Why does anyone listen to Bill Gross?

Discussion in 'Trading' started by Cutten, Dec 2, 2008.

  1. Has he actually made investors any more money than an index fund tracking his benchmark? He called for Dow 5000 in 2002, right before it doubled in 5 years. Is there any reason anyone should actually listen to his market pronouncements?
     
  2. He makes for a good "contrary" indicator because he carries a lot of influence in the bond market. :cool:
     
  3. Maverick74

    Maverick74

    Since 1977, he has returned about 11% a year net to his investors. That's a 30 year period. Not bad for fixed income with almost zero volatility. Oh, and he manages about 800 billion. I would say he is the best fixed income trader in the world, and probably ever.
     
  4. Damned if I know.

    Bill Gross is the Chief Investment Officier of PIMCO and under his watch a number of PIMCO funds such as PFL, PFN, PHK have been run right into the ground. You would think that such a fixed income expert would have been giving advice to all PIMCO funds on how to make money rather than lose large percentages of their assets.
     
  5. Daal

    Daal

    this is all true. I make fun of him frequently here but he is one of whose opinion I respect. If you read mcculey and his articles back many years they seem to be ahead of the events over and over again
     
  6. Do you have a source for the long-term figures? I see his 10 year record is about 6.5% (not including this year), which is less than you would have made by purchasing 10 year Treasuries 10 years ago and holding to maturity, and presumably had more risk.

    I wouldn't rate his assets under management - Fidelity has more and their performance sucks. An investor does not make money if their fund manager manages more assets (usually the reverse, in fact, as performance drops).
     
  7. Maverick74

    Maverick74

    Here is what I found. I was off a little.

    "From Pimco's trading floor in Newport Beach, 3,000 miles from Wall Street, Gross, 60, manages the world's biggest bond fund. His Pimco Total Return Fund has gained an average of 9.4 percent a year since its inception in 1987, beating the 8.1 percent average return posted by the benchmark Lehman Brothers U.S. Aggregate Bond Index."

    http://www.bloomberg.com/apps/news?pid=nifea&&sid=aYeg_aUhO2vc

    I only mention the 800 billion because I'm sure sometime in the next hour some piker will come on here and say he made 10% today alone in his account. Making 10% a year on 800 billion is not the same as making 10% on a 10k IB account.

    But I do agree with you regarding assets and performance which quite frankly makes his numbers look even more impressive.

    I'm sure if he was managing 100 million he could have done twice those numbers.
     
  8. He is a damn good investor, no doubt about it, but he also talks his book and has no qualms about taking bonds higher so he can get out. He seems to call the inverse to tops and bottoms very well. If he's on CNBC talking about buying bonds, I'd fade it and get short 'cause he's talking the market up so he can sell into it.

    No one has a better command on where rates are going. PIMCO leads the FED and can force the FEDs hand.
     
  9. He said this:



    “More regulation, lower leverage, higher taxes and a lack of entrepreneurial testosterone are what we must get used to -- that and a government checkbook that allows for healing, but crowds the private sector into an awkward and less productive corner,” Gross wrote in his commentary.

    Um yea except none of that has actually happened and never will. There is no evidence that there is more regulation. Taxes will not go up under Obama The bush tax cuts will continue. He is full of it.
     
  10. Oh, yeah Bill Gross is a damn good investor. Look at what he does with his own money.

    Bill Gross owns 2,006,500 shares of the PIMCO fund PTY since August 2007. 52 week range is from 15.80 to 6.51. At current price of 7.68 Bill Gross has lost over $15 million of his own money in just this one quality PIMCO fund.
     
    #10     Dec 2, 2008