Bear Stearns hedge funds tapped out

Investors in Bear Stearns’ two failed hedge funds have lost their money and will probably not get it back, according to published reports. The Wall Street firm said that its High-Grade Structured Credit Strategies Enhanced Leverage Fund had no value, and the High-Grade Structured Credit Strategies Fund has lost more than 90% of its value, a source told Bloomberg. Yesterday, Bear Stearns sent a letter to its clients, briefing them on the status of the funds. In its letter, Bear Stearns also told investors that it will “seek an orderly wind-down of the funds over time” due to the funds’ significant losses last month, Reuters reported. Last month, Bear Stearns gave its High-Grade Structured Credit Strategies $1.6 billion in emergency financing. Bear Stearns Asset Management has restructured its risk management so that managers will report to Mike Alex, chief risk officer, the New York Times said.