Bill Gross raised the holdings of Treasuries held in his $289 billion flagship fund at Pacific Investment Management Co. to 33 percent of assets last month, the highest level since July.
Gross boosted the proportion of U.S. government securities in Pimco’s Total Return Fund from 28 percent in February, according to a report on the company’s website. Gross has been advising investors to buy government debt, including inflation-linked securities and nominal Treasuries as the Bank of Japan last week became the latest central bank to announce unprecedented stimulus measures.
The world’s biggest manager of bond funds cut mortgage holdings to 33 percent in March, the lowest level since August 2011, from 36 percent in February. Newport Beach, California-based Pimco doesn’t comment directly on monthly changes in its portfolio holdings.
The fund kept holdings of non-U.S. developed nations’ debt at 11 percent last month. Investment-grade credit holdings were also steady at 9 percent.
The BOJ plans to buy 7.5 trillion yen ($76 billion) of bonds a month and double the monetary base, which includes cash in circulation, in two years, the central bank said April 4.
Gross, who manages the world’s biggest bond fund, said last week that Japan’s unprecedented purchase program, may force investors into other higher-yielding securities outside of the country, including U.S. Treasuries.
Treasuries may be “ridiculously priced and under-yielding,” Gross said in a Bloomberg Television interview April 4. “For the moment they have decent value relative to some of the other alternatives.”
Gross kept the fund’s emerging-market debt at 7 percent and municipal-bonds holding at 5 percent. He cut the Total Return Fund’s net cash-and-equivalent position to negative 3 percent, from negative 1 percent the previous month.
The fund returned 8.4 percent over the past year, beating 92 percent of its peers, according to data compiled by Bloomberg.
The Total Return Fund’s government and Treasury debt category includes fund holdings of U.S. Treasury notes, bonds, futures and inflation-protected securities.
Pimco, a unit of the Munich-based insurer Allianz SE, managed $2 trillion in assets as of Dec. 31.