Pimco Sees $19.4 Billion Withdrawn in December

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Pacific Investment Management Company
PIMCO's Logo
Pacific Investment Management Company
PIMCO’s Logo

Pimco, Pacific Investment Management Company, saw the highest redemption among all mutual funds in the United States in 2014. Big names, such as Bill Gross, left the company this year and undoubtedly, helped spur the rapid withdrawals that followed.

The swift drop of the stock market will certainly see many other investors withdrawing money to start the new year. This marks 20 straight months of redemptions for the company.

Figures from 2013 show that the mutual fund had assets of $293 billion dollars. Closing 2014, Pimco had its assets drop to $143.4 billion dollars. The Pimco Total Return Fund, in 2014 alone, had over $100 billion dollars in withdrawals; more than any other mutual fund this past year.

The loss of Gross has sparked major concern for the declining company. While many speculate that the company’s immense growth spurred its fast decline, it’s still ranked as the 4th largest mutual fund in the United States; once being the largest mutual fund in the country.

Data indicates that investors are leaving Pimco (and traditional mutual funds in general), and moving towards ETFs, or other non-traditional funds.

The sharp decline in the stock market to start off 2015 will play an interesting roll in redemptions for January. It’s expected that the company will see even more withdrawals in January than it did for the month of December.

How the company performs in the coming months will dictate its future. With major losses of Mohamed El-Erian followed by Bill Gross just nine months later, it’s no surprise that the company has seen an increase in withdrawals.

Analysts suggest that unless the company’s performance truly deteriorates in the coming months, stabilization will occur after a few more months of outflows.

The good news is that the December outflow of $19.4 billion is down from the October outflow of over $27.5 billion due to Gross’ departure from the company.

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