The firm where Bill Gross made his name is showing support for his latest venture.
Pacific Life Insurance Co., the insurer where Pacific Investment Management Co. started as a bond unit in 1971, is moving some money to Gross’s new firm, Janus Capital Group Inc. (JNS) Pacific Life, which said the decision pre-dated Gross’s exit, asked the Securities and Exchange Commission for permission to move certain separate accounts to Janus Aspen Series Balanced Portfolio from the PIMCO Global Multi-Asset Managed Allocation Portfolio, according to filings on Monday. Gross isn’t affiliated with the PIMCO accounts or the Janus Aspen Series Balanced fund.
Pacific Life is among several large investors that have moved money from PIMCO in recent weeks. Ford Motor Co., Massachusetts Mutual Life Insurance Co., Alabama’s Treasury, and Florida’s state pension have all reallocated funds after the surprise departure of 70-year-old Gross. Investors rattled by the change pulled a record $23.5 billion in September from the Total Return Fund he ran until he left on Sept. 26. They’re moving money to competing funds, or parking it in money-market funds and exchange-traded funds while they reevaluate.
Pacific Life’s decision “was made in the first half of 2014, prior to, and unrelated to, the recent departure by Bill Gross,” Marisa Schaeffer, a spokeswoman for the insurer, said in an e-mail, noting that the Janus Aspen Balanced Portfolio has been an investment option at Pacific Life since Jan. 2, 2013. “Pacific Life continues to offer other portfolios managed by PIMCO in our Variable Life, Variable Annuity, and Mutual Fund product lines.”
Mark Porterfield, a spokesman for PIMCO, declined to comment on the account changes.
“We continue to see a lot of assets in movement across the fixed-income industry and we believe Janus is well positioned to gather flows as a result,” Steven Shapiro, a spokesman for Denver-based Janus with Communications Strategy Group, said in an e-mail. “Our Balanced fund has excellent performance and is one of our strategies that we believe will benefit from the changing landscape in the fixed-income industry.”
Ford is dropping PIMCO’s Total Return Fund (PTTRX) from the investment options offered to employees, citing Gross’s exit.
Effective Nov. 14, the $202 billion PIMCO Total Return Fund will be removed from Ford’s investment lineup, Becky Sanch, a spokeswoman for Dearborn, Michigan-based Ford, said in an e-mail. Participant balances and future contributions will be transferred to the Bond Index Fund, which is invested in a collective investment fund through a unit of BlackRock Inc. and has the same benchmark as the PIMCO fund. Employees can transfer out of the PIMCO fund any time before Nov. 14, she said.
“This decision was made after the recent resignation of Bill Gross,” Sanch said.
MassMutual is replacing PIMCO Total Return Bond Fund with TCW Group Inc.’s Metropolitan West Asset Management as subadviser to its $1.55 billion MassMutual Select Total Return Bond Fund (MSPGX), effective Oct. 27, according to a supplement to the fund’s prospectus dated yesterday. The fund is also dropping PIMCO from its name.
“MassMutual and the Fund’s board of trustees believe this subadviser change is in the best interest of the Fund’s shareholders and arrived at the decision to replace PIMCO with MetWest through MassMutual’s ongoing subadviser research and analysis process,” David Potter, a spokesman for the insurer’s retirement unit, said in an e-mail. The change is only to the one fund, and has “no impact on any other PIMCO-managed investment options available through MassMutual,” he wrote.
The $39 billion MetWest Total Return Bond Fund (MWTIX), managed by Tad Rivelle, Stephen Kane and Laird Landmann, has returned 5.5 percent this year, beating 65 percent of peers, according to data compiled by Bloomberg.
MassMutual’s investment portfolio stood at $126.5 billion on Dec. 31, according to the annual report from the Springfield, Massachusetts-based insurer.