January 6, 2015 / 5:26 PM / 5 years ago

Pimco Total Return Fund saw record outflows in 2014: Morningstar

NEW YORK (Reuters) - The Pimco Total Return Fund had a record outflow in 2014, according to preliminary data from Morningstar on Tuesday, with Pimco’s U.S. open-end mutual funds also posting a record annual outflow.

The Total Return Fund saw outflows of $103 billion in 2014, according to the data.

Investors pulled $150 billion from Pimco’s US open-end mutual funds for 2014, a record annual withdrawal for any mutual fund company, the data showed.

Pimco reported on Friday that its flagship Total Return Fund posted a 20th straight month of outflows in December. Pimco reported outflows of $19.4 billion for the month for that fund.

The fund’s assets were $143.4 billion at the end of December, less than half the peak of nearly $293 billion hit in 2013, Pimco said Friday.

“Pimco Total Return has become a symbol of reduced interest in actively-managed funds,” said Todd Rosenbluth, director of mutual fund research at S&P Capital IQ.

“What we’ve seen is that investors are either leaving traditional mutual funds and going towards ETFs, or they’re staying within mutual funds and using nontraditional funds,” he said.

The Pimco Total Return exchange-traded fund saw outflows of $32 million in December, for total outflows of $1.2 billion in 2014, according to the Morningstar data.

A request for comment to Pimco on Tuesday was not immediately returned.

Management turmoil at Pimco spooked many investors last year, with then chief executive officer Mohamed El-Erian leaving in January amid reports of acrimony with firm co-founder Bill Gross.

In September, Gross himself shocked markets by leaving Pimco for smaller rival Janus Capital, which prompted a spike in outflows.

“The Bill Gross departure encouraged investors to rethink their investment exposure,” Rosenbluth said.

“There are few watershed moments in the mutual fund world that can even compare to the late September change,” he added.

Reporting by Luciana Lopez and Sam Forgione; Editing by Alden Bentley and Chizu Nomiyama

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