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March 15, 2011 at 12:03 PM
PIMCO bond guru Bill Gross has made headlines once again, this time by launching a new version of his Total Return Fund that eschews the risky high-yield strategies that grew the original Total Return into the world’s largest mutual fund.
Called the PIMCO Total Return Fund IV in a February regulatory filing, the new fund will forgo high-yield debt, borrowing to create leverage and investing in derivatives such as options, Bloomberg reported in a news story on March 11.
The new fund will provide an alternative to the PIMCO Total Return Fund, but it won’t replace the original, Bloomberg reported.
Gross (left), the co-founder of Pacific Investment Management Co. in Newport Beach, Calif., is tinkering with a strategy that helped him beat 98% of rivals over almost 24 years and attract $25.1 billion of new deposits last year,” according to Bloomberg. “With Gross forecasting an end of the three-decade bond rally, PIMCO may be targeting investors who prefer a more conservative approach over the risks associated with excess yields, according to Francois Otieno, a senior fixed-income analyst at Hewitt EnnisKnupp, which advises institutional investors.”
On March 4, Gross was in the news when he urged lawmakers to cut the massive federal deficit. In response to the federal government’s projected
