Tags: Bill Gross | bond | fund | Pimco

Bill Gross Gets Beaten by Pimco Total Return Fund He Started

Bill Gross Gets Beaten by Pimco Total Return Fund He Started
Bill Gross (Photo: Getty Images)

By    |   Monday, 28 September 2015 06:00 AM

“Bond king” Bill Gross left Pimco a year ago, but he didn’t bring his record of beating other debt funds with him.

His former flagship fund handily outperformed an asset pool he started at rival Janus Capital.

The Janus Unconstrained Fund declined 2.5 percent in the past year, while the Pimco Total Return fund gained 1.7 percent under the stewardship of three lesser-known managers.

“By underperforming, Mr. Gross may be inadvertently helping Pimco make its own case: that the investment process, trading infrastructure and intellectual firepower across the asset management group count for as much, if not more, than any one individual’s investing talent,” according to a report by the Financial Times.

Gross’s departure from the company he co-founded rattled debt markets as investors expected massive redemptions from Total Return, which was the world’s biggest bond fund with $293 billion under management in April 2013.

Investors started to pull money from the fund last year, and Gross resigned in September 2014 in anticipation of getting fired the next day, according to media reports. Outflows accelerated after his departure.

The fund reported assets of $98.1 billion as of August 31, the first time below $100 billion since 2007.

But not all the outflows followed Gross to his new fund.

Of the $120 billion withdrawn from Pimco funds, only $1 billion went into his Janus fund, the FT reported.

“It sort of suggests that at least [Pimco’s system] was not broken, the system was not compromised, not just by the absence of Bill Gross but by the massive outflows of investor funds from their products,” Yahoo Finance’s Mike Santoli says. “That was what was considered to be the big danger was that Pimco Total Return and other funds that Gross oversaw in a broader way would basically not be able to operate well if they were having to hemorrhage money and give investor cash back.”

© 2020 Newsmax Finance. All rights reserved.

   
1Like our page
2Share
StreetTalk
"Bond king" Bill Gross left Pimco a year ago, but he didn't bring his record of beating other debt funds with him. His former flagship fund handily outperformed an asset pool he started at rival Janus Capital.
Bill Gross, bond, fund, Pimco
315
2015-00-28
Monday, 28 September 2015 06:00 AM
Newsmax Media, Inc.
 

Newsmax, Moneynews, Newsmax Health, and Independent. American. are registered trademarks of Newsmax Media, Inc. Newsmax TV, and Newsmax World are trademarks of Newsmax Media, Inc.

NEWSMAX.COM
MONEYNEWS.COM
© Newsmax Media, Inc.
All Rights Reserved