Distressed Debt Investing

Investing in Distressed Debt Distressed securities may be an attractive investment option for sophisticated investors who are looking for a bargain and are willing to accept some risk. Distressed debt investing combines the best of both worlds — the cash flow of debt investments with the appreciation potential of stocks. While there is no hard and fast rule for what makes a “distressed” investment, it’s generally accepted that distressed debt trades at a huge discount to par value  because the borrower is under financial stress and at risk of default. Distressed securities are debt securities; most often corporate bonds, from companies that are experiencing a high degree of financial pressure. When a company’s ability to meet its financial obligations is challenged, its debt securities might be substantially reduced in value. Read More …

Disclaimer

Information on this website is provided for informational purposes only and is not offered as advice with respect to any particular security or related financial instrument. This information should not be used as a basis for making an investment decision and must not be treated as a substitute for seeking advice from a licensed professional. The suitability of a given investment for a particular investor depends on a number of factors, each of which should be considered carefully. Such factors include, but are not limited to, the risk associated with the investment, the nature of current market conditions, and the investor’s objectives, personal needs, and specific circumstances. This is neither a solicitation to buy nor an offer to sell to persons in Texas. The Distressed Debt 1 Hedge Fund is Read More …

Distressed Debt 1, LP and Its Philosophy

A Global Distressed Debt Hedge Fund Distressed Debt 1 LP Distressed Debt 1, LP is a Delaware limited partnership that searches the global bond markets looking to buy deeply discounted or defaulted debt for pennies on the dollar, from issuers that appear likely to restructure or settle the debt and still return significantly higher returns than are normally associated with high yield junk bonds. Many of these companies may be in a technical or selective default, and some of them will continue to pay interest income at very high rates while seeking better terms with existing debt and bond holders. Consequently, we seek to achieve a cash flow average above 15% while waiting for companies to improve balance sheets and negotiate more favorable terms with creditors. Distressed Debt 1’s unique Read More …