Centerbridge Credit Fund To Return US$500 Million

Oct 1 2012 | 6:46am ET

Quantitative easing has been a boon to Centerbridge Partners' credit hedge fund. But it's also proving a damper on opportunities for the US$8.3 billion hedge fund.

Centerbridge on Friday told investors in its Credit Partners fund that it would return US$500 million. The firm said that it has as much as US$2 billion of the fund's assets simply sitting in cash due to the paucity of enticing options.

"Absolute yields are in our view strikingly low," Centerbridge wrote in the notice to investors, which was obtained by the Financial Times. "The market currently feels frothy. Should the markets continue on this upward trajectory, the fund will continue to raise cash and distribute it."

Centerbridge launched the Credit fund in 2007; it has returned some 65% since then, without using leverage and has made something of a habit of periodically returning capital to clients. It told investors it continues to actively seek out opportunities, especially in Europe, but that its earlier investments are simply producing too much cash to reinvest.

"While we have been selectively adding to new positions in the U.S. and particularly in Europe, we continue to generate substantial amounts of cash," the firm wrote. "Consequently, we have decided to return a portion to investors."

Centerbridge manages about US$20 billion.


In Depth

David Yarrow On Growing His Hedge Fund And Shooting The Animals And People Of Africa - As A Photographer

Jul 23 2014 | 6:44am ET

While he’s always been a photographer, recent expeditions to Iceland, Ethiopia...

Lifestyle

Einhorns Busts At WSOP, Finishes In 173rd

Jul 15 2014 | 10:48am ET

Greenlight Capital founder David Einhorn’s World Series of Poker won’t end at...

Guest Contributor

Common Risk Parity Misperceptions

Jul 16 2014 | 11:02am ET

Over the past few years, risk parity has become a component of most investors’...

 

Sponsored Content

    Northern Trust Helps Hedge Funds Navigate Derivatives Regulations

    Jul 8 2014 | 10:48am ET

    The surge in derivatives regulation is among the most complex challenges facing the financial services industry today. Northern Trust’s Joshua Satten recently spoke with FINalternatives to share insights into the challenges presented by new regulation and explore how the industry is responding. Read more…

Publisher's Note