Credit Carnage in USA

Here's an actively managed credit fund, Third Avenue Focused Credit (TFCVX). "An opportunistic, bottom-up investment strategy that selects high yield stressed and distressed credits up and down the capital structure." It has been a good performer in the past and is well managed, but it is subject to the whims of the credit markets. It has been serving well as a leading indicator for high yield credit and it is pointing south again. Trouble is brewing.


  1. Deep puts on HYG and JNK are pretty cheap, but the market is filled with HFT spoofers and its very illiquid - gotta screw around for awhile before you can make a transaction.

    - Luke

    1. Tim Knight over at Slope of Hope has a short on JNK. If I'm not mistaken, it's he's most confident in that position and has been holding it at least since summer. He's a pure chartist.