Pacific Investment Management Co.’s Bill Gross has bought more mortgage bonds for his Total Return Fund, the largest bond fund at $136 billion in assets under management.
Mortgage bonds made up 83% of the fund at the end of January, according to a Bloomberg report.
That’s the highest level of mortgage bonds in the fund in at least a year. In November, 81% of the fund was made up of mortgage bonds.
In December, Gross cut back on mortgages in favor of Treasury bonds, pushing mortgage debt down to 62%.
Gross’ renewed bullishness on mortgage bonds comes amid government efforts to shore up housing debt.
He sold Treasury bonds last month as he bought mortgage debt.
Late last year, Gross said he regretted missing out on a runup in Treasury bonds as investors fled stocks for the safety of federal debt.
Pimco manages about $750 billion in assets and is part of Munich-based insurer Allianz SE.
