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Bailey McCann, Opalesque New York:

Following a frustrating 12- to 18-month period for a vast majority of hedge fund strategies, Neuberger Berman is out with new research which posits that event-driven and distressed credit hedge funds may start to rally over the second half of the year.

Founded in 1939, $250 billion Neuberger Berman is an independent, employee-owned investment manager. The firm manages equities, fixed income, private equity and hedge fund portfolios for global institutions, advisors, and individuals. The firm provides regular research pieces on the state of alternative investments from its perch as an investor.

In the latest report, researchers suggest that the market is in the early stages of a new, relatively narrow distressed cycle that could be a boon for some credit shops. "Whether or not a meaningful uptick in actual corporate bankruptcy filings will materialize, it is undeniable that, from a pricing standpoint, the next distressed cycle has already commenced," report authors write. Neuberger suggests that the opportunity set for distressed credit will be available over the near to medium-term time horizon and could last longer if the distress results in an uptick in bankruptcies in sectors that look relatively stable right now.

"It's clear to us that there are definitely sector opportunities in energy, shipping, and retail," explains report author Jeff Majit, co-head of Neuberger Berman's alternative investment management grou......................

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