Bear Stearns Cos., the manager of two hedge funds that collapsed last month, blocked investors from pulling money out of a third fund as losses in the credit markets expand beyond securities related to subprime mortgages.

The Bear Stearns Asset-Backed Securities Fund had less than 0.5% of its $900 million of assets in securities linked to subprime loans, spokesman Russell Sherman said in an interview Tuesday.

Investors concerned about losses sought to withdraw their money, he said.

Shares of New York-based Bear Stearns fell as much as 6%, pushing some brokerage stocks lower on concern about shrinking profits from debt underwriting and trading. Bear Stearns triggered a decline in credit markets in June, when funds it managed faltered after defaults on home-loans to people with poor credit rose to a 10-year high.

“There will be more pain,” said Felix Stephen, a strategist who helps oversee the equivalent of $7.5 billion at Advance Asset Management Ltd. in Sydney. “I’m giving it a couple of months at least. It’s not the subprime issue that really matters, it is the first card to fall in the tower of cards in this situation.”