Vulture fund


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Vulture fund

A fund that buys distressed debt of commercial companies or sovereign nations at a cheap price and then often sues them for the entire value of the debt. The resemblance to vultures is because these funds profit from the debt of failing companies or poor nations.

Vulture Fund

A mutual fund that invests predominately or exclusively in high risk stock and high-yield debt. That is, a vulture fund invests in companies that are in or near bankruptcy. The idea behind a vulture fund is to buy securities at low prices and to earn an extraordinarily high return, even if it forces a company to do things against its best interest. For example, some vulture funds may force a company to repay debt when the company would be better served by declaring bankruptcy and not paying. As a result, the term is somewhat derogatory. See also: Vulture Capitalist.

vulture fund

A pool of investment money used to purchase distressed financial assets or real estate at bargain prices. Vulture funds are relatively risky but offer large potential profits. The performance of a vulture fund is dependent upon the skill of the fund's managers in identifying and purchasing undervalued assets that can be turned into profitable investments.

Vulture fund.

Like the scavenging bird of prey that lends its name to the fund, a vulture fund seeks out depressed or endangered investments.

Many vulture funds focus on real estate, but others invest in bonds that have been downgraded or are in default and other high-risk securities.

The strategy behind vulture investing is that such troubled securities have the potential to provide a large return eventually, in spite of their current vulnerable position. Most vulture funds are limited partnerships, but some are retail mutual funds that are open to individual investors.

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IF proof was wanted to show whose side Fine Gael is on you need look no further than the protest held outside a vulture fund's office on Wednesday.
The vulture fund's actions and the ruling have raised concerns about the erosion of sovereign immunity.
The success of vulture fund litigation depends largely on finding assets of defaulted nations that are outside the debtor's frontiers and subject to attachment.
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He said: "Despite the credit crunch and the reluctance of some banks to fund commercial property, REI has refinanced part of its debt-free property portfolio and released a further pounds 20 million which, together with existing cash and bank facilities, will provide it with pounds 100 million of firepower to capitalise on commercial property opportunities in the present market, effectively creating a specialist regional vulture fund."
Before the deal could be finalized, a vulture fund stepped in and bought the debt from Romania for less than 84 million.