New York, NY (Law Firm Newswire) January 19, 2016 - Zamansky LLC announces that it is investigating various high yield bond funds listed below for potential securities law suitability violations.
Since 2009, many investors, particularly retirees or those seeking income, have invested in high yield bond and income mutual funds on the advice of their broker or financial advisor. These high yield funds were sold as secure, high quality income-generating investments that had modest risk.
In truth, high yield bond and income mutual funds can be high risk and speculative due to their concentration in unrated or below investment grade-rated debt or junk bonds, as well as their holdings of illiquid and private securities, according to investment fraud lawyer Jake Zamansky. These high yield funds are extremely risky for ordinary retail investors who are usually unaware of the risks he states, and it is a violation of FINRA Rules to sell an unsuitable investment. Zamansky believes that any investor with a loss from a high yield bond or income fund should have their situation reviewed for whether the investment was suitable for them or whether the risks of the fund were properly disclosed.
Most high yield bond funds are down 20% or more, Zamansky states, and investors were shocked when the Third Avenue Focused Credit Fund announced that it was closing in December 2015 due to illiquidity. Zamansky believes that other high yield funds will close or suffer large losses during 2016 while the crisis in the bond markets continues.
Zamansky also cautions that these risky high yield funds may be held by investors through 401(k) plans, retirement plans, variable annuities, life insurance policies or other retirement savings plans. Investors should review their plans for these funds to ensure that they know and understand their risk, he says.
List of High Yield Bond Funds:
American High Income Trust (AHITX)
Waddell & Reed Ivy High Yield Fund (WHAIX)
T. Rowe Price High Yield (PAHIX)
Fidelity High Income Fund (SPHIX)
Federated High Income (FHIIX)
PIMCO High Yield (PHDAX)
MFS High Income Fund (MHITX)
Pioneer High Yield (TAHYX)
Vanguard High Yield Corporate (VWEHX)
Western Asset Short Duration High Income (SHIAX)
Toews High Yield (THHYX)
Babson Capital Global Short Duration High Yield (BGH)
Avenue Credit Strategies Fund (ACSBX.O)
Stone Lion Capital Partners – hedge fund
Lucidus Capital Partners – hedge fund
What High Yield Bond Fund Investors Can Do
If you are an investor in a high yield bond mutual fund or hedge fund and wish to have your investment reviewed or to discuss your legal rights, you may, without obligation or cost to you, email [email protected] or call the law firm at (212) 742-1414.
About Zamansky LLC
Zamansky LLC is a leading investment fraud law firm specializing in securities, hedge fund and ERISA class action litigation, and FINRA securities arbitration. We are investment fraud attorneys who represent both individual and institutional investors. Our practice is nationally recognized for our ability to aggressively prosecute cases and recover investment losses.
To learn more about Zamansky LLC, please visit our website, http://www.zamansky.com.
50 Broadway - 32nd Floor
New York, NY 10004
Jake Zamansky, 212-742-1414