Back in December, I published some articles describing Bill Gross’s closed-end fund buying spree with his personal money. Mr. Gross purchased over $22 million of a wide selection of Pimco closed-end bond funds: municipal, high yield, corporate and floating rate bonds.
I took a look at how these purchases have done since then. The results are quite impressive. Every purchase has been profitable with a gain ranging from 3.5% up to 25%. Mr. Gross has earned over $3 million in profits in less than two months. The percentage gain on the “portfolio” is 13.98% including dividends which are paid out monthly on these funds.
Trade Date | Shares | Price | $ Invested | 2/2/2011 Prc | Dividends | Value | Profit | %Profit | ||
12/08/2010 | 12,096 | 9.75 | $117,936.00 | Muni | 10.61 | 0.140 | $130,032.00 | $12,096.00 | 10.26% | |
9,900 | 11.65 | $115,335.00 | Muni | 11.91 | 0.154 | $119,433.60 | $4,098.60 | 3.55% | ||
19,056 | 8.2741 | $157,671.25 | Muni | 8.73 | 0.126 | $168,759.94 | $11,088.69 | 7.03% | ||
12/09/2010 | 36,225 | 11.5997 | $420,199.13 | Muni | 11.91 | 0.075 | $434,156.63 | $13,957.49 | 3.32% | |
50,000 | 8.2465 | $412,325.00 | Muni | 8.73 | 0.063 | $439,650.00 | $27,325.00 | 6.63% | ||
23,333 | 12.048 | $281,115.98 | Muni | 13.04 | 0.081 | $306,152.29 | $25,036.31 | 8.91% | ||
42,864 | 8.65 | $370,773.60 | Muni | 8.92 | 0.060 | $384,918.72 | $14,145.12 | 3.82% | ||
88,156 | 9.8493 | $868,274.89 | Muni | 10.61 | 0.070 | $941,506.08 | $73,231.19 | 8.43% | ||
12/10/2010 | 19,168 | 11.5743 | $221,856.18 | Muni | 11.91 | 0.077 | $229,766.82 | $7,910.63 | 3.57% | |
48,816 | 8.1387 | $397,298.78 | Muni | 8.73 | 0.063 | $429,239.09 | $31,940.31 | 8.04% | ||
32,002 | 12.0397 | $385,294.48 | Muni | 13.04 | 0.081 | $419,898.24 | $34,603.76 | 8.98% | ||
19,400 | 8.5211 | $165,309.34 | Muni | 8.92 | 0.060 | $174,212.00 | $8,902.66 | 5.39% | ||
50,000 | 9.7494 | $487,470.00 | Muni | 10.61 | 0.070 | $534,000.00 | $46,530.00 | 9.55% | ||
12/13/2010 | 50,000 | 11.5886 | $579,430.00 | Muni | 11.91 | 0.075 | $599,250.00 | $19,820.00 | 3.42% | |
14,439 | 11.95 | $172,546.05 | Muni | 13.04 | 0.081 | $189,454.12 | $16,908.07 | 9.80% | ||
6,632 | 8.47 | $56,173.04 | Muni | 8.92 | 0.060 | $59,555.36 | $3,382.32 | 6.02% | ||
14,500 | 8.0723 | $117,048.35 | Muni | 8.73 | 0.063 | $127,498.50 | $10,450.15 | 8.93% | ||
23,503 | 9.47 | $222,573.41 | Muni | 10.61 | 0.070 | $251,012.04 | $28,438.63 | 12.78% | ||
149,000 | 12.1342 | $1,807,995.80 | HiYld | 13.35 | 0.122 | $2,007,328.00 | $199,332.20 | 11.03% | ||
114,465 | 10.8627 | $1,243,398.96 | Floaters | 12.25 | 0.075 | $1,410,781.13 | $167,382.17 | 13.46% | ||
128,033 | 9.3686 | $1,199,489.96 | Divers | 10.45 | 0.065 | $1,346,267.00 | $146,777.03 | 12.24% | ||
161,068 | 14.5761 | $2,347,743.27 | Corp | 16.75 | 0.106 | $2,714,962.21 | $367,218.93 | 15.64% | ||
142,615 | 15.8023 | $2,253,645.01 | Corp | 19.52 | 0.115 | $2,800,245.53 | $546,600.51 | 24.25% | ||
100,000 | 15.7 | $1,570,000.00 | Corp | 19.52 | 0.115 | $1,963,500.00 | $393,500.00 | 25.06% | ||
12/14/2010 | 16,237 | 15.8714 | $257,703.92 | Corp | 19.52 | 0.115 | $318,813.50 | $61,109.57 | 23.71% | |
50,000 | 12.0903 | $604,515.00 | HiYld | 13.35 | 0.122 | $673,600.00 | $69,085.00 | 11.43% | ||
50,000 | 9.6383 | $481,915.00 | Divers | 10.45 | 0.065 | $525,750.00 | $43,835.00 | 9.10% | ||
50,000 | 11.0896 | $554,480.00 | Floaters | 12.25 | 0.075 | $616,250.00 | $61,770.00 | 11.14% | ||
46,701 | 14.6249 | $682,997.45 | Corp | 16.75 | 0.106 | $787,192.06 | $104,194.60 | 15.26% | ||
12/27/2010 | 10,676 | 16.9787 | $181,264.60 | Corp | 19.52 | 0.115 | $209,623.26 | $28,358.66 | 15.64% | |
33,000 | 16.9532 | $559,455.60 | Corp | 19.52 | 0.115 | $647,955.00 | $88,499.40 | 15.82% | ||
8,735 | 16.9787 | $148,308.94 | Corp | 19.52 | 0.115 | $171,511.73 | $23,202.78 | 15.64% | ||
27,000 | 16.9532 | $457,736.40 | Corp | 19.52 | 0.115 | $530,145.00 | $72,408.60 | 15.82% | ||
12,942 | 16.9787 | $219,738.34 | Corp | 19.52 | 0.115 | $254,116.17 | $34,377.83 | 15.64% | ||
40,000 | 16.9532 | $678,128.00 | Corp | 19.52 | 0.115 | $785,400.00 | $107,272.00 | 15.82% | ||
12/28/2010 | 33,000 | 17.1969 | $567,497.70 | Corp | 19.52 | 0.115 | $647,955.00 | $80,457.30 | 14.18% | |
27,000 | 17.1969 | $464,316.30 | Corp | 19.52 | 0.115 | $530,145.00 | $65,828.70 | 14.18% | ||
40,000 | 17.1975 | $687,900.00 | Corp | 19.52 | 0.115 | $785,400.00 | $97,500.00 | 14.17% | ||
Totals | $22,516,860.75 | $3,148,575.22 | 13.98% |
The municipal bond funds were up in the single digit range (3% to 12%). The corporate, high yield and floating rate funds were up solid double digits on average.
The best performer has been PTY, which was also the largest purchase for Mr. Gross. The early December purchases are up well over 20%. Later PTY purchases are up in the mid teens.
PTY was recommended by Mr. Gross in this years Barron’s Roundtable discussion. On December 13, when the first purchase was made, PTY was selling at a 2.7% discount to net asset value. At today’s close (February 2), PTY is selling at an 18% premium!
Since the original purchases in early December, the NMUNP index (Nuveen Municipal Closed-End Fund Exchange Traded Index) has been close to unchanged. Most of the outperformance by the Pimco municipal bond funds has been caused by widening of the premium over net asset value.
For active traders who own these funds and have unused carryover losses from previous years, this may be a good time to take some money off the table. But long term investors who are tax constrained can just enjoy the high income stream that these funds continue to generate.
