Jan. 8 - Bill’s Gross’s Total Return Fund is way too big to succeed according to Steven Goldberg from Tweddell Goldberg Investment Management
Bill Gross is gigantic Pimco total return fund bounced back from a horrible 2011 to return more than 10% last year. But it -- advisors Steve Goldberg partner put down Goldberg investment management says it's time to sell the world's largest bond fund. -- -- Total return placed in the top 1% of its class last year -- more than double its benchmark so -- Why sell -- I mean besides Bill Gross the blocking and you've gotten. As well who is settling -- stupid and it's not like he doesn't have a lot of Smart people working with them. It does but the problem is he's got a portfolio now 20000. Securities. So to me and to my mind he's like us are very good boxer. Fighting with one hand behind his back. And what that means is he can't win by picking sheet he can't say he can't. Spend time looking inside their company looking inside finance and insane. Boy this is a really good bond and way under appreciated by the market I wanted to -- ahead. The only thing he can do is get the macro rank and that big picture right. -- -- -- -- -- -- -- -- Size plus one problem bond -- since March much bigger and it prices are less sensitive to big mauling training. And I don't think he never got up stuff on this approached. 30400. Billion dollars and assets I think that I mean when do when. When Peter Lynch was managing I think it's timeless. Twenty billion dollars I mean their funds that have been a hundred billion even close to 200 billion before they lacked. On the stock side. But on the ball and I don't think there's ever been found his biggest and so. Yeah isn't the -- relatively nimble and properly positioned given aggressive shortened his duration. Well because shortest duration you can go to the futures market and do that there anytime minutes anytime of the day or night. But oh what he can't do is pick the good undervalued bonds like profound like Matt Weston constrained -- total return. Or a whole bunch of double line total return to do that. Lots on his own little -- loans -- -- diversified incumbents when my favorite. And now controlling congress -- -- to these are on the twenty million dollar range. And they can pick that really good superb it's just like and stuff land. Was -- an additional point you made about size. You also make a point article that perhaps this time the thirty year bond rally is over what makes you so sure that this time it is over because this time last year we heard the same arguments. And the bonds still rally. Yeah -- thirty years a long time for a bull market and bombs it's it's pretty close to the end and at this point you're gonna have to be. Really nimble. To salute to mattress you're gonna have to make money and some of these smaller sectors. They go into junk bonds and you've got to pick up a really good jump on. You don't convertibles I think bill grosses. -- is bigger than. All the convertible securities that are available in the US so what would you recommend that investors pick up instead of the total return fund. I think everybody -- -- they're there to ration their to -- there's exposure to interest rates. Because everybody realizes rates can't go down so much. And in order to make money in the bond market you've got to look at some other areas the best -- I think -- are emerging markets. And and secondly I -- mortgages. Some of the prime mortgages is saying stuff follows the blow up and go away. The stuff some of its -- pretty shapes. Right thanks -- these are doing. Our existing Goldberg it would Al Goldberg investment management I'm Fred Katayama and this is really.