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By Eric Jacobson | 12-22-2009 02:18 PM

Gross: It's Been a Fixed-Income Decade

The PIMCO co-CIO and manager on guiding the Total Return Fund through the last 10 years, and how he's positioning it today, including a move into German bunds.

Securities mentioned in this video
PTTRX PIMCO Total Return Instl

Eric Jacobson: Hi, I'm Eric Jacobson with Morningstar. I'm a director of fixed income research. I'm here today with Bill Gross. Bill is the co-CIO at PIMCO, and he's also the manager of PIMCO Total Return. In fact, he's also nominated for the 2009/2010 fund manager of the decade.

Bill, thanks very much for joining us today.

Bill Gross: Thank you, Eric, for coming this far at this time.

Jacobson: It's good to see you.

The decade, let's talk about that for a second. A lot has gone on, a lot has changed. How has managing a fund like PIMCO Total Return--which as we all know is a very large fund. How has that evolved over time and what has it meant for the way you manage it?

Gross: Well, it's certainly gotten larger. In my office I have a copy of the day three years ago when Total Return turned $100 billion. I've got a new copy of the day that it turned $200 billion. So in three years, doubled the size, $100 billion on top of $100 billion. So it's been significant.

Actually the decade has been one in which funds have seen their glory, out-performing stocks in terms of total return, depending upon your category, I suppose. But it's been pretty much of a fixed income decade from the standpoint of interest rates coming down and many of the positive aspects of bonds, the higher income, et cetera, moving to the bottom line.

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