Investors pull $7bn from Pimco’s total return fund during August

City A.M. Reporter
BILL Gross’s Pimco Total Return Fund, the world’s largest bond fund, lost $41bn (£26.2bn) of its assets in the past four months through withdrawals and price losses, according to data from Morningstar yesterday.

The Pimco Total Return Fund, which had $7.7bn in net cash outflows in August alone, has seen its assets shrink by 14 per cent to $251bn at the end of August from $292bn at the end of April, Morningstar added.

Investors have pulled cash out of bond funds this year as rising interest rates have made fixed-income securities vulnerable to price losses. Gross and his co-chief investment officer at Pimco, Mohamed El-Erian, are watched closely because they have made money by anticipating big moves in the economy and interest rates way before other investors.

Investors have pulled about $26bn from the fund since the start of May, Morningstar data shows. In addition, the fund sustained losses of roughly $15bn over that period as the fund has declined 5.5 per cent since the end of April, preliminary data from Morningstar shows.