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[Article] Easterly fund fire sale a one-off, market participants say

June 24 Bond Buyer article quotes Triet Nguyen on the recent Easterly high-yield fund selloff.

easterly fund fire sale

In the June 24 Bond Buyer article “Easterly fund fire sale a one-off, market participants say,” Caitlin Devitt and Jessica Lerner report on the recent selloff by the Easterly RocMuni High Income Municipal Bond Fund and the broader implications for the high-yield muni market.

Triet Nguyen, DPC’s vice president and a veteran in high-yield munis, noted the situation is likely isolated and could present opportunities for other funds.

“This could probably turn out to be an opportunity for a lot of the other funds,” said Triet Nguyen, vice president of strategic data operations at DPC Data and high-yield muni market veteran, of the recent Easterly high-yield fund selloff.

The fund’s net asset value plunged from $6.36 to $3.09 in June, with assets dropping from $232 million to just $25.1 million. Despite this sharp decline, Easterly says it was repositioning for liquidity rather than liquidating.

Market participants attributed the severity of the decline to the fund’s heavy concentration in illiquid 144A private placements and distressed project finance deals with limited transparency. While some fear a ripple effect, most agree it’s not yet systemic, though caution remains.

Analysts emphasized the importance of credit discipline, noting that the high-yield market’s structure makes it vulnerable to pricing gaps during stress. Still, many see the fire sale as a market aberration rather than a harbinger of broader trouble.

Read the Bond Buyer article.

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