Credit markets look like a"slow motion car crash," according to hedge fund billionaire Brian Higgins.
Higgins is the co-founder of King Street Capital, which made billions in the wake of the 2008 debt crisis. The firm is now looking to raise a $3 billion fund targeting opportunities in credit markets, a source toldHiggins, meanwhile, told Bloomberg that he saw new opportunities in debt markets as tighter credit conditions pressure many firms.
"This market is a slow-motion car crash," Higgins said, describing opportunities in the market as a"walk, don't run" situation. The firm is especially looking to increase exposure to commercial real estate, a source told Bloomberg, especially as the sector seesamid tighter lending standards, lower property valuations, and higher interest rates.
The firm's flagship portfolio posted a gain of 4.5% through May, and lost just 3.8% in 2022 as markets broadly swooned, a source said. It has outpaced other hedge funds in the market, with Bloomberg's credit hedge fund index gaining just 2.2% this year and losing 5% in 2022.