I have written before that "go anywhere" or "unconstrained" bond funds are essetially bets on the "genius" manager. Bill Gross once manager of the (then) world's largest bond fund Pimco Total Return Fund ran into a period of poor returns which (predicatbly) let to outflows from the fund and his subsequent departure from the firm.
He landed at Janus Capital with a new fund. And he continued his style of making many bold statements which seemed to indicate how he was positioning his fund.
In April with the yield on 10 Year German Government Bonds (BUNDS) trading at the rock bottom yield of .10% Gross tweeted and spread the word all over the media that going short Bunds was the trade of a lifetime". Such a short would profit from a rise in German rates (fall in price). Sure enought rates on the bonds rose to .64% over the next month.
Following those pronouncements by Gross investors in his Janus Global Unconstrained Bond Fund would likely have been expecting the fund to rack up some nice gains as a "short position in the Bunds would have been quite profitable.
It didnt turn out that way. As Bloomberg reports
|10 Year German Government Bond (Bund) Yield|