Bill Gross Is Bullish on Municipal Bonds

 |  Includes: PCK, PCQ, PMF, PMX, PZC
by: George Spritzer, CFA

According to recent SEC filings, Bill Gross of Pimco invested about $4.4 Million of his personal family money in five Pimco municipal bond closed-end funds in just three days last week. There is a small time delay in SEC filings, and it is quite possible that Gross has continued to buy more this week.

PMX Pimco Municipal Income Fund III

PCQ Pimco California Municipal Income Fund

PCK Pimco California Muni Income Fund II

PZC Pimco California Muni Income Fund III

PMF Pimco Municipal Income Fund

If you look at the time and sales for these muni closed-end funds, you will find a large number of small lot trades, which normally means heavy retail participation. I wonder if the retail sellers or their brokers would have sold their shares if they knew that the buyer on the other side was Bill Gross.

Here is a list of the recent Bill Gross purchases from SEC Edgar:

Date Shares Price $ Invested
12/08/2010 12,096 PMX 9.75 $117,936.00
9,900 PCQ 11.65 $115,335.00
19,056 PCK 8.2741 $157,671.25
12/09/2010 36,225 PCQ 11.5997 $420,199.13
50,000 PCK 8.2465 $412,325.00
23,333 PMF 12.048 $281,115.98
42,864 PZC 8.65 $370,773.60

88,156 PMX 9.8493 $868,274.89
12/10/2010 19,168 PCQ 11.5743 $221,856.18
48,816 PCK 8.1387 $397,298.78
32,002 PMF 12.0397 $385,294.48
19,400 PZC 8.5211 $165,309.34
50,000 PMX 9.7494 $487,470.00
Total 451,016 $4,400,859.64
Click to enlarge

Full Disclosure: No position in the above funds.