Pimco Steals AIG’s Bond Fund Insurance Playbook

Pimco is putting all their chips on the table, betting that low interest rates, along with lower and more stable global growth, will last for the next 3 to 5 years; an economic condition it is referring to as the "new neutral".

In fact, the company is so convinced of this "sure thing", it’s placing a straight bet–selling insurance against price fluctuations on their $230bn flagship bond fund Pimco Total Return. That means it is offering investors price stability in the bond portfolio, in return for a premium.

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