Troubles at PIMCO

[FUEGO]

I thought PIMCO, like any managed fund would be spinning off the interest and capital gains each year as you go along so there should not be a major tax hit for this? How could this result in a major tax hit when you sell? I thought the deferral of taxes was a benefit of index funds and the tax hit hen you sell was their downside, not managed funds. I would think the 25- 30% excess return Gross was providing versus the benchmark index over the last 10-15 years would have paid all taxes due and resulted in a large post tax position.

Now that you mention it, you're probably right regarding most PIMCO funds (are all of them bond funds?). Bond funds don't tend to have a lot of capital appreciation over time like equity funds do. Most gains from bonds are interest payments. So maybe my fears of high cap gains coming due aren't as warranted for PIMCO given they manage mostly bond funds (on an AUM basis).

Otherwise, many actively managed equities funds do appreciate over time, only spitting out some of the gains in the form of CG distributions and dividends.

 

[Bikerdude]

I think he rode the bond bull for all it was worth. Now, not so easy.

 

[Brat]

This, IMHO, really gets back to the issue of what to do when you have a stellar fund that implodes for reasons other than market sector. I have OAKIX which has been stellar until recently and wonder why I am standing put.

 

[BUM]

Sounds like Gross is going to a competitor to try to hurt his previous employer. You'd think he'd have a non-compete clause in his contract?

Still wanting to prove something at 70 ...

Definitely not FIRE material. He'll probably die at his desk...

 

[FIREd]

I sold half of our PIMCO Total Return stake in DW's Fidelity 401K. She signed up for Brokeragelink and the money will be going to a plain total bond index ETF. The PIMCO fund's high expenses were arguably justified by Gross' superior record over the years, but not anymore, especially in this low yield environment. I am still pondering what to do with the second half. A TIPS fund maybe.

 

[REWahoo]

I am still pondering what to do with the second half. A TIPS fund maybe.

Only a few weeks until PenFed usually rolls out their annual "CD Special". Worth waiting to see what they do this year?

 

[FIREd]

Only a few weeks until PenFed usually rolls out their annual "CD Special". Worth waiting to see what they do this year?

I think that I only have access to brokered CDs with Brokeragelink (inside a 401K). I do have some cash stashed up elsewhere to take advantage of any Penfed CD special however.

 

[explanade]

Gross calls for fiscal stimulus.

Grounded in sand, Bill Gross calls for fiscal stimulus - MarketWatch

Says monetary stimulus hasn't been enough. Didn't he criticize QE?

 

[brewer12345]

More importantly, when will he finally STFU?