Allstate Corp. Chief Executive Officer Thomas Wilson is cuttinglonger-term bonds from the insurer's $77.7 billion fixed-incomeportfolio as he seeks to invest in hotels and toll roads withyields near record lows.

The largest publicly traded U.S. auto and home insurer isshifting course three years after Wilson correctly predicted thatyields would fall and boost the portfolio's value. The assets haverebounded from more than $9 billion in unrealized losses at the endof March 2009 to almost $6 billion in gains as of Sept. 30,according to regulatory filings.

“We are taking some of that $6 billion off the table andeffectively harvesting those interest-rate gains,” Wilson said inan interview in his office at Allstate's Northbrook, Illinoisheadquarters. “We'd rather lock in those gains today, take thecapital gains, and reinvest at a lower interest rate now, becausewe think that interest rates will eventually go up.”