Hedge funds build on mortgage gains
By Lawrence Delevingne
Tue Jul 31, 2012
Firms are piling into the MBS market and putting up lofty returns, but risks remain.
||Source: AR research. All figures as of July 1,
2012. Firm and MBS numbers represent capital in hedge
fund strategies only. Exception: Cerberus firm AUM figure
is comprised primarily of capital in private equity funds
that could not easily be separated from hedge fund
assets. Figures for Marathon, Angelo Gordon, One William
Street, Och-Ziff, York, Hayman, and King Street are
Cerberus Capital Management, Pine River Capital Management
and Canyon Partners are among dozens of firms to earn
market-beating returns this year by investing in mortgage
backed securities. The MBS strategy they employ has become,
almost by default, the most attractive in the hedge fund
Managers have been busy promoting the MBS play all year. "I
simply love the mortgage market. It's the best place to be
right now," said Steve Kuhn, Pine River's mortgage chief, while
speaking at the 2012 SALT Conference in May about the...
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