(Financial News) A London hedge fund that sought to reshape the image of what it takes to manage money in the $3tn industry from the spare room of a Wimbledon townhouse, is closing after five years.
Former commodities traders Irene Perdomo and Leonardo Marroni launched Devet Capital with $29m in mid-2014 and saw assets rise to more than $100m four years later.
Both have now joined Gresham Investment Management as managing directors in GreshamQuant, the $6bn asset manager’s systematic research division, according to Marroni.
Perdomo, a former winner of the Elite Model Look modelling contest who later worked as a commodities trader at Noble Group, and Marroni, previously of GLG Partners, ran Devet from Perdomo’s home in south London.
The firm drew attention for ultra-low operating costs that led to it being dubbed the “world’s cheapest hedge fund”.
The Wall Street Journal reported in 2018 that Devet’s annual operating budget was around £66,000. Marroni told WSJ at the time that “Americans love the idea you start from a bedroom, rather than a serviced office”.
Perdomo explained in the same article that the pair, who met while working at Barclays, were out to disprove many of the “myths” around what it took to run a hedge fund. She said: “So many activities are overrated. It’s bullsh*t that traders have to trade and they can’t do anything else…Another of the myths when you start is that you need a Bloomberg (terminal). Really?”
Devet's flagship Absolute Return Strategy made bets in the market for commodities futures, with Perdomo and Marroni having co-authored a book in 2013 entitled Pricing and Hedging Financial Derivatives: A Guide for Practitioners. The fund delivered 19% in 2015, outperforming the wider industry, WSJ reported.
Speaking to Hedgeweek in June 2017, Perdomo said: “We attribute our rapid asset growth to [commodity trading adviser] investors who are constantly looking for niche products that are non-correlated to the market.”
But a person familiar with the matter said the firm had lost money since 2017. Devet closed in October, shortly before Perdomo and Marroni delivered a lecture at Imperial College London entitled “The Dos and Don’ts of Hedge Fund Management”.
Gresham Investment Management said in a statement: “As authors, university lecturers, and systematic investment practitioners, Irene and Leonardo add both breadth and depth to Gresham’s strong and growing quantitative research capabilities.”
The pair will report to Scott Kerson, group head of GreshamQuant.
