Bill Gross sent ripples through the bond and equity markets this morning with his announcement that he’s leaving Pimco and joining Janus Capital Group Inc (NYSE:JNS). But it seems that he’s been looking for a new job for quite some time.
Gross, Pimco execs at odds
This morning there are reports that he had been fighting with the company’s executive committee and that he had been threatening to leave for some time. And now CNBC reports that that Bill Gross had even been talking with Jeffrey Gundlach about going to DoubleLine Capital instead of Janus.
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Apparently the contention at Pimco was so bad that five executives at the Allianz SE (ETR:ALV)-run found had said they would depart if Gross stayed. In fact, CNBC even reports that Pimco was preparing to fire Bill Gross on Saturday for what the network called “increasingly erratic behavior.”
Gross, the “Bond King”
In spite of the recently announced investigation into Gross and one of the exchange-traded funds he was managing for Pimco, the so-called “Bond King” remains well-respected in the industry. Allianz maintains that there isn’t any sign that Gross is leaving because of the Securities and Exchange Commission’s investigation.
Other well-known investors are now weighing in on Gross’ defection to Janus. Reuters is reporting that Jeffrey Gundlach himself said he thinks Gross will do better at Janus than he has done recently at Pimco. The DoubleLine Capital chief said it’s because he “isn’t managing a lot of money.” Janus has less than $180 billion in assets under management, compared to Pimco’s $1.97 trillion in assets under management.
Vanguard’s Jack Bogle told CNBC that he was shocked when he heard about Gross’ departure and that he doesn’t shock easily. He thinks it’s “too bad for Pimco.”
Janus looks to Bill Gross for recovery
Ariel Investments portfolio manager John Miller called Gross’ movement to Janus “a black swan event.” Ariel is one of Janus’ top investors. He believes Bill Gross will help Janus Capital regain its former glory. The firm’s equity funds crashed hard when technology stocks crashed and then again when the financial crisis hit. Janus has yet to recover from those setbacks and has sustained outflows over the last several years.
Miller called Gross “one of the best investors of all time” and said that for him to move to “a firm like Janus,” it “says a lot about the brand.”