Lasry's Credit Mutual Fund Sees $206 Million Outflows This Month

  • High-yield fund at $821 million, down from $2 billion
  • Lasry says his fund's holding in illiquid assets minimal

Marc Lasry’s Avenue Capital Management has seen withdrawals of $206 million in its high-yield mutual fund this month as investors flee the troubled sector.

The outflows from the Avenue Credit Strategies Fund, along with its loss of 5 percent so far this month, has brought assets under management to $821 million as of Dec. 14, according to Morningstar Inc. That’s down from $2 billion in November 2014.

Like other managers who invest in high-yield and distressed securities, Lasry is distancing his product from Third Avenue Management’s $788.5 million credit fund, which closed and froze redemptions last week after it had loaded up on hard-to-sell assets. The Avenue Credit Strategies Fund is managed by Jeff Gary, who helped start Third Avenue’s credit fund before joining Lasry’s firm in 2012.

“We have a well-positioned portfolio and our illiquid assets are in the single digits,” Lasry said in an interview.

Lasry’s mutual fund has tumbled 11 percent this year, with dividends reinvested, trailing almost all of its peers, according to data compiled by Bloomberg.

Avenue Capital manages $12.7 billion in distressed securities, mostly in funds with multi-year lock-ups and the ability to wager on falling as well as rising prices.

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