High-Yield Fund Blocks Investor Withdrawals


A large mutual fund specializing in risky, high-yielding bonds has blocked investors from getting their money back, citing difficult trading conditions for its securities.

The move, announced Thursday by Third Avenue Management funds, was a troubling sign of the recent deterioration in junk bonds, a category that has been hurt in particular by the debt of energy companies struggling with the slump in oil and gas prices. Energy debt accounts for roughly a sixth of the market.

More important, the action by Third Avenue highlights a longstanding fear among regulators and economists that too many investors have piled into risky areas of the bond market, like leveraged loans and emerging-market debt, as well as junk bonds…

High-Yield Fund Blocks Investor Withdrawals

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