How Mike Nierenberg Made His Name

April 2nd, 2019 by admin
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For the past half decade, Mike Nierenberg has been a big name in the investment world, despite having been in it for several years prior. During that time he worked with a variety of industry leaders in a few key positions. Throughout these positions, he honed his craft and learned everything he needed to learn about the investment industry and how to navigate it successfully. Then, when the time was right, he would pounce.

This time came in 2013 when Mike Nierenberg founded New Residential Investment Group; this was something which he envisioned from the ground up to be different from much of the competition. This was because Mr. Nierenberg new that he wouldn’t be able to compete with the industry giants at their own game; in fact, many have market capitalizations between $50 and $60 billion. Because of that, he took a different approach than many other residential investment giants; where they provided a variety of functions, New Residential Investment would only focus on and master a limited few.

Because of this, Mr. Nierenberg knew that he would be able to provide a better service in the residential investment world than he would if he spread himself too thin. This was also on show when Mike Nierenberg decided to limit the companies investments to just real estate securities. This was in direct contrast to much of the competition, who were in a variety of other industries, such as commercial properties, hotels and more. Furthermore, New Residential Investment Group then hedges many of these investments with other interest rate sensitive securities.

According to reports, New Residential uses equity capital on top of borrowed money so that spread between the yield on invested assets and the cost of borrowed funds. This is all to maximize the return on investment for stockholders, according to Mike Nierenberg. The way that the company uses these funds ensures that investments are picked prudently and are managed quite extensively. Through this, Mike Nierenberg has managed to create a market capitalization of $6 billion for New Residential Investment, quite a feat for a company only six years old. However, it shows no signs of slowing down.

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Posted in Business, Investment, Investments

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