Bloomberg Spotlights A Mortgage Debt Picker's Success
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Thursday, December 13, 2012

Bloomberg Spotlights A Mortgage Debt Picker's Success

It takes a stiff upper lip to found a firm that invests in risky debt at the height of a financial crisis. But it's a move that has paid off for Angel Oak Capital Advisors [profile] co-founder Brad Friedlander.

Today Bloomberg reporter Charles Stein uses hisprofile of Angel Oak and Friedlander to tell a broader story about the rebound of mortgage-backed securities -- and the mutual funds that trade them -- in the years since the financial crisis. Friedlander left his job at Washington Mutual, where he managed $8 billion in fixed income, to found Angel Oak just six months before WaMu failed. And he went on to invest in the same kinds risky mortgages that brought down his former employer.

Stein writes that "[t]he housing crash… has turned into a sustained recovery benefitting buyers of subprime and other risky home loans that fueled the boom." He mentions several funds that have struck gold by buying these loans, including the $570 million Angel Oak Multi-Strategy Income Fund, which has returned 23 percent this year, beating 99 percent of its peers, and DoubleLine's Total Return Fund.

The 35-year-old Friedlander says he may diversify away from residential mortgage-backed bonds in the future, possibly into student debt, commercial mortgages, and CLOs.

"The rally is not going to continue forever but we are not close to the end," he says.

Read the whole profile
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