The asset drain at Pacific Investment Management Co (PIMCO) continues.
The bond giant said on Tuesday that investors withdrew US$27.5 billion from its flagship Total Return fund last month, shrinking the size of the world’s largest bond fund to US$171 billion.
In its release, PIMCO was quick to point out that nearly half of the sum was removed in the five days following the departure of manager Bill Gross.
Nevertheless the size of the monthly outflow underscores the challenge PIMCO faces to persuade investors to stick with the company following months of management turmoil and — in the case of Total Return — middling performance.
To date, Total Return trails 79 percent of its peers, according to Morningstar.
PIMCO executives say they accept that until these figures show marked improvement, the outflow is likely to continue.
And while it is true that PIMCO Total Return remains the world’s largest bond fund, the once yawning gap between itself and its peers is narrowing.
For example, fast-growing investment firm Doubleline said this week that its own total return vehicle had attracted US$1.8 billion in assets last month, bringing the fund’s size to US$38 billion.
That is still quite a distance from US$171 billion, but the trend is clear enough, and at this size, PIMCO’s total return fund is at its lowest level since July 2009.
Like many bond funds, PIMCO is betting that growth at home and abroad will remain stagnant and that central banks will keep interest rates low and print money to buy bonds. In such an environment, PIMCO managers have said that higher yielding assets such as emerging markets and mortgage securities in the US will be winning investments.
PIMCO’s exchange-traded fund has also had sharp outflows of late, losing US$1 billion since Gross left.
And while half of this amount came after he left, the withdrawals have continued since then with one of the largest daily outflows — US$51 million — on Friday.
Taiwan’s foreign exchange reserves fell below the US$600 billion mark at the end of last month, with the central bank reporting a total of US$596.89 billion — a decline of US$8.6 billion from February — ending a three-month streak of increases. The central bank attributed the drop to a combination of factors such as outflows by foreign institutional investors, currency fluctuations and its own market interventions. “The large-scale outflows disrupted the balance of supply and demand in the foreign exchange market, prompting the central bank to intervene repeatedly by selling US dollars to stabilize the local currency,” Department of Foreign
ENERGY ISSUES: The TSIA urged the government to increase natural gas and helium reserves to reduce the impact of the Middle East war on semiconductor supply stability Chip testing and packaging service provider ASE Technology Holding Co (日月光投控) yesterday said it planned to invest more than NT$100 billion (US$3.15 billion) in building a new advanced chip testing facility in Kaohsiung to keep up with customer demand driven by the artificial intelligence (AI) boom. That would be included in the company’s capital expenditure budget next year, ASE said. There is also room to raise this year’s capital spending budget from a record-high US$7 billion estimated three months ago, it added. ASE would have six factories under construction this year, another record-breaking number, ASE chief operating officer Tien Wu
Intel Corp is joining Elon Musk’s long-shot effort to develop semiconductors for Tesla Inc, Space Exploration Technologies Corp and xAI, marking a surprising twist in the chipmaker’s comeback bid. Intel would help the Terafab project “refactor” the technology in a chip factory, the company said on Tuesday in a post on X, Musk’s social media platform. That is a stage in the development process that typically helps make chips more powerful or reliable. The chipmaker’s shares jumped 4.2 percent to US$52.91 in New York trading on Tuesday. The Terafab project is a grand plan by Musk to eventually manufacture his own chips for
For weeks now, the global tech industry has been waiting for a major artificial intelligence (AI) launch from DeepSeek (深度求索), seen as a benchmark for China’s progress in the fast-moving field. More than a year has passed since the start-up put Chinese AI on the map in early last year with a low-cost chatbot that performed at a similar level to US rivals. However, despite reports and rumors about its imminent release, DeepSeek’s next-generation “V4” model is nowhere in sight. Speculation is also swirling over the geopolitical implications of which computer chips were chosen to train and power the new
RSS