: black was the ultimate color. She was an impoverished semi-student who had just gotten a job and she didn’t really know if she was going to get anywhere. She lived in a shared flat. I was a little surprised that she was interested [en mi]. I was flattered. He told me: “My father is trying to get me back to Australia and I need an excuse not to go back. Why don’t we get married?

“They say that great weddings [500 invitados] they make terrible marriages, and it’s true. Of course we weren’t right, but Rupert really wasn’t one to be told no to. But it was an amicable parting [a los 15 meses]”. His fund owns almost 1% of the Sky television network, which is majority owned by Fox.

Shortly thereafter he met Nichola Pease, a member of one of the founding families of Barclays, and now a non-executive director of asset manager Schroders. She “she came from a much happier family, so she had a tremendous amount of natural self-confidence and practicality.” They got married and have three children, two boys and one girl.

It was his wife who suggested that he create Odey Asset Management, back in 1991, the year of the wedding. George Soros, precisely, was one of the original investors. Odey suffered big losses in 1994 when the Fed unexpectedly raised rates, but he continued to prosper, for example by anticipating that insurance companies would rise in value after the 9/11 attacks in 2001. His big break came with the 2008 financial crisis, thanks to his bearish bet on the banks. He too had been constantly warning about the dangers of debt and inflated home prices.

Policy

He was accused of financially supporting the anti-EU in the Irish referendum on the Lisbon Treaty, which passed with 67.1% in favour. Odey denied having financed the no. In 2016, he was a vocal proponent of Brexit, arguing that it would allow the UK to govern itself. That same year, his hedge fund earned about 15% of its fair value after the referendum, thanks to falling markets.

He is a donor to the Conservative Party, but is also highly critical of leaders such as David Cameron. He supported Michael Gove, who ran for prime minister but lost to Theresa May. He then was with Boris Johnson, whom he recommended to carry out a Brexit without an agreement with the EU. He has made strong returns by buying shares in oil and coal miners, whose prices had fallen sharply as they were excluded from funds conscious of environmental sustainability.

His fund is highly volatile, regularly posting double-digit annual gains or losses. These last few years hadn’t been good, but he stuck to his guns. “Certainly, it would be easier to follow the market. But then we would be ignoring the fundamental data.” He defended that there would be a crash derived from the rises in interest rates, a moment that seems to have arrived. That yes, after the crisis of 2008 he supported that the types go down to zero, so that the credit would grow.

In February 2019, with less than two months to go before Brexit, Odey again bet against the pound. “If you want to be a rich man, you have to think like a rich man. You have to be patient. You must be imaginative, and have the thick skin to make decisions against the markets, to believe that you are right and they are wrong.

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