Nomura's Hodges adds Italian debt on expectations of Brexit-like post-referendum rally

Amid widely-held short positions in Italian debt

Nomura Asset Management's head of unconstrained fixed income Dickie Hodges has bought Italian debt for the first time this year, as he anticipates a post-referendum rally similar to the market reaction in the UK after the Brexit vote.

Hodges (pictured), who runs the $84m Global Dynamic Bond fund, bought 10-year and 7-year Italian bonds and 10-year Italian bond futures last week and added to his Italian position again this week. He said over the past few months he has observed a significant movement in the market, with investors shorting Italian debt versus Spain, France and Germany. "It is a bit like Brexit and the lead-up to that," he said. "Everyone was short UK equities, UK government bonds and UK banks but after the vote, even though it was negative and we voted to leave, we saw a massive rally in these asse...