Some firms have pared their bets in non-agency securities after this year's gains. Western Asset Management Co., which oversees about $443 billion and started 2012 among the most bullish on the debt, sold some investments after "an intense rally," said Paul Jablansky, co-head of the Pasadena, California-based firm's mortgage group. The Legg Mason Inc. unit is replacing the debt with notes such as high-yield company bonds, though it remains "long-term attractive," he said.

Senior non-agency bonds may yield 12 percent for some option ARM debt to 4.5 percent for certain securities backed by larger "jumbo" mortgages, under a "base scenario," according to a Bank of America Corp. report. The option ARM notes could pay 14.5 percent if losses per defaulted loan are 20 percent lower than projected, or 9.2 percent if 20 percent higher, according to the lender's calculations.

No Leverage

The new fund, which won't use derivatives or leverage, will be structured as a limited partnership with minimum investments of $500,000, a lifespan of three years and a 0.95 percent management fee, according to the document.

Cerberus, the New York-based private-equity firm, last year raised $800 million for an RMBS Opportunities Fund that began in August, according to a person familiar with the matter. Bass of Dallas-based Hayman Capital Management LP, who made $500 million betting against subprime debt in the crash, is also seeking money for a new fund, according to two people with knowledge of the plan, who asked not to be identified because the information is private.

Other firms that have recently started funds include Canyon Partners, the Los Angeles-based investment firm overseeing $18.5 billion, and the $11.2 billion money-management firm CQS U.K., run by Michael Hintze in London. Its CQS ABS Alpha Fund, managed by Alistair Lumsden, started last month with $140 million, according to a Feb. 2 letter sent to clients.

Metacapital Seeks

New York-based Metacapital, led by Deepak Narula, is seeking money for its Metacapital Mortgage Value Fund, which will begin trading in May, according to a person with knowledge of the matter.

Fixed-income managers such as Pacific Investment Management Co.'s Bill Gross and Jeffrey Gundlach, who was at TCW Group Inc. before forming DoubleLine Capital LP in 2009, started funds to take advantage of the collapse in mortgage bonds as the rout that roiled global markets began about five years ago.

The Goldman Sachs marketing document cited increasing homebuilder confidence and housing sales to show the market is stabilizing.

The National Association of Home Builders/Wells Fargo sentiment index of builder confidence in March held at the highest level since June 2007. Sales of previously owned homes in February were near an almost two-year high.