Bill Miller believes things are better than people believe, and he's betting big money on this optimism.

The Legg Mason [profile] PM seeks to redeem the company's reputation by putting money on housing, according to InvestmentNews.

The publication reports that Legg Mason Capital Management Opportunity Trust invested roughly one-third of its assets on a property rebound through loan insurers, mortgage real estate investments trusts and homebuilders.

A notable quote from Miller on his faith in the sector:

“Housing fundamentals are likely to be positive for years. The stocks have run, but in our judgment are not even close to reflecting that long cycle.”

When it comes to housing, he also believes that "things are better than people believe, not worse."

Some of his best bets this year are PulteGroup Inc, Ellington Financial and Bank of America.

Such bets propelled the $952 million fund to a return of 29 percent this year through Oct. 11, surpassing 99 percent of peers, according to data compiled by Bloomberg. The fund lost 35 percent in 2011, last among its category, when he prematurely bet on a recovery.

To read more about Miller's rosy housing picture, read the full article at the InvestmentNews website. 

Edited by: HFD


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