New York (HedgeCo.Net) Hedge funds are speculating that some of the mortgage insurers hit the worst by the U.S. housing crisis will big winners in the rebound.
Hedge funds Paulson & Co. and Maverick Capital have both made serious investments into the struggling sector.
‘Maverick, run by Lee Ainslie, added 23.6 million shares of MGIC Investment Corp. (MTG) in the first quarter as the stock almost doubled, according to regulatory filings. Billionaire John Paulson’s $18 billion hedge-fund firm acquired 17 million shares of MGIC and 8 million of rivalRadian Group Inc. (RDN).” Bloomberg reports.
Mortgage insurers cover losses when homeowners default and foreclosures fail to recoup costs. The coverage is typically required when homeowners make a down payment of less than 20 percent.
Alex Akesson
For HedgeCo.net
alex@hedgeco.net
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