Western Asset Mortgage Opportunity Fund Inc. (NYSE:DMO) experienced a significant increase in short interest during October 2023, rising by 47.9% compared to the previous month. As of October 15, the short interest totaled 31,200 shares, up from 21,100 shares on September 30. This surge indicates heightened interest from investors betting against the fund, with a current short-interest ratio of 0.6 days based on an average daily trading volume of 53,500 shares.
Institutional Investors Adjust Positions
Recent trading activity among institutional investors has marked a notable shift in their positions regarding Western Asset Mortgage Opportunity Fund. Bank of America Corp DE enhanced its stake by 18.6% in the second quarter, now holding 15,490 shares valued at approximately $185,000 after acquiring an additional 2,424 shares. Similarly, Virtu Financial LLC initiated a new position in the first quarter, investing $205,000 in the fund.
Other firms have also adjusted their holdings. Integrated Capital Management Inc. increased its stake by 5.5% in the second quarter, bringing its total to 17,244 shares worth around $206,000. Walleye Capital LLC saw a remarkable 80.5% increase in its shares, now owning 18,064 shares valued at $214,000 after purchasing an additional 8,054 shares. Additionally, Aviance Capital Partners LLC raised its position by 26.0% during the same period, owning 32,343 shares worth approximately $382,000.
Market Performance and Future Outlook
In terms of market performance, shares of Western Asset Mortgage Opportunity Fund traded down by 0.3% to $11.95 during mid-day trading on Tuesday, with a total trading volume of 22,123 shares, below the average volume of 56,829 shares. The fund’s fifty-day simple moving average stands at $11.90, while the two-hundred day moving average is $11.83. The stock has fluctuated between a 52-week low of $10.81 and a high of $12.32.
Western Asset Mortgage Opportunity Fund Inc. is a closed-end fixed income mutual fund managed by Legg Mason Partners Fund Advisor, LLC, and co-managed by Western Asset Management Company. The fund primarily invests in the fixed income markets across the United States.
As investors continue to monitor the fund’s performance and changes in institutional holdings, the recent spike in short interest may signal shifting sentiments about the fund’s future prospects.
