Does the current QE3 program help PTTRX in any way? If QE3 is all about the Feds buying bonds, I would think it would keep PTTRX stabalized. Yet some are saying Bonds could crash if the fiscal cliff isn't resolved. Any opinions?
Part of the QE3 is to buy mortgage backed securities (MBS) to the tune of about $40B a month. Mr. Gross has PTTRX well positioned here, and should prove profitable going foward. With that being said, returns here will probably not be as good in the next couple of years as it has been in the last few. I would guess that PTTRX will deliver between 4 and 7 percent.
The fiscal cliff is a political circus. It will resolve the same as it ever was. And QE3 is an example that politicians will do anything to avoid anarchy. PTTRX seems to be the right place to avoid the haircuts.