The MFWire
Manage Email Alerts | Sponsorships | About MFWire | Who We Are

Subscribe to MFWire.com's News Alerts [click]

Rating:Is This the End For Third Avenue and Its Triple-C Cowboys? Not Rated 0.0 Email Routing List Email & Route  Print Print
Tuesday, December 22, 2015

Is This the End For Third Avenue and Its Triple-C Cowboys?

News summary by MFWire's editors

It's been a week and a half since the folks at Third Avenue [profile] shocked the investing world by barring redemptions from their formerly high-flying Focused Credit Fund. Barron's wonders whether the AMG-backed value shop can survive the fallout.

Sean Healey
Chairman, Chief Executive Officer
Meanwhile, the WSJ offers three more takes on the Focused Credit Fund "fiasco." The chief of a $13-billion hedge fund shop is calling the Third Avenue folks "triple-C cowboys." An RIA writing in InvestmentNews called out Third Avenue for having "absolutely no plan for a mass exodus." The head of the J.P. Morgan high-yield bond desk, Wall Street's biggest, reassures the WSJ that "you can still make good money in high yield," and Morningstar notes that, while high yield bonds are down 4.8 percent year-to-date, the median high-yield bond fund is only down about 3.8 percent. Morningstar's Christine Benz and Russ Kinnel and MarketWatch's Chuck Jaffe try to help investors learn some lessons from the Third Avenue Focused Credit Fund's demise. Reuters points out that Third Avenue built up a $200-million cash reserve in the fund and still couldn't save it. Morningstar downgrades its parent rating of Third Avenue, calling out the Focused Credit Fund's fall as reflecting "a profound management and governance failure." And Bloomberg notes that similarly-branded high-yield bond fund PMed by an ex-PM of the fallen Third Avenue fund moved 45 percent of its AUM into cash after big redemptions in the wake of the Third Avenue Focused Credit Fund fallout.

On Saturday Amy Feldman of Barron's pondered "how the mighty have fallen." She writes that, looking back on a May Barron's piece on Third Avenue, the publication was "too optimistic with regard to the firm's outlook." AMG owns 60 percent of Third Avenue, and AMG CEO Sean Healey says he is "confident in the firm's future path." Yet Barron's, citing KBW analyst Robert Lee, worries that if redemptions pile up for Third Avenue's remaining four mutual funds, "AMG might change course and sever the relationship."

And therein lies the rub. "The big unknown," Barron's writes, "is the extent to which the credit fund's failure will cast a shadow on its remaining funds." The publication concludes that "at worst," Third Avenue "might not survive." 

Edited by: Neil Anderson, Managing Editor

Stay ahead of the news ... Sign up for our email alerts now

 Do You Recommend This Story?

Return to Top
 News Archives
2022: Q4Q3Q2Q1
2021: Q4Q3Q2Q1
2020: Q4Q3Q2Q1
2019: Q4Q3Q2Q1
2018: Q4Q3Q2Q1
2017: Q4Q3Q2Q1
2016: Q4Q3Q2Q1
2015: Q4Q3Q2Q1
2014: Q4Q3Q2Q1
2013: Q4Q3Q2Q1
2012: Q4Q3Q2Q1
2011: Q4Q3Q2Q1
2010: Q4Q3Q2Q1
2009: Q4Q3Q2Q1
2008: Q4Q3Q2Q1
2007: Q4Q3Q2Q1
2006: Q4Q3Q2Q1
2005: Q4Q3Q2Q1
2004: Q4Q3Q2Q1
2003: Q4Q3Q2Q1
2002: Q4Q3Q2Q1
 Subscribe via RSS:
Add to My Yahoo!
follow us in feedly

©All rights reserved to InvestmentWires, Inc. 1997-2022
14 Wall Street | 20th Floor | New York, NY 10005 | P: 212-331-8968 | F: 212-331-8998
Privacy Policy :: Terms of Use