PIMCO’s assets under management fell 5% in the third quarter, according to figures the firm released on Oct. 10. As of Sept. 30, the fixed-income shop had $1.876 trillion in AUM vs. $1.973 trillion on June 30.

“Changes in AUM are a function of a number of factors, including portfolio returns, currency changes and net client flows,” the group said in a statement. Its various funds had “a range of returns and client flows for the quarter.”

On Oct. 1, PIMCO said net outflows from the Total Return Fund, formerly managed by Bill Gross—who left the firm abruptly in late September to join rival Janus Capital Group—were an estimated $23.5 billion. “Of note,” the company explained, “the largest daily outflow occurred on the day of Bill Gross’s resignation from the firm, while outflows on the two following days were considerably smaller.”

Recently, Jeff Tjornhoj, head of research for Lipper-Americas, gave his view on Gross’ exit from PIMCO, calling it “the biggest news for bond funds [in] this past quarter” and attributing the move to “internal strife with executive management [that] grew too distracting for either side to bear.”

Gross left “before he could be fired,” explained. “It was a watershed moment for the fund industry to see a titan such as Bill Gross lose control of one of the largest mutual funds in the world. We’ll be curious to see how the next chapter of his career evolves at Janus.”

Meanwhile, PIMCO says investors are “showing confidence in PIMCO,” as demonstrated by the roughly $6.5 billion that has moved into the PIMCO Income Fund.

In mid-October, Morningstar said it “still likes” the Total Return Fund, despite its continued spate of outflows. The research group downgraded its rating on the fund to bronze from gold following Gross’ career move.

“The underlying material that has driven the [Total Return] fund is still there,” said Eric Jacobson, senior analyst of active strategies, on a conference call.

John Hale, Morningstar’s director of manager research for North America, adds that while the Total Return Fund has seen “significant outflows,” PIMCO has “sufficient liquidity” to handle those outflows—at least in the short-term.

In the wake of Gross’ departure, PIMCO appointed Daniel Ivascyn as the its new group chief investment officer. Ivascyn has served as deputy CIO since January and has managed the $38 billion PIMCO Income Fund; he joined PIMCO in 1998. The firm also appointed Scott Mather, Mark Kiesel and Mihir Worah as portfolio managers for the PIMCO Total Return Fund and ETF.

At Janus, Gross is managing the Global Unconstrained Bond Fund, which launched in May 2014, and “related strategies,” according to his new employer. He will work with the company’s fixed-income chief investment officer, Gibson Smith, and CEO Dick Weil.

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Geopolitical risks are rising around the world and dragging down the global economy, according to an investment outlook written by Mather and Greg Sharenow, executive vice president at PIMCO, and published in mid-October. They argue that there are three “clear policy tools” that could help counter the admittedly “extremely complicated” problems geopolitical risks create, particularly regarding energy.

European central banks and governments should coordinate their efforts to offset negative economic effects; leaders in Europe should develop policies to wean themselves off Russian energy sources; and the United States should revisit its “long-standing policy against oil exports” and position itself as an energy supplier.

Europe is in a tenuous position, according to Mather and Sharenow, who called its economic recovery “fragile.” Although the region started 2014 with optimism, in just six months, confidence and growth have both fallen, and the disinflationary forces in play at the beginning of the year haven’t improved.

“Although a near-infinite number of scenarios can be constructed with many economic outcomes, it is clear that both proactive fiscal and monetary policy should be considered to combat deflation and support the fragile economies,” they wrote. Mather and Sharenow suggest relaxed budget constraints and an accommodative monetary policy in Europe, including quantitative easing, as the best approach.

Energy plays a pivotal role in the conflict in Europe and its recovery. Ukraine’s role as a transit state through which Russian natural gas and oil is passed to Europe makes the outcome of the conflict important to recovery. The authors predict the U.S. could soon become one of the world’s biggest exporters of natural gas, but the country is not in a position to help Europe with its energy woes through the coming winter.

Gross recently released his first investment outlook since joining Janus and addressed why he left PIMCO, noting, “slowly and with great hesitation, I came to understand that it was time for me to leave. It happens sometimes to founders!”

As for the markets, he says there is “a new financial era. Accept it and modify your behavior accordingly, so that your future is safe, secure, and you look forward to a brighter tomorrow.”

The problem is financial markets are artificially priced, according to Gross, and now that we’ve had our feast years, we’re due a famine “almost by mathematical necessity.” He predicted bonds could reach 3% or 4%—“at best”—with stocks at 5% or 6%.

In a webcast with Weil, the fixed-income guru said monetary authorities have done a “decent job” of keeping interest rates down for a long period of time so that “financial markets didn’t implode” and so stock prices can rise.

Gross believes the Fed will slowly raise the rate to around 2%, in which case equity prices, cap rates and bond prices will be “decently supported, meaning in plain English there are no significant bear markets.” The caveat to that is that even if we don’t have a significant bear market, rates will stay low for some time.

He recommends an unconstrained strategy for investment professionals: Take “your best ideas within the context of a low duration/short maturity portfolio and try to help investors achieve what they consider to be an acceptable return. Watch the fees as well.”

Investors in such a strategy can expect a shorter average maturity for bonds, an ability to profit from currency movements and exposure to structured alpha, he wrote.