Fund performance

The client redemptions that plagued Bill Gross at his old job have followed him to his new one as well. Gross’s Janus Global Unconstrained Bond Fund suffered its first month of net withdrawals since he joined, with clients pulling $18.5 million from the fund in February, Morningstar estimated.

This week's items of note includes a Fed warning on potential misperceptions of liquidity with ETFs, a report on clients defecting at an unprecedented rate from Pimco's developing-nation mutual funds, a study showing underlying investment fees have declined at small retirement plans, and exchange operator BATS naming a new CEO.

For many bond managers, equities seemed like a great idea after the 2008 financial crisis. The Federal Reserve had pushed interest rates to near-zero, potentially leaving little room for bonds to appreciate and fueling a rally in stock markets that’s about to enter its seventh year.

Investors are pouring a record amount of money into ETFs that focus on municipal debt even as the consensus on Wall Street calls for higher interest rates in coming months.

Ballentine's clients invest in the U.S. equities market via ETFs. When the market was near its bottom, Ballentine had them sell those funds and buy into "like kind" ETFs, which they then rode back up.

Redemptions at Pimco's biggest mutual fund slowed to the lowest since Bill Gross left the firm, as performance rebounded.

Up to 10% of some corporate-debt funds’ holdings now consist of ETFs, a proportion that’s been rising for the past two years, research shows. Also, ETFs are also being used as an easy way to invest in bonds after receiving large inflows.

Bill Gross says he’ll keep trading for the next two to four years to prove he can still beat the market.

The strong launch of an ETF with Jeffrey Gundlach's name behind it demonstrates there is room for more growth in actively managed ETFs, industry observers say.

BlackRock, the world’s largest money manager, cut fees on five bond exchange-traded funds, joining rivals in lowering costs to attract more investors.

Pimco is seeing unprecedented client defections from its developing-nation mutual funds as poorly timed investments and below-average returns catch up with the firm. Customers have pulled about $10 billion since the start of 2013, according to data from the fund manager.

Taking a simple approach hasn't hindered performance at Neil Hennessy's firm, which reported $5.9 billion in assets under management at the end of 2014, a 33% increase from the previous year. In the first part of a conversation with Money Management Executive, Hennessy discussed his firm's approach and why it shuns some market trends.

The SPDR DoubleLine Total Return Tactical exchange-traded fund launches today. It will be managed by Jeffrey Gundlach, who also runs the DoubleLine Total Return Bond Fund, a top-performing mutual fund. It is the 26th ETF to be launched this year, but it is possibly the most important as a test of whether active management can ever thrive inside the ETF industry.

Bill Gross’s $1.46 billion Janus Global Unconstrained Bond Fund trailed its benchmark in the fourth quarter of last year primarily because it had plowed about 5% of net assets into debt issued by U.S., Russian and Brazilian energy companies.

McCulley’s exit further reduces the ranks of Gross loyalists in the wake of his abrupt departure Sept. 26 to manage a small fund at Janus Capital Group Inc. Pimco’s new management and investment team are seeking to reassure clients after a year of record redemptions and co-chief investment officers Gross and Mohamed El-Erian left.

Mutual funds that buy loans saw $4 billion yanked last month, bringing total outflows for the 12 months ended Jan. 31 $28.7 billion, according to Morningstar data. That’s the biggest withdrawal for any U.S. debt asset class in the period.

Municipal bond sales in the U.S. are set to decrease in the next month while the amount of redemptions and maturing debt falls.

This past week, the industry saw Pimco suffer more redemptions despite the climbing performance of its Total Return Fund, a BlackRock bond ETF receiving a record $2 billion deposit, Virtus Investment Partners announced an agreement to acquire a majority interest in ETF Issuer Solutions, and a report from Cerulli Associates noting that socially responsible investing has become a frequent request of asset managers from institutional clients.

Fidelity Investments, the second-largest U.S. mutual fund company, reported a 29% increase in operating income in 2014, as growth in its retirement business and cost cutting helped offset withdrawals from its actively managed offerings.

Ballentine Partners is a wealth management firm with roots in an unusual institution: a summer camp.