Ellington Mortgage Fund Posts 22% Gain as Firm Plans New Vehicle

An Ellington Management Group fund designed to profit from the pandemic’s disruptions to the mortgage market returned more than 22% in 2020 following its April launch, according to a person with knowledge of the matter.

Now, the firm is setting up a new fund to capitalize on further opportunities in the commercial mortgage sector, the person said.

Last year, the Ellington Mortgage Recovery Fund strategy raised $350 million, most of it by May, and plowed the money into a range of different loans and bonds, including securities backed by residential mortgages that weren’t supported by Fannie Mae or Freddie Mac. ...