The $1.4 billion Bear Stearns High-Grade Structured Credit Strategies fund is reopening to new investors, due to what fund management expects will be increased investment opportunities in structured credit markets. In a recent letter to investors, the fund's manager said these opportunities would present themselves "both in the higher-rated tranches as well as in the below investment grade classes." The plan is to raise at least an additional $250 million through the first quarter, the letter adds. "One can't wait for the opportunity to present itself; one has to anticipate and be prepared to act...therefore we are reopening the fund to new subscriptions." Calls to Bear Stearns were not returned by press time.
Ninety percent of the fund's portfolio consists of structured finance securities rated at least AAA and AA-. The remaining 10% of the portfolio is currently used to purchase securities that will themselves be restructured into investment-grade assets or have an investment-grade return profile, states the letter. The fund is levered up to 10:1. It returned 1.10% in October and is up 8.28% year-to-date. In 25 months, it has not yet experienced a losing month.