Deer Park Road Management launched a closed-end fund focused on legacy, non-agency residential mortgage-backed securities (RMBS).
Deer Park Mortgage Opportunity Fund I will invest in RMBS, while also seeking to provide access to the current trade opportunities in the structured credit market. Officials did not disclose a fundraising target or hard cap for the new fund.
Earlier this year, the firm launched its seventh CLO since 2018. The $504 million issue, Deerpath CLO 2023-1, brought the firm’s CLO assets under management to $2.3 billion. Deer Park is also known for its flagship hedge fund.
“We believe that liquidity-driven technical factors have driven spreads and relative returns to historically wide levels, resulting in the RMBS sector now trading at levels that offer compelling performance with diminished credit risk,” said Scott Burg, chief investment officer and managing partner of Deer Park, which has roughly $3.3 billion in assets under management.
The Steamboat Springs, Colo.-based firm was founded in 2010 and the team has decades of credit investment experience across cycles identifying and investing in bonds trading at less than their intrinsic value with the intention of holding them to term.