Fortress Investment Group has invested an extra $200 million into its fund for buying distressed triple-A-rated RMBS, according to published reports.
This move underlines the hedge funds target of making significant returns from the damaged sector.
The Fortress mortgage opportunities fund, which has a leveraging strategy with a debt-equity ratio of 2:1, is down about 30% three months after having raised $560 million in the spring.
Fortress, however, remains confident, as investors cant redeem their holdings before a three year lock-in period expires.