Spanish and Italian government bonds aren’t compelling investments and Pacific Investment Management Co. is cautious on the securities, according to Andrew Balls, head of European portfolio management at the firm.
“We are neutral-to-underweight on Italy and Spain,” Balls said at a media briefing in London today. “Our bias is to be quite cautious. We prefer looking at absolute value not relative value. Spain and Italy offer reasonable risk-reward but are not compelling.”
An underweight position means the fund holds fewer securities than the benchmark it uses to track performance.