NEW YORK (Reuters) – The desperate hunt for yield will continue in 2013, with investor money continuing to flow into high yield “junk” bonds, corporate debt and mortgage securities as it has this year, albeit with lowered expectations on returns.

According to a dozen money managers at the Reuters Global Investment Outlook 2013 Summit, the Federal Reserve’s commitment to hold rates near zero until at least mid-2015 provides ample buying support for corporate credits.

NEW YORK (Reuters) – Investors, policy makers, and analysts spoke at the Reuters Global Investment Outlook 2013 Summit in New York, London, and Hong Kong. Below are some memorable quotes from New York discussions:

BONNIE BAHA, SENIOR PORTFOLIO MANAGER AT DOUBLELINE CAPITAL: “The term (fiscal cliff) is going to become a new drinking game…My fear is that the can gets kicked down the road for at least a 6-month period.”

NEW YORK (Reuters) – The U.S. government is threatening to file civil securities fraud charges against SAC Capital Advisors and is tightening the regulatory screws around Steven A. Cohen, the $14 billion hedge fund’s founder and one of the industry’s most famous traders.

The move comes a week after a former SAC Capital employee was charged with running the most lucrative insider trading scheme ever in a series of transactions Cohen signed off on.

NEW YORK, Nov 28 (Reuters) – The U.S. government has told
hedge fund titan Steven A. Cohen’s SAC Capital Advisors that it
is likely to face civil charges over alleged insider trading at
the $14 billion firm, a source familiar with the matter said on
Wednesday.

SAC told investors on a Wednesday conference call that the
Securities and Exchange Commission had issued a so-called Wells
notice to the firm, according to the source, who listened to the
call.

NEW YORK (Reuters) – The U.S. government has told hedge fund titan Steven A. Cohen’s SAC Capital Advisors that it is likely to face civil charges over alleged insider trading at the $14 billion firm, a source familiar with the matter said on Wednesday.

The Securities and Exchange Commission issued a so-called Wells notice to SAC, the firm told investors on a Wednesday telephone conference call, said the source, who listened to the call.

NEW YORK (Reuters) – The time may be right for Citigroup (C.N: Quote, Profile, Research, Stock Buzz), long one of the world’s biggest banks by assets, to slim down a little, banking expert Bonnie Baha said on Monday.

“It would make sense to break up Citi,” Baha, portfolio manager of Global Developed Credit at the $50 billion DoubleLine Capital LP, said at the Reuters Global Investment 2013 Outlook Summit. “The odds for that are probably much higher now than they were three months ago.”

BOSTON/NEW YORK (Reuters) – The fallout from the latest insider trading case against a former SAC Capital Group employee could reverberate throughout Steven A. Cohen’s $14 billion (8 billion pounds) hedge fund and impact the billionaire trader himself even though he has not been charged with any wrongdoing.

U.S. securities regulators, in charging former SAC Capital employee Mathew Martoma with insider trading, are also seeking to force the division where he worked to disgorge $276 million (172 million pounds) that was the result of the illicit trades.

BOSTON/NEW YORK (Reuters) – CR Intrinsic, a unit of Steven A. Cohen’s SAC Capital Advisors hedge fund, was long considered the crown jewel in the trader’s $14 billion empire. But now, the SAC-affiliated fund is getting something of a rap sheet.

The fund, which used to manage the bulk of the billionaire trader’s personal money, is where three out of the five former SAC employees implicated in the U.S. government’s insider trading investigation once worked.

NEW YORK (Reuters) – Greg Lippmann’s $2.3 billion hedge fund LibreMax Capital, which produced double-digit gains this year with big and successful bets on residential mortgage securities, is looking to the commercial real estate market to boost returns.

The hedge fund, which gained more than 8 percent in the third quarter, when most funds rose about 5.8 percent, told investors in a quarterly letter reviewed by Reuters that it was “excited about the opportunities in the CMBS credit space” and had increased exposure to those securities in the three months through September 30.

NEW YORK, Nov 19 (Reuters) – Greg Lippmann’s $2.3 billion
hedge fund LibreMax Capital, which produced double-digit gains
this year with big and successful bets on residential mortgage
securities, is looking to the commercial real estate market to
boost returns.

The hedge fund, which gained more than 8 percent in the
third quarter, when most funds rose about 5.8 percent, told
investors in a quarterly letter reviewed by Reuters that it was
“excited about the opportunities in the CMBS credit space” and
had increased exposure to those securities in the three months
through September 30.