According to an official e-mailed statement made by the U.S. research company Morningstar Inc., Pimco Total Return Fund, which is currently the biggest bond fund in the world and is run by Bill Gross, suffered a 4.3-billion-dollar loss in redemptions last month.
One of the spokesmen of Pimco Total Return Fund – Mr. Mark Porterfield made an e-mailed statement, which was cited by Bloomberg: “The Pimco Total Return Fund delivered strong performance in May ahead of 79 percent of peer funds as the bond market sided with Pimco’s new neutral view that policy rates will stay lower for longer. We continue to see opportunity in bonds as a portfolio diversifier and as a way to generate the kind of long-term outperformance that our clients have come to expect from Total Return and all of Pimco’s strategies.”
Morningstar Inc. announced that this was the 13th consecutive month of withdrawals from the fund, which left it with assets estimated at 229 billion dollars. The company had a peak of 293 billion dollar in assets last year. Last month, 4.3 billion dollars were reported to have been pulled out by investors. This is considered the largest outflow on a monthly basis since October 2013 and an increase from the 3.1-billion-dollar withdrawals posted in both April and March.
Recently, the funds performance was closely monitored by investors, especially after the resignation of its former high-profile Chief Executive Officer – Mr. Mohamed El-Erian earlier in 2014. The departure of Mr. El-Erian was totally unexpected and shocked the investors community.
The fund has now shift its focus to reshuffling its management team in order to consolidate the company. Six new deputy Chief Investment Officers have been appointed, including Mr. Paul McCulley, who occupied the position of senior executive in the company.
As reported by the Wall Street Journal, the Chief Investment Officer of Budros, Ruhlin & Roe, which has $175 million holdings in the fund, – Mr. Daniel B. Roe commented on the funds performance: “It’s too short term to mean much but he was back near the top of the list of his peers for the last month. As to turning the tide, I think they may be close provided Gross can drive solid returns from here.”
Pimco Total Return Fund was 0.18% down to close at 10.93 dollars per share yesterday, marking a one-year change of +1.56%.
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