More sub-prime fallout

United Capital Markets, a leading broker in the asset-backed securities market said on Tuesday that it had suspended investor redemptions on four of its Horizon hedge funds after suffering losses. The company added that the suspension was temporary and it does not plan to liquidate any of the funds.

United has conducted a fire sale selling "a large amount" securities in the market reduced their leverage and also has stopped trading in the synthetic structured finance markets completely because they are "highly volatile."

The company said trading losses and market re-pricing will leave the funds down in June and for the year. I'm sure the following comment was also of comfort to investors:

"The majority of our selling was completed in June and we emphasize that we are not currently in a liquidation mode," the firm added. "We have spoken to our lenders and they are supporting our efforts."

Not currently, so we may be next week but not this week, that's good to know. Read the full article here