Pimco managers performing well after Bill Gross

Bill Gross Interview Pic

The new managers of the Pimco Total Return Fund have been trumping former boss Bill Gross since he left the world’s largest bond fund, boosted by an opposing bet tied to short-term U.S. interest rates.

Bloomberg News reports that following Gross’s surprise September 26 exit, the trio that took over the $125bn fund reduced its exposure to debt maturing within five years, according to filings.

Gross went the other way on shorter-term debt after joining the Janus Global Unconstrained Bond Fund on October 6, plowing two-thirds of its net assets into corporate bonds coming due before 2018.

The two sides differed last year on when the Federal Reserve would begin to raise interest rates, with Gross signaling a longer wait than those who replaced him at Pimco. Forecasting that the Fed would tighten as early as June, Total Return’s new managers Mark Kiesel, Scott Mather and Mihir Worah concluded that short-term bonds were overpriced and repositioned the fund, helping it to emerge from a two-year slump and outperform Gross’s Janus vehicle.

To access the complete Bloomberg News article hit the link below:

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