Pacific Investment Management Co.s Income Fund brought
in $2.7 billion from investors in July, making the bond giant
the most popular U.S. active manager last month, according to
data from fund tracker Morningstar.
Overall, the firm had $2.5 billion in net flows in July,
meaning the Income Fund even made up for some of the
The $92 billion PIMCO Income Fund, managed by a team that
includes chief investment officer Dan Ivascyn, has been a top performer of
late. In 2016, the fund returned 8.29 percent 5.64
percentage points more than its benchmark, the Bloomberg
Barclays U.S. Aggregate Bond index, and 0.77 percentage points
more than peers in its multi-sector bond fund category.
Year-to-date in 2017, the fund has delivered a 5.62 percent
return versus the benchmarks 2.71 percent return.
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For performance over the past five years, the PIMCO Income
Fund ranks No. 3 in its category, according to Morningstar. A
PIMCO spokeswoman says the firm doesnt provide details
about fund flows.
Earlier this year, the PIMCO Income fund became larger than
the PIMCO Total Return Fund, which has been losing assets since
co-founder Bill Gross left the firm in September 2014
for Janus Capital, now Janus Henderson, after months of
controversy and battles with fellow executives. PIMCO Total
Return now has $73.3 billion, almost $20 billion less than the
As for worries about whether the fund is becoming too large,
experts say it is helped by a global multi-sector mandate,
which allows managers to invest in a wide variety of asset
classes and regions of the world.
PIMCOs inflows come at a time when active managers
continue to experience few victories. Last month, investors
socked away $10.8 billion into U.S. equity index funds and
pulled $19.6 billion out of U.S. active equity funds, per
Taxable bond funds like PIMCOs Income Fund have also
been hit by the passive trend, but not as dramatically. With
many investors concerned about stock market valuations, the
taxable bond category was one of the most popular, bringing in
$34.7 billion overall in July, according to Morningstar.
The majority of flows into taxable bond funds still went to
index funds, but active funds gained a respectable $13.6
billion in July. The second-most-popular active fund shop
behind PIMCO was Vanguard, which is best known for its passive
funds and has been a major beneficiary of the shift from active
to passive. Vanguard, which brought $1.5 billion into its
actively managed funds last month, also had the highest net
flows into passive funds in July, taking in $20.1 billion.