Pimco Total Return loses title as world's biggest bond mutual fund

London

THE Pimco Total Return Fund, launched by Bill Gross, has lost its title as the world's biggest bond mutual fund, following two years of withdrawals.

On Monday, Pacific Investment Management Inc said investors yanked another US$5.6 billion from its flagship Pimco Total Return Fund last month, bringing its assets to US$110.4 billion at the end of April. Cash withdrawals in April marked the fund's 24th consecutive month of net outflows.

By comparison, the Vanguard Total Bond Market Index Fund had US$117.3 billion as of April 30, according to a Vanguard spokesman. "We do not view this as an asset gathering horse race," said John S Woerth, spokesman at the Valley Forge, Pennsylvania-based Vanguard Group. "It is, however, representative of the popularity of low-cost, broadly diversified index funds."

The Pimco Total Return Fund hit a peak of US$292.9 billion in assets under management in April 2013. It delivered a net after fee return of 1.62 per cent year-to-date through April, outperforming its benchmark by 38 basis points, Pimco said.

Pimco has seen about US$130 billion of net withdrawals from its open-ended funds since Mr Gross's departure last September, even as performance has improved. REUTERS