Western Asset Mortgage Capital’s CEO Invests Another $100K

Billionaire Israel Englander’s Millennium Management came close to doubling its holdings of Western Asset during the third quarter of 2012, closing September with about 960,000 shares in the fund’s portfolio (check out Englander’s favorite stocks). Western Asset was also one of the ten largest stock positions reported on Pine River Capital Management’s 13F, and Fortress Investment Group initiated a position of 900,000 shares over the course of the quarter (see more stock picks from Fortress Investment Group).

Other popular picks for income investors include Altria Group, Inc. (NYSE:MO), AT&T Inc. (NYSE:T), and Verizon Communications Inc. (NYSE:VZ). These stocks tend to pay dividend yields in the 5% range, which is lower than what would be expected from an REIT, although their businesses are likely more understandable and predictable. They are also very well capitalized- Altria is the only one of these three with a market cap less than $100 billion, and it is close to $70 billion by that metric. In addition, while Verizon and AT&T tend to have high trailing earnings multiples, Altria is priced at only 17 times trailing earnings and 14 times forward earnings estimates. Their yield probably wouldn’t be as high as that of Western Asset or its peers, but investors who are willing to give up some income in order to be more safely invested and in order to better understand the value of the underlying company might prefer these high-yield large-cap stocks.