Goldman Sachs (GS) is finalizing a capital raise for a U.S. Housing Recovery Fund set to open in April, according to a story on Bloomberg.

The investment giant joined with hedge fund managers Kyle Bass and Metacapital Management to buy mortgage-backed securities now graded at junk. Goldman and Bass made big bets against the housing boom before the crash. Goldman used its controversial hedge to survive the subprime debacle, while Bass made a reported $500 million.

This time, they're each betting on a recovery, according to the story.

"Many of the ingredients are in place for continued improvement in housing," according to a fund document obtained by Bloomberg.

- Jon Prior