Redwood Plans New Credit Fund for ‘Adversarial’ Debt Market
- Hedge fund wants to hold ‘larger positions’ in restructurings
- Predecessor fund returned 31.6% with bets on rates, inflation
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Redwood Capital Management, a $9.4 billion hedge fund focused on opportunistic investments in credit and special situations, is looking to raise another $2.25 billion for its next drawdown fund, according to a letter to investors seen by Bloomberg.
The firm’s last drawdown vehicle reported a net internal rate of return of 31.6% so far this year and 17.4% since its 2021 inception, tied to opportunities that arose mostly from Russia’s invasion of Ukraine in 2022, higher interest rates and inflation, according to documents shared with investors. Redwood has invested 50% of that fund’s capital.