What’s all this talk about distressed mortgage assets being an opportunity of a lifetime? We’re pretty sure we saw something on CNBC about that.
But whoops, turns out that investing in distressed mortgages can be hazardous for your financial health.
PIMCO, which launched a distressed mortgage fund in late 2007, is down 34% since its inception, according to documents obtained by peHUB. Now, you might give them a pass, since late 2007 was early on in the mortgage crisis.
But it turns out that the fund was down 25% in Q4 alone.
The firm — which as everyone knows is going to be one of the big players in the bailout scheme — is currently trying to raise a second fund to buy distressed mortgages. But it’s going horribly. Again, according to peHUB, theyv’e raised just $225 in 7 months, though the goal was to hit $3 billion.