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By Matt Doiron

Stanley Druckenmiller was one of the top portfolio managers at George Soros's Quantum Fund, and his returns there combined with his management of Duquesne Capital made him a billionaire. Duquesne closed in 2010 but Druckenmiller still manages money and files 13F documents with the SEC on a quarterly basis which disclose a number of his positions. We went through his filing for the second quarter of 2012 and picked out the five stocks out of the top ten company positions he reported in his portfolio that pay the highest dividend yields (read on or see more of Stanley Druckenmiller's favorite stocks).

The highest dividend yield out of the companies ranked highly in Druckenmiller's portfolio is Altria Group (NYSE:MO) at 4.7%. The $68 billion market cap cigarette company doesn't have very many potential investments for growth and doesn't feel the need to hoard cash for a downturn, so it pays out dividends to investors that make it an attractive income investment. Druckenmiller reported earning 3.4 million shares at the end of the second quarter. Altria also does not have much downside from a value perspective, with earnings multiples in the low to mid teens. Citadel Investment Group added to its position in Altria Group in the second quarter.

Eli Lilly (NYSE:LLY) is another income play at a 4.6% dividend yield, and Druckenmiller initiated a 1.2 million share position in the stock in the second quarter of 2012. Eli Lilly manufactures and sells drugs which treat a variety of neurological problems, diabetes, and cancer. Revenue and earnings declined in the last quarter compared to the same period in the previous year, and at current prices the company trades at 12 times trailing earnings and 11 times forward earnings estimates. At those levels we would characterize it not only as an income stock but also as a value stock. Renaissance Technologies reported a large position in the stock on its own 13F.

Another top pick in the portfolio that pays a good dividend yield is drug manufacturer Merck (NYSE:MRK). Here the dividend yield is 3.8% and Druckenmiller's position at the end of June (as it was at the end of March) was 1.3 million shares. Merck is a bit higher priced than Eli Lilly at a trailing P/E of 20, but sell-side analysts expect strong growth in earnings per share in 2013: the forward multiple, based on those estimates, is 12. Even if growth isn't quite that strong Merck could still look reasonably priced.

A fourth company in Druckenmiller's portfolio that pays a good yield (3.7% in this case) is yet another pharmaceutical company, Pfizer (NYSE:PFE). 2.3 million shares were reported on the 13F, unchanged from the first quarter. Here again Wall Street analysts expect high earnings growth, pulling a moderate trailing earnings multiple of 18 down to a forward P/E of 10. Even with earnings rising 25% last quarter compared to the same period in 2011 that sounds like a tall order, but the company appears better priced than Merck for just a hair thinner on the dividend side.

Finally, Kraft (KFT) pays a 2.8% dividend yield at current prices. The owner of brands such as Oreo, Nabisco, and Oscar Mayer is a good consumer staple pick that has a good deal of downside protection for a consumer company (its dividend yield, plus a beta of only 0.3). We would note, however, that the stock currently trades at 21 times trailing earnings. Sell-side analysts expect 2013 to be a very good year for Kraft, and their expectations imply a forward P/E of only 15, but those growth targets seem a bit high for us. Druckenmiller owned 1.3 million shares of Kraft at the end of June.

With interest rates low, any of these stocks pay a better yield than many investors might be able to get from their bank. There are of course risks of the price declining, but any of them may still offer a good way to augment an investor's income if a portion of wealth is allocated to high dividend stocks.

Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.

Business relationship disclosure: This article is written by Insider Monkey's writer, Matt Doiron, and edited by Meena Krishnamsetty. They don't have any business relationships with any of the companies mentioned in this article and they didn't receive compensation (other than from Insider Monkey and Seeking Alpha) to write this article.