The Bond King Has a Very Bad Day

Today the Wall Street Journal ran an article about the country’s most prominent bond investor, Bill Gross. Mr. Gross was nicknamed the “Bond King” because he co-founded Pacific Investment Management Company (“PIMCO”), one of the world’s largest asset managers, and he ran their most famous fund, the Total Return Fund, for decades.

Mr. Gross left PIMCO in 2014 and now manages the Global Unconstrained Bond Fund at Janus Henderson.

That fund has struggled mightily. In part due to unsuccessful bets that Italian bonds would appreciate, the fund lost 3% of its value yesterday and is down almost 6% year-to-date. Peer bond funds are about break-even.

Are investors in Mr. Gross’s fund getting value for the 0.98% expense ratio they are being charged? Investors who know of Mr. Gross’s expertise would have thought so; but they also weren’t expecting to lose their money.

For WSJ subscribers, the article can be found here: Bill Gross’s Janus Unconstrained Bond Fund Drops Sharply