Bill Gross’ departure from Pimco

Legendary bond investor Bill Gross is leaving Pacific Investment Management Co. the Newport Beach firm he cofounded, to join Janus Capital Group Inc. and manage a recently launched global bond fund, the company said Friday. Here is a collection of stories by Los Angeles Times.

Legendary bond investor Bill Gross is leaving Pacific Investment Management Co. the Newport Beach firm he cofounded, to join Janus Capital Group Inc. and manage a recently launched global bond fund, the company said Friday. Here is a collection of stories by Los Angeles Times.

To be honest, I dont think it will have an immediate impact, said Christopher Schwarz, an associate professor of finance at the Paul Merage School of Business at UC Irvine. Generally speaking, once youre in a fund you almost never leave, unless something incredible happens.

I dont think many people know what specific mutual fund they have in their 401(k), let alone who the manager is, said Todd Rosenbluth, director of ETF & Mutual Fund Research for S&P Capital IQ. As long as the institutional investor community leaves the fund in the lineup, then money will not as quickly depart.

The Total Return Fund the worlds largest bond fund has stumbled in the last five years, with nearly $70 billion in outflows in the last 16 months, analysts said. And that trend is likely to continue.

Some investors, initially drawn by the Gross brand name, may leave, said Brad Stark, co-founder of Mission Wealth in Santa Barbara. But those movements will be slow.

While some people will possibly look to move money from Pimco, not all will and not all at once, said Stark, whose firm has roughly $10 million of $1 billion under management with Pimco.

And skittish institutional investors would have trouble finding a replacement as large as the Total Return Fund, where Gross managed more than $200 billion in assets, Schwarz said. At Janus, which has $34 billion in total assets in all of its fixed income funds, Gross will run a much smaller $12.9-million fund.

Those institutions have to have somewhere else to go its not like they can pull $100 million out of Total Return and just send it over to Janus, Schwarz said. Some might get nervous and move, but it really depends on how much they believe Bill Gross is responsible for the performance of the fund.

Gross, 70, resigned over fundamental differences about the direction of the Newport Beach company, according to a curt statement from Pimco Chief Executive Douglas Hodge.

Late Thursday, Pimco said it had named Daniel Ivascyn one of six deputy investment chiefs to succeed Gross as chief investment officer for all Pimco funds. Ivascyns $38-billion Pimco Income Fund has beaten 99% of its rivals over the last five years.

Three of Ivascyns fellow deputies — Mihir Worah, Mark Kiesel and Scott Mather — will take over managing the Total Return Fund, Pimco said in a news release.