A trader at Goldman Sachs who successfully bet against crumbling US sub-prime mortgages has left the securities firm to form a $1 billion hedge fund, Bloomberg reported. Josh Birnbaum confirmed his departure and declined to elaborate on his plans. He has told colleagues he expects his new fund will invest in mortgage assets, according to two people familiar with the matter. At least 70 funds have been established during the past year by firms such as New York-based Goldman, Blackstone Group and Pacific Investment Management to snap up cheap home-loan debt amid the steepest drop in US home values since the Great Depression. Mr Birnbaum helped Goldman offset losses on mortgage holdings and earn a record $11.6 billion last year. Mr Birnbaum and Michael Swenson, another structured-products trader, pushed for Goldman's bets on a sub-prime collapse with backing from Dan Sparks, its mortgage-department head, the Wall Street Journal reported last December. Michael Duvally, a company spokesman, declined to comment. Mr Birnbaum, a native of Oakland, California, joined Goldman in 1993.