The CEO of the risky junk bond mutual fund that blew up last week has stepped down.
The Third Avenue Focused Credit Fund focused on the riskiest corners of the junk bond market, investing in distressed debt of companies that were close to defaulting on their loans and ones that already had. Last week the fund announced it is liquidating and blocked investors from getting their money back.
Its implosion is a very rare event in the normally-sleepy mutual fund industry and highlights the turmoil rippling through the riskiest parts of the bond market.
The event also raises questions about whether Third Avenue's focus on extremely risky and difficult to trade assets was really appropriate given the fact that mutual funds promise investors the ability