FORM 4
Check this box if no longer subject to Section 16. Form 4 or Form 5 obligations may continue. See Instruction 1(b).
UNITED STATES SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

STATEMENT OF CHANGES IN BENEFICIAL OWNERSHIP OF SECURITIES

Filed pursuant to Section 16(a) of the Securities Exchange Act of 1934 or Section 30(h) of the Investment Company Act of 1940
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(Print or Type Responses)
1. Name and Address of Reporting Person *
ZAGUNIS HAROLD F
   2. Issuer Name and Ticker or Trading Symbol
REDWOOD TRUST INC [RWT] 		5. Relationship of Reporting Person(s) to Issuer
(Check all applicable)
_____ Director _____ 10% Owner
__X__ Officer (give title below) _____ Other (specify below)
Chief Financial Officer
(Last)
(First)
(Middle)
1 BELVEDERE PLACE, SUITE 300		 3. Date of Earliest Transaction (Month/Day/Year)
11/29/2004
(Street)

MILL VALLEY, CA 94941		 4. If Amendment, Date Original Filed(Month/Day/Year)
 6. Individual or Joint/Group Filing(Check Applicable Line)
_X_ Form filed by One Reporting Person
___ Form filed by More than One Reporting Person
(City)
(State)
(Zip)
Table I - Non-Derivative Securities Acquired, Disposed of, or Beneficially Owned
1.Title of Security
(Instr. 3)		 2. Transaction Date (Month/Day/Year) 2A. Deemed Execution Date, if any (Month/Day/Year) 3. Transaction Code
(Instr. 8)		 4. Securities Acquired (A) or Disposed of (D)
(Instr. 3, 4 and 5)		 5. Amount of Securities Beneficially Owned Following Reported Transaction(s)
(Instr. 3 and 4)		 6. Ownership Form: Direct (D) or Indirect (I)
(Instr. 4)		 7. Nature of Indirect Beneficial Ownership
(Instr. 4)
Code V Amount (A) or (D) Price
Common Stock 11/29/2004   M   12,140 A $ 36.875 16,790 D  
Common Stock 11/29/2004   S   12,140 D $ 57.4564 4,650 D  
Common Stock 11/30/2004   M   2,038 A $ 13.1875 6,688 D  
Common Stock 11/30/2004   S   2,038 D $ 57.4072 4,650 D  
Common Stock 11/30/2004   M   3,791 A $ 29.25 8,441 D  
Common Stock 11/30/2004   S   3,791 D $ 57.4072 4,650 D  
Common Stock 11/30/2004   M   1,760 A $ 20.25 6,410 D  
Common Stock 11/30/2004   S   1,760 D $ 57.4072 4,650 D  

Reminder: Report on a separate line for each class of securities beneficially owned directly or indirectly.
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Table II - Derivative Securities Acquired, Disposed of, or Beneficially Owned
(e.g., puts, calls, warrants, options, convertible securities)
1. Title of Derivative Security
(Instr. 3)		 2. Conversion or Exercise Price of Derivative Security 3. Transaction Date (Month/Day/Year) 3A. Deemed Execution Date, if any (Month/Day/Year) 4. Transaction Code
(Instr. 8)		 5. Number of Derivative Securities Acquired (A) or Disposed of (D)
(Instr. 3, 4, and 5)		 6. Date Exercisable and Expiration Date
(Month/Day/Year)		 7. Title and Amount of Underlying Securities
(Instr. 3 and 4)		 8. Price of Derivative Security
(Instr. 5)		 9. Number of Derivative Securities Beneficially Owned Following Reported Transaction(s)
(Instr. 4)		 10. Ownership Form of Derivative Security: Direct (D) or Indirect (I)
(Instr. 4)		 11. Nature of Indirect Beneficial Ownership
(Instr. 4)
Code V (A) (D) Date Exercisable Expiration Date Title Amount or Number of Shares
Incentive Stock Option (right to buy) $ 20.25 11/30/2004   M     1,760   (1) 12/23/2007 Common Stock 1,760 $ 0 0 D  
Incentive Stock Option (right to buy) $ 29.25 11/30/2004   M     3,791   (2) 10/17/2007 Common Stock 3,791 $ 0 0 D  
Incentive Stock Option (right to buy) $ 36.875 11/29/2004   M     12,140   (3) 12/13/2006 Common Stock 12,140 $ 0 2,360 D  
Non-Qualified Stock Option (right to buy) $ 13.1875 11/30/2004   M     2,038   (4) 12/17/2008 Common Stock 2,038 $ 0 0 D  

Reporting Owners

Reporting Owner Name / Address Relationships
 Director  10% Owner  Officer  Other
ZAGUNIS HAROLD F
1 BELVEDERE PLACE
SUITE 300
MILL VALLEY, CA 94941		       Chief Financial Officer  

Signatures

 Harold F. Zagunis   12/01/2004
**Signature of Reporting Person Date

Explanation of Responses:

* If the form is filed by more than one reporting person, see Instruction 4(b)(v).
** Intentional misstatements or omissions of facts constitute Federal Criminal Violations. See 18 U.S.C. 1001 and 15 U.S.C. 78ff(a).
(1) The option becomes exercisable in four equal installments on the 4th day of May in 2002, 2003, 2004, and 2005
(2) The option becomes exercisable in four equal installments on the 4th day of May in 1999, 2000, 2001, and 2002
(3) 2,700 options are exercisable on December 31, 1996. The remaining options become exercisable in ten equal installments of 1,180 on the 4th day of May from 1997 through 2006.
(4) The option becomes exercisable in four equal installments on the 4th day of May in 2000, 2001, 2002, 2003

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