Capital Structure

The Federated Leveraged Company Stock Strategy will invest in about 50 stocks, many of which Neavin said he and co-portfolio manager Mark Durbiano already own in the junk-bond mutual fund. The High Yield Trust currently allocates 12.9 percent to stocks, the second most among peers tracked by Bloomberg, including investments in the public equity of Time Inc. and Radio One Inc., according to data compiled by Bloomberg.

The company will begin marketing the strategy to institutional investors later this month as an alternative to private equity and as a complement to existing equity allocations. At $3 trillion, the combined market capitalization of the 600 publicly traded stocks whose credit is speculative-grade is bigger in value than the leveraged-loan and high-yield bond market combined, he said.

“It’s not the cleanest story for a fixed-income group managing equities, but I would say we’re really capital- structure investors,” Neavin said.

First « 1 2 » Next