Odey European‘s Crispin Odey is having a bad year. His London-based hedge fund has lost 22% YTD after falling 8.3% in September reports BusinessInsider. The numbers come from a letter Odey sent to investors.
Crispin Odey is Not Alone – September was a Hard Month for Hedge Funds
Crispin Odey isn’t alone. September was a tough month for hedge fund managers across the board (check out hedge fund returns in September). The average hedge fund lost 3.7%, down nearly 10% from the month before. The average hedge fund return as of the end of September is 5.2%. Even big names like Omega Advisors‘ Leon Cooperman, Maverick Capital‘s Lee Ainslie and Pershing Square‘s Bill Ackman lost several percentage points, putting each man’s fund into double digit negative returns for the year, so Odey is in good company anyway.
Crispin Odey Loses on a Long Portfolio
Crispin Odey’s losses appear to stem from a long portfolio. BusinessInsider reports, “The worst detractor to performance was its position in Sky Deutschland, which lost 1.24% in the month. Combined with negative performance from other sectors such as banks (-0.90%), autos and parts (-0.79%) and food producers (-0.69%), this outweighed gains in holdings such as British Sky Broadcasting (0.34%), APR Energy (0.11%) and Samusng Electronics (0.10%). The letter said that the short book posted a return of 0.7% with index hedges providing the biggest contribution.” That’s not to say a long position is always a bad thing. Some fund managers, like Trident’s Nandu Narayanan, take long positions that are very profitable, even in down markets, but that is because, at least in Narayanan’s case, defensive positions and commodities were the focus.