what's the difference between a mREIT and a MBS hedgefund?
Trader here wondering about the differences between a mREIT and a mortgage hedgefund since they both invest in MBS. Besides pay and mandates, what are the differences between the two?
Trader here wondering about the differences between a mREIT and a mortgage hedgefund since they both invest in MBS. Besides pay and mandates, what are the differences between the two?
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A "REIT" = Real Estate Investment Trust, is a specific IRS tax classification that allows qualified investments in real property (includes mortgages) to be exempt from corporate taxation. Mortgage REITs are often publicly registered (wide ownership is a requirement) and often traded on an exchange, like the NYSE. A hedgefund is an un-registered investment company that can only issue private securities and not publicly tradeable. So the real differences is how they raise money, from whom the raise it, and how liquid those investments are.
Most mREITs are directly originating and writing loans, whereas hedge funds are typically looking to buy distressed notes. Hedge funds typically climb higher up the credit structure than mREITs will as well.
This
Kinda wish mREITs were talked about more here bc they’re a great gig for finance & RE interested ppl. Too often overlooked. I’m a 1st year analyst at a large mREIT. Comp is $75K all in. Hours are long, but if you’re a geek about this stuff, which you kinda have to be to succeed here, it’s okay.
why do you want to move to an ABS HF if you're advocating hard for mREITS?
also that pay seems a bit low. Are you in a low COL city?
I don’t think those two things are mutually exclusive in this context. The intention of the prior post was to attempt to illustrate the diversity of first year analyst roles at an mREIT and add color to the difference between mREITs and HFs. Not to say ‘x’ is better than ‘y’.
I’m on the sell-side but its true, you don’t hear much about mREITs, nor have I looked at that as possible future exit opps if I ever decide to make the next leap. I do echo the above poster saying that 75k all-in is drastically low. Why would a structured finance analyst be making 150-175k at top banks in the space like JPM/ BaML/WFC regardless of location and jump to a mREIT for half or less than half the pay? I Feel like a structured credit focused HF would be a better route. Though I do like that the mREITs get their hands dirtier by going into the Z-tranche or certificates vs just BBB/A relative value trades. Any examples of the biggest or most well-known mREITs?
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