Founder and managing partner, Metacapital Management
Deepak Narula knows mortgage-backed securities, and it shows. The former Lehman trader's $1.5 billion mortgage-focused hedge fund has left others in the industry in the dust this year, posting 37% returns through October (the hedge fund industry average for the period is 4.5%). Metacapital has outpaced other funds for years -- it's up 520% since 2008 -- by taking positions with near perfect foresight of policy change and movement in the housing market.
This year, they've won big both on agency mortgage backed securities that have risen in value with QE3 -- the Fed is buying $40 billion in mortgage backed securities per month -- and non-agency mortgage backed securities, which have done well as housing has recovered.
Narula credits Metacapital's team of seasoned investment professionals for the performance. Narula, who was born in India and graduated with an engineering degree, can put himself in that category: He has focused on mortgages since the late '80s. --EF
He's a pro-customer, tightfisted risk-taker who is conditioning Wall Street to embrace his erratic earnings. If you're running a business with high margins - watch out.