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Bond Fund PIMCO May Lose 'World's Largest' Title

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Bond Fund PIMCO May Lose 'World's Largest' Title

The title of world's largest bond mutual fund could soon be changing hands, according to a report Friday.

Current title-holder Pacific Investment Management Co.'s Total Return Fund (MUTF:PTTRX) is teetering, with withdrawals of $7.3 billion in March, The Wall Street Journal reported.

That leaves the PIMCO fund with $117.4 billion, while Vanguard's Total Bond Market Index Fund (MUTF: VBMFX) held assets of $116.4 billion, excluding an ETF share class.

Vanguard "will have to wait at least another month before it can claim the world's largest bond mutual fund," according to the report.

PIMCO, a unit of Allianz SE (OTC: AZSEY), may have seen its fortunes turn with the departure of star manager Bill Gross to Janus Capital Group Inc (NYSE: JNS) in September.

Related Link: 3 Things To Know From Bill Gross' March Investment Outlook

Vanguard is benefiting from an increasing preference among investors for index-based funds over those that are actively managed.

So-called passive funds have seen a consistent inflow of funds since 2004, according to Morningstar's John Rekenthaler.

Vanguard has "developed a reputation as a fund manager that takes unusually good care of its shareholders," Rekenthaler said Thursday.

But Rekenthaler added, "Somebody who fully trusts a fund-industry leader is somebody waiting to be fleeced."

Posted-In: Bill Gross John Rekenthaler morningstarAnalyst Color News Bonds Markets Analyst Ratings Best of Benzinga

 

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