Vertical Capital Income Fund (VCAPX), an entity created a year ago to invest in whole mortgage loans and deeds of trust, reported that it outperformed its first-year performance benchmark with returns of 12.95%. That compares to returns of 2.59% for the Barclays U.S. Mortgage-Backed Securities Index, Vertical Capital said in a press release.
The Irvine, Calif.-based fund launched in late December 2011 and reported a dividend of 4.01% on an annualized basis for the year period ending on Dec. 31, 2012.
"VCAPX is potentially benefiting from a Goldilocks effect," said Vertical President Bayard Closser. "The housing market is recovering, but at a pace where lenders are still willing to sell whole mortgage notes at a deep discount. This creates what we believe is a ‘just right’ environment that we believe will continue for at least three more years."