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Pimco May Have Averted Fire Sale After Gross’s Exit

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Pimco’s In-House Sale Limits Total Return Fund Loss

When Bill Gross stepped down from the Pimco Total Return Bond Fund in September, traders across Wall Street anticipated that the world’s biggest bond fund would be forced to dump holdings at fire-sale prices to meet record client withdrawals.

So why didn’t it happen? One explanation, according to a regulatory filing last month, may be that Pacific Investment Management Co. held the fund’s clearance sale in-house. The firm sold about $18 billion of Total Return’s assets to other Pimco funds and accounts between October and March, helping it meet more than $100 billion of redemptions that followed Gross’s surprise exit.