DENVER (AP) — William H. Gross, the famed and colorful bond investor who once controlled the world’s largest mutual fund, is closing his professional career of more than 40 years and retiring to focus on managing his personal assets and private charitable foundation.
Gross, 74, was nicknamed the “Bond King” after co-founding the investment firm Pimco in 1971 and delivering returns that were the envy of the fixed-income market. His predictions were closely followed by investors around the world as he made billions of dollars for investors of the Pimco Total Return mutual fund that he ran. But his star dimmed in recent years as his returns fell short of competitors.
Gross left Pimco for Janus in 2014 in a split that surprised investors, one that Gross has described as an internal power struggle. The Janus Henderson Global Unconstrained Bond fund that Gross now runs lost 3.9 percent last year, and it ranks in the bottom 6 percent of all nontraditional bond funds for returns over the last three years, according to Morningstar.
The investment strategy run by Gross has also fallen short of its benchmark, a three-month interest rate known as Libor, since late 2014. Recently, Gross’ performance was hurt by trades that would have benefited from weaker prices for German government bonds.
The struggles are a sharp turnaround from earlier in Gross’ career.