Trading Places: PIMCO Short-Duration Bond ETF Tops Gross as Largest Active Fund

ETF Trends

In another sign that investors are getting nervous about rising interest rates, a short-duration bond ETF at PIMCO has grown larger than a fund managed by Bill Gross.

PIMCO Enhanced Short Maturity ETF (MINT) now holds assets of about $4.1 billion, compared with roughly $4 billion for PIMCO Total Return ETF (BOND), which is skippered by Gross.

BOND is the ETF version of PIMCO Total Return Fund, the world’s largest mutual fund. [PIMCO Total Return ETF Provides Low-Cost Access to Bill Gross]

MINT is an ultrashort bond ETF that some investors use as an alternative to money market funds. [Short-Duration ETFs]

MINT has replaced BOND as the largest actively managed ETF.

Since long-term rates began to rise in May, investors have pulled out $858 million from the Total Return ETF and added $1.4 billion to the Enhanced Short Maturity ETF, reports Jason Kephart for Investment News.

“With massively rising interest rates, even a good bond manager is going to have trouble creating positive performance in this environment,” said Timothy Strauts, an analyst at Morningstar, in the article.

The opinions and forecasts expressed herein are solely those of John Spence, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.

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