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Nascent hedge fund manager Pirate Capital is considering selling covered calls in order to ramp up returns in its soon to be launched Jolly Roger Fund. Andrew Stotland, director of sales in Greenwich, Conn., said the fund will primarily take long positions in U.S. equities and fixed income products. Pirate will consider selling covered call options where it sees yield boosting opportunities.

A colored-in past... At the Strategic Resource Institute's conference last Monday, formerMerrill Lynch analystMartin Fridson proposed that the audience color in black the bull logo on the visuals for his presentation on the current economy's impact on the debt market. Fridson departed from Merrill last month.

The Deal Roll-off Chart, provided by Capital DATA Loanware, lists the 50 largest leveraged credit facilities in the U.S. market that are due to mature in the coming month. It is designed to provide a look at potentially available money in the market as credits are renewed or retired.

This chart, provided by Citibank/Salomon Smith Barney Inc., tracks bid-ask prices for par credit facilities that trade in the secondary market. It also tracks facility amounts, ratings, pricing and maturities.

* "I'm used to being the Rodney Dangerfield of the loan market-- it's tough getting respect with smaller deals."-- Durant Schwimmer, managing director of the syndications, trading and placement group at BNP Paribas Securities, heading off a panel about middle market deal reception in the present marketplace.

AXA Investment Management, which has £20 billion in fixed-income assets under management in its London office, is looking to buy credits that are fundamentally sound but have dropped in price on the back of market volatility. Denis Gould, head of the sterling investment-grade team, says, "at any hint of bad news, prices are dropping sharply. As investors, we have to make sure we can take advantage to be put in a position to buy."

The past year in the loan market has been marked by unprecedented volatility, sparked mainly by the Enron, Worldcom, Global Crossing and Adelphia blow-ups. The bumpy ride is settling a bit, but panelists in the "Shock Therapy" session said there is still a way to go before all is well in the corporate loan market. "Next year will be just as volatile in the leveraged market," said Ted Swimmer, managing director at Wachovia Securities. Unfortunately, no one disagreed.

American Express Financial Advisors is looking for an opportunity to take off its Treasury barbell and move to a neutral weighting in the three- to five-year part of the curve. Colin Lundgren, portfolio manager of $10 billion in taxable fixed-income, including a $4 billion core product, says the firm sold $40 million in 30-year Treasuries and bought some $150 million in off-the-run five-year maturities last Monday. It still has one more such trade to make to fully remove its barbell. "It's the next big move away. If we have another month of 50 basis point flattening between fives and 30s, we'd do it again." But, while Lundgren does believe the curve will continue to flatten as the market begins to anticipate an eventual interest rate hike, he does not expect this month to be as bullish as the last.

Asbestos-related names such as W.R. Grace, Federal-Mogul, and Owens Corning jumped after Sealed Air Corp. reached a settlement with asbestos claimants in connection with its packaging division, Cryovac. Traders said $10-15 million pieces of W.R. Grace changed hands in the mid-60s, up about 10 points. Federal Mogul traded at 64, up from the high 50s where it had been moving earlier this month, and Owens Corning traded in the 62-63 context. Amounts on those trades could not be determined.

David Petrosinelli, portfolio manager at Chicago-based Shay Assets Management, says the firm will reduce interest rate risk by allocating more to faster resetting securities in a move destined to reposition its $3.7 billion adjustable rate mortgage portfolio as it believes interest rates are about to rise. He reasons that in a rising interest rate environment, bonds that reset to a coupon in line with market rates perform better.

Last week, the Strategic Resource Institute held its sixth annual syndicated loans symposium at the Westin New York at Times Square. Topics included the increasing importance of the "B" investor, the state of the middle-market and increasing spreads on deals. Associate Reporter Judy McDermott filed the following stories.

Managing risk is the name of the game in the syndicated loan market these days and "B" loans have helped minimize losses and increase liquidity, according to Marsha Cruzan, managing director and head of syndications origination at Banc One Capital Markets. "The loan market does remain fundamentally healthy," she said in the conferences opening remarks. However, "Deals are clearly more difficult to syndicate than one or two years ago." Cruzan explained that "B" loans are on the rise with 29 so far this quarter with a spread averaging 479 basis points over LIBOR, 25 basis points higher than this quarter last year. She further noted that even utility lenders are getting attractive returns, with "collateral you can actually kick with your feet."