CNBC – The steep decline in oil prices is seen as an opportunity by many hedge funds. But picking out the bonds of distressed oil companies can also be a dangerous game.
Take Kamunting Street Capital Management, which is essentially going out of business following losses on high-yield or “junk” energy company bonds. The fund lost about 4 percent last year and was down an additional 2 percent this year, according to The Wall Street Journal. The exact percentage of losses related to the decline in oil and gas prices was unclear.