With performance up, outflows at Pimco Total Return Fund slow

Client redemptions from Pacific Investment Management Co.'s flagship fund last month slowed to the lowest level since July 2014. Investors withdrew $2.7 billion from the Pimco Total Return Fund in May, compared with $5.6 billion in April and $7.3 billion in March, according to the Newport Beach, Calif.-based firm. Assets in the fund have plunged to $107.3 billion, down more than 63% from a peak of $293 billion in April 2013. Pimco's flagship fund, which last month lost the title of the world's biggest bond mutual fund, has faced record redemptions since Bill Gross left on Sept. 26 for Denver-based Janus Capital Group Inc. The fund, now run by Scott Mather, Mark Kiesel and Mihir Worah, returned 1.3% this year, outperforming 82% of similarly run funds, according to data compiled by Bloomberg. The Vanguard Total Bond Market Index Fund, a passive product tracking a broad fixed-income benchmark, became the world's biggest bond fund with $117.5 billion in assets at the end of April. It has returned 0.6% this year. Mr. Gross, who co-founded Pimco in 1971 and built it into one of the world's largest investment firms, departed after losing a power struggle. He now runs the $1.52 billion Janus Global Unconstrained Bond Fund.