Cliff Asness’s 3%+ Yield Investments Include AT&T Inc. (T)

The fund also included Pfizer Inc. (NYSE:PFE) among its top picks from its most recent filing. The pharmaceutical company has been in the process of selling off different segments of its business for the past couple years, most recently spinning out Zoetis Inc (NYSE:ZTS), which had previously been its animal health unit. Many investors like companies engaged in spinouts on the theory that management may become more focused on the core business, improving operations. Pfizer Inc. (NYSE:PFE) had been billionaire Ken Fisher of Fisher Asset Management’s top stock pick for 2013; it has underperformed the S&P 500 year to date.

AT&T Inc. (NYSE:T) was another of Asness’s high yield stock picks with the filing disclosing ownership of 5.1 million shares. Telecom giants tend to make attractive income or defensive stocks, and AT&T Inc. (NYSE:T) is no exception with an annual yield of about 5% and with little exposure to the overall economy (the stock’s beta is 0.3). Wall Street analysts expect $2.69 in earnings per share in 2014, which makes for a forward earnings multiple of 13. Billionaire David Harding’s Winton Capital Management, which invests in many high yield names, was another shareholder in AT&T Inc. (NYSE:T) (research more stocks Harding likes).

According to the filing, AQR’s largest new position in the first quarter of 2013 was its 2.9 million shares of LyondellBasell Industries NV (NYSE:LYB). As a specialty chemicals company LyondellBasell Industries NV (NYSE:LYB) is highly dependent on macro demand as shown by its beta of 2.5. The stock trades at trailing and forward earnings multiples of 13 and 10 respectively, so it is not that expensive on a trailing basis and the sell-side at least expects EPS to increase going forward. Viking Global owned over 13 million shares of LyondellBasell at the beginning of April; that fund is managed by billionaire Andreas Halvorsen (see more stocks Viking Global owns).

Disclosure: I own no shares of any stocks mentioned in this article.