DISTRESSED INVESTOR: 'We're getting closer'

There's a growing sense on Wall Street that markets are close to the top.

That's bad news for some investors, but for a certain bread of investor - those that look to make money from assets which are in distress - these are exciting times.

"What you saw in the third quarter of this year could well have been a harbinger of things to come over the next year or two," Bruce Karsh, CIO and co-chairman of Oaktree Capital Group said October 29 after the company reported earnings.

Oaktree is a giant alternatives manager which specializes in so-called distressed debt, or the bonds of companies that have run into trouble.

These types of investors have struggled for returns post financial crisis, as an extended period of low-interest rates has put a limit on the number of that have fallen into difficulty.

With interest rates set to rise in the near future and bond markets showing signs of stress, some are better than more companies will find themselves under pressure. Deutsche Bank strategists said in October that there could be a wave of bond defaults just around the corner.

Karsh said the private equity firm can "deploy billions of dollars in a short period of time at the right time."

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