Why some unconstrained bond funds are seeing investor outflows



Bill Gross leaves PIMCO and joins JUCIX

In this section, we’ll continue our look at some of the more prominent names in the non-traditional bond (BASIX) category:

  • PIMCO Unconstrained Bond Fund A (PUBAX)
  • Janus Unconstrained Bond Fund I (JUCIX)


Part 7

PIMCO Unconstrained Bond Fund A (PUBAX)

PUBAX numbers among the older and larger funds in the category. The fund launched in June 2008. Net assets were estimated at $18.7 billion as of September 30, 2014. The fund has returned 2.4% in the year to date.

Bill Gross’ exit from PIMCO: Impact on PUBAX

PUBAX experienced ~$10.9 billion in outflows in the 12 months to September 2014. These figures included withdrawals of ~$3.2 billion in September alone.

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Legendary bond investor Bill Gross left Pacific Investment Management Co. (or PIMCO) in September, causing investors to exit en masse from PIMCO-sponsored funds. Total outflows for all of PIMCO’s funds were estimated at $23.5 billion in September. These include $17.9 billion from PIMCO’s flagship PIMCO Total Return Fund (PTTRX).

In contrast, the SPDR S&P 500 ETF (SPY), the Vanguard Total Bond Market ETF (BND), and the Vanguard Total Stock Market ETF (VTI) reported respective net inflows of $9.8 billion, $3.9 billion, and $2.1 billion. The iShares Core S&P Mid-Cap ETF (IJH) and the Vanguard Total International Stock ETF (VXUS) had respective net inflows of $2.6 billion and $3.2 billion—this data, according to Morningstar.

Janus Global Unconstrained Bond Fund I (JUCIX)

Bill Gross is now managing Janus’ unconstrained bond fund, JUCIX. This is a very new fund, launched on May 27, 2014. Net assets totaled just ~$79 million at the end of September. The fund is targeted at institutional investors, and requires a minimum investment of $1 million. Fund returns in 2014 year to date were -0.95%.


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