The top executives at Thornburg Mortgage Asset Corp. have been purchasing shares of its stock in the wake of an analyst downgrade.

Last week, H. Garrett Thornburg Jr., chief executive of the Santa Fe, N.M.-based real estate investment trust, purchased 6,400 shares. President Larry Goldstone snapped up 1,580.

The executives acted after Joe Jolson, an analyst with Montgomery Securities, San Francisco, downgraded the company to a "hold" despite a report of stronger-than-expected earnings.

After the Fed pushed interest rates up a quarter of a point on March 25, the company watched its stock decline along with the market as a whole.

Part of the investor concern may stem from the fact that the company's earnings fared badly in 1994, the last time interest rates spiked, said Richard Story, chief financial officer.

At that time, the recently formed company held unseasoned portfolios with 90% of the loans still in their teaser-rate stage, Mr. Story said.

"Now, we're much better positioned," he said. "Only 2% of our loans carry teaser rates."

In addition, Mr. Story said that he did not expect interest rates to climb as high as they did three years ago.

Company insiders have been snapping up stock in recent weeks to take advantage of lower prices and show support, Mr. Story said.

Thornburg is working to develop relationships with mortgage originators, he added.

The company is hoping to eventually compete with Fannie Mae and Freddie Mac in bringing conventional mortgage securities to Wall Street.

"Because of our operating-cost structure, we can purchase loans at a lower margin and at a better spread to the originator over time," Mr. Story said.

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