Pacific Life Insurance Co., the insurer where Pimco was started as a bond unit in 1971, is moving money from Bill Gross's old firm to Janus Capital Group, which the bond legend joined last month.
Pacific Life Insurance Co., the insurer where Pacific Investment Management Co. was started as a bond unit in 1971, is moving money from Bill Gross's old firm to Janus Capital Group Inc., which the bond legend joined last month.
Pacific Life asked the Securities and Exchange Commission for permission to move some separate accounts to the Janus Aspen Series Balanced Portfolio from the Pimco Global Multi-Asset Managed Allocation Portfolio, according to a filing today. The firm didn't give a reason for the move. The Pimco accounts weren't run by Mr. Gross and he isn't named as manager of the Janus Aspen Series Balanced fund.
Investors rattled by Mr. Gross's surprise departure are taking their money from Pimco, pulling a record $23.5 billion in September from the Total Return Fund (PTTAX), the world's biggest bond fund that Mr. Gross, 70, ran until his exit on Sept. 26. They're moving money to competing funds, or parking money in money-market funds and exchange-traded funds while they re-evaluate their holdings.
Marisa Schaeffer, a spokeswoman for Pacific Life, and Steven Shapiro, a spokesman for Janus with Communications Strategy Group, didn't immediately provide comment. Mark Porterfield, a spokesman for Pimco, declined to comment.
After Dec. 1, Pacific Life won't accept new allocation instructions to the Pimco portfolio, according to today's filing. The substitution will occur on or about March 6.
PACIFIC LIFE
Pacific Investment Management Co., which oversees $1.87 trillion, was started as a unit of the insurer previously known as Pacific Mutual Life Insurance Co.
In 1994, Pimco and four other asset managers owned by Pacific Life did a reverse merger with Thomson Advisory Group, in which a closely held company acquires a public company. The combined entity, Pimco Advisors, eventually became publicly traded, a run which ended when Allianz SE completed its acquisition of the money manager in 2000.
Mr. Gross, whose main fund at Pimco trailed peers since the beginning of 2013, left after his deputies threatened to quit and management debated his ouster, according to people familiar with the matter.
The $1.15 billion Pimco Global Multi-Asset Fund (PGAIX), run by Vineer Bhansali, Curtis Mewbourne, and Mihir Worah, has returned 3.2% this year, outperforming 89% of comparable funds, after losing 8.4% in 2013, according to data compiled by Bloomberg. The fund has lost 5.2% this month, dropping to the 18th percentile against peers.
The fund, which Gross has never run, was at various times managed by former chief executive Mohamed A. El-Erian and Saumil Parikh, who runs the firm's cyclical economic forums, was added as a manager. The team shifted in January after Mr. El-Erian announced his resignation from Pimco.
Pacific Life is putting money instead into an asset-allocation strategy led by Janus' Gibson Smith and Marc Pinto. The $1.6 billion Janus Aspen Series-Balanced Portfolio mutual fund has advanced 3% this year, beating 87% of peers. The fund surged 20% in 2013, beating 80% of competitors, according to data compiled by Bloomberg.
Gross's Janus Global Unconstrained Bond Fund (JUCIX), which started in May, has lost 0.3%t in the past month, outperforming 27 percent of peers, according to data compiled by Bloomberg. The fund received $66.4 million in September, according to Morningstar Inc., and had about $80 million under management at the end of September, the data show.
The market has anticipated that $25 billion to $50 billion in new assets will flow to Janus as a result of Mr. Gross' signing on, but that may be “setting up for possible disappointment,” Citigroup Inc.'s William Katz wrote in a report to clients Oct. 3.
