Tuesday, January 25, 2011

4th Largest Holder of US Treasuries? PIMCO

I have to admit that I have been startled by these articles on Bill Gross and his boast of home phone calls from the US Treasury Secretary--what I would call “inside information” (apparently perfectly legal in bond management).

http://www.nytimes.com/2009/06/21/business/21gross.html?_r=1&pagewanted=all

http://www.theglobeandmail.com/report-on-business/managing/the-lunch/the-obsessive-life-of-bond-guru-bill-gross/article1769691/

This is even more concerning given PIMCO’s huge holdings in US Treasury bonds, which it appears they intentionally try not to aggregate for public consumption.  I tried to compile the numbers on total holdings, and my best estimate based on mutual fund holdings is $180 billion and over $250 billion applying the allocation to other managed accounts.  It looks something like this.

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And then strangely enough, when we examine outperformance of PIMCO Total Return Fund over the Barclays Aggregate, something stands out slightly

image

I certainly don’t know what happened, but I like to point out odd things that go unquestioned especially when they deal with $1/4 Trillion of US Treasuries.  Please let me know if you have any insight.

 

2.5 hours

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