Mortgage securities are drawing buyers after tumbling last year and handing billionaire hedge fund manager John Paulson his first loss in the bond market, Bloomberg reports.
Paulson, who made $15 billion in 2007 betting against U.S. subprime mortgages, is sticking with bullish investments in residential and commercial mortgage securities, helping his Credit Opportunities Ltd. fund gain about 1 percent last quarter to narrow its 2011 decline to 18 percent.
Renewed demand is helping to fuel a rebound that’s allowing the Federal Reserve Bank of New York to attract buyers for bonds it took over during the rescue of American International Group Inc. (AIG) in 2008. It dropped efforts in June to sell that debt after sending prices tumbling in credit markets. Neuberger Berman Group LLC, Pine River Capital Management LP and Metacapital Management LP also see value in the $1.1 trillion market for non-agency debt, or home-loan bonds without government backing….
Find out more at http://www.bloomberg.com/news/2012-01-13/billionaire-paulson-persisting-with-property-as-prices-rebound-mortgages.html
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