The Pimco Total Return Fund has been haemorrhaging since the departure of Bill Gross to join Janus Capital, with outflows of nearly $17.9 billion (€14.1 billion) in September alone.
Gross co-founded Pimco in 1971, and also held the role of chief investment officer.
Once the largest open-ended mutual fund in the world, the Pimco Total Return Fund has seen outflows every single month since May last year.
Morningstar data shows the fund had $201.6 billion of assets under management at the end of September, down from $292.9 billion in April last year.
The Pimco Total Return Fund lost its status as the largest open-ended mutual fund to the Vanguard Total Stock Market Index fund in November last year. Gross’ departure has raised further questions of which funds may capture some of the assets.
Third quarter results show that Pimco’s assets under management totalled $1,876 billion at the end of September, compared to $1,920 billion at the end of last year. Pimco attributes this drop, which occurred before Gross’ departure, to a number of factors, including portfolio returns, currency changes and net client flows.
Gross quit Pimco in October to join Janus Capital Group to manage the recently launched Janus Global Unconstrained Bond Fund and related strategies.
Morningstar downgraded the Pimco Total Return Fund to a bronze rating after Gross’ departure. Even though its analysts say they are overall positive on the fund, they highlight uncertainty regarding outflows and the reshuffling of management possibilities.
Pimco has since elected Daniel Ivascyn as group chief investment officer; Andrew Balls has been appointed chief investment officer for global fixed income, Mark Kiesel for global credit, Virginie Maisonneuve for global equities, Scott Mather for US core strategies, and Mihir Worah for real return and asset allocation.
Douglas Hodge, the chief executive officer, Lew Jacobs, president, will continue to serve as the Pimco’s senior executive leadership team.
Mather, Kiesel and Worah now co-manage the Pimco Total Return Strategy. Parikh, Fahmi and Ivascyn now co-manage the Pimco Unconstrained Bond Strategy.
(Photo by Figge Photography)
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