Corriente Capital Management of Fort Worth and Hayman Capital Partners of Dallas have jointly launched a hedge fund designed to profit from an expected weakness in the residential mortgage market.
Subprime Credit Strategies Fund now has about $61 million, is managed jointly by Corriente founder Mark Hart and Hayman founder Kyle Bass. The portfolio invests in credit default swaps written on tranches of residential mortgage-backed securities. Subprime is poised to collect payments from the CDS should the reference RMBS default. The firm could also profit by selling the appreciated CDS securities.
Specifically, Hart and Hayman are