Managers Split on Subprime

Some money managers are looking beyond the real estate business for opportunities tied to the recent plunge of subprime lending stocks.

Mortgage companies such as Accredited Home (LEND Quote), Fremont General (FMT Quote) and NovaStar (NFI Quote) have become some of the most heavily traded names on Wall Street since problems have emerged in the business of lending to homebuyers with weak credit histories.

Shares in the sector were hammered when lenders ranging from HSBC (HBC Quote) to New Century (NEWC Quote) admitted that recent loans were going bad at a rapid clip. Selling fed what one mortgage company called an "irrational panic" in the business of selling mortgages as securities, though recently fears have subsided somewhat as big investors said they would be bottom-fishing. ...