Forbes – Value-oriented hedge fund Kingstown Capital Management may have a problem after the firm rushed headlong into the shares of mortgage servicing giant Ocwen Financial amid the firm’s regulatory troubles in 2014.
Ocwen’s plunging shares accounted for 13.94% of Kingstown Capital’s equity portfolio as of the third quarter, according to public filings compiled by FactSet, after the hedge fund tripled its stake in the William Erbey-founded mortgage servicer during the quarter. Were Kingstown to have held onto those Ocwen shares through the company’s battles with New York Department of Financial Services superintendent Ben Lawsky this fall, the hedge fund may be bleeding red.
