Exhibit 11
Redwood Trust, Inc.
Computation of Per Share Earnings
| Twelve Months | Twelve Months | Twelve Months | ||||||||||
| Ended | Ended | Ended | ||||||||||
| December 31, 2004 | December 31, 2003 | December 31, 2002 | ||||||||||
Basic: |
||||||||||||
Average common shares outstanding |
21,437,253 | 17,759,346 | 15,177,449 | |||||||||
Total |
21,437,253 | 17,759,346 | 15,177,449 | |||||||||
Net Income |
$ | 232,634,946 | $ | 131,698,361 | $ | 53,441,217 | ||||||
Per Share Amount |
$ | 10.85 | $ | 7.42 | $ | 3.52 | ||||||
Diluted: |
||||||||||||
Average common shares outstanding |
21,437,253 | 17,759,346 | 15,177,449 | |||||||||
Net effect of dilutive stock options outstanding during the period — based on the treasury stock method |
791,676 | 827,303 | 481,174 | |||||||||
Net effect of preferred stock |
— | 225,517 | — | |||||||||
Total |
22,228,929 | 18,812,166 | 15,658,623 | |||||||||
Net Income |
$ | 232,634,946 | $ | 131,698,361 | $ | 53,441,217 | ||||||
Per Share Amount |
$ | 10.47 | $ | 7.04 | $ | 3.41 | ||||||