Gross says Pimco funds headed back to the top
Pimco CEO Bill Gross is confidant that he can turn things around this year and reverse the record redemptions that hit his $230 billion Pimco Total Return Fund.
Bill Gross said his Pacific Investment Management Co. (Pimco) will rank at the top by the end of 2014.
“Believe me, by the end of 2014, Pimco’s going to be at the top, not close to the middle,” the CEO of the world’s biggest bond fund said during an interview Wednesday.
“We’ve got a thesis here. We’re sticking to our guns, our new guns in terms of the new neutral.”
Gross has struggled in the past year to reverse record redemptions as his $230 billion Pimco Total Return Fund trailed peers.
Total Return, which fell behind 87 percent of rival funds over the past year, has improved its performance to return 0.6 percent in the past month and beat 64 percent of competitors, according to data compiled by Bloomberg.
Gross said he is sticking to the front end of the yield curve, buying bonds maturing in five to seven years.
He’s also focusing on high-yield bonds and risk assets, “which will be not high-returning, but basically stable and low-risk and low-volatility,” according to Gross.
Total Return kept its holdings of Treasurys unchanged in April at 41 percent as the securities gained the most in three months, and mortgage-bond holdings fell to 19 percent, the lowest level since July 2010, the company’s website showed.