Hedge-fund firms Saba Capital Management LP and Pine River Capital Management are piling into closed-end debt funds with share prices that plunged below the value of their assets by the most since the credit crisis.

Saba, the $3.9 billion manager run by Boaz Weinstein, has amassed at least $847.3 million in the publicly traded funds after it started buying them last year, moving into an area traditionally dominated by individual investors, regulatory filings show. Pine River purchased $159.6 million of shares that on average fell as much as 9.1 percent below their holdings in December, the biggest gap since 2009 as measured by Thomas J. Herzfeld Advisors Inc.

Hedge-fund managers are seeking an edge in a market where the riskiest corporate debt is typically yielding 6.06 percent, 3 percentage points less the average of the past decade. They're stepping into funds run by BlackRock Inc. and Pacific Investment Management Co. (Pimco) after retirees and wealthy individuals fled last year in the face of a Federal Reserve pullback from unprecedented stimulus.