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Four bond funds with less than $2 billion in
assets under management posted record monthly inflows in
October, according to Morningstar.
Topping the list is the $1.3 billion Mainstay Total Return Bond
Fund, which saw $264.6 million in new investor money in October.
The $960 million Metropolitan West Intermediate Bond Fund posted
$204.5 million in inflows while the $1.9 billion Lord Abbett
Total Return Fund posted $153.5 million in inflows.
The much lesser-known $636.6 million Sterling Capital Total
Return Bond Fund also saw record monthly inflows of $132.4
million in October.
While Metropolitan West Asset Management, a unit of TCW, is a
bond fund behemoth, the fact that the other three managers saw
such large inflows into these small funds shows how vast the
movement of money from Pimco to the other firms has been over
the past several weeks, said Todd Rosenbluth, director of mutual
fund research at S&P Capital IQ.
"Mr. Gross' departure from Pimco was a once-in-a-lifetime event
for bond funds," Rosenbluth said.
Since Gross, the co-founder of Pimco, abruptly resigned on
September 26, large bond fund managers like BlackRock, The
Vanguard Group and DoubleLine Funds have seen record monthly
inflows into their bond funds [ID:nL1N0SX0XT].
While the MainStay, Lord Abbett and Sterling funds have
outperformed their peers for the last one, three and five years,
the MetWest Fund has underperformed its peers for the last 12
months, as has the Pimco Total Return, according to Morningstar.
The one-year return for the MetWest fund is 2.88 percent,
compared with 3.72 percent for the Pimco fund. However the
MetWest fund outperformed the Pimco fund and its category for
the last three, five and 10-year periods, according to
Morningstar.
The funds' fees range from 60 basis points on the high-end for
institutional shares of the MainStay Fund to 44 basis points for
the MetWest Fund. Lord Abbett [ID: nL1N0SM120] and Sterling both
lowered their funds' fees in October.
TCW declined to comment. Mainstay and Pimco were not immediately
available for comment.
(Reporting by Jessica Toonkel; editing by Gunna Dickson)
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