PDI - DMO's Proxy Could Spell Trouble For Your Investment

(This report was issued to members of Yield Hunting on Oct. 29. All data herein is from then unless otherwise stated).

Western Asset Mortgage Defined Opportunity (DMO)

This fund is very similar to the PIMCO twins of (PCI) and (PDI) in its focus of non-agency mortgage backed securities. However, it's even more of a pure-play and less "black boxy" than PIMCO given less reliance on the swap and option overlays. More than 72% of the fund is invested in some type of non-agency MBS with another 15% in commercial