BlueMountain launches new closed-end credit correlation fund

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BlueMountain Capital Management, Andrew Feldstein’s $4.5 billion hedge fund firm, began trading a new closed-end hedge fund on October 1 designed to profit from opportunities in the structured corporate credit markets.

The new vehicle, called Correlation Relative Value II Fund, has $80 million in assets and is managed by Bryce Markus, a managing principal.

CRV II is BlueMountain’s third long-term closed-end fund dedicated to credit correlation trading. Timberline Fund, launched in March 2006, has netted 44% year to date through September 30. BlueMountain’s Credit Relative Value I Fund, which wound down in February 2007, returned an annualized net gain of