Pimco, the bond manager that started expanding into stocks four years ago, hired Virginie Maisonneuve from Schroders to lead the push after Neel Kashkari left in January.
Maisonneuve, who was head of global and international stocks at Europeís biggest publicly traded fund company, will start in January in†Pimcoís London office, according to a statement today from Newport Beach, California-based†Pimco. Maisonneuve, 49, managed stock funds in Schrodersís London office for nine years, overseeing strategies such as Schroder International Alpha Fund.
Michael Diekmann, chief executive officer of†Pimco†parent Allianz SE, said earlier this month that the bond managerís expansion into stocks was proving more difficult than expected.†Pimco, seeking to expand into stocks in anticipation of an end to the three-decade bond rally, has gathered less than 1 percent of the firmís $1.97 trillion in assets into its four main stock funds.
ďVirginie is a proven equity investor and leader who has delivered a track record of success for clients throughout her 25-year career as a portfolio manager and a business builder,Ē Mohamed El-Erian,†Pimcoís chief executive officer and co-chief investment officer along with co-founder Bill Gross, said in the statement.
El-Erian and Gross, whose name is synonymous with fixed- income investing, have sought to expand beyond fixed income to stocks, alternative products such as hedge funds and exchange- traded funds. Unlike rivals such as BlackRock Inc., which made acquisitions to move beyond bonds,†Pimco†chose to grow by adding managers and strategies one at a time. By hiring Maisonneuve,†Pimco†is hoping to reinvigorate its stock push just as investors are fleeing the bond market, removing an estimated $128 billion from fixed-income mutual funds since May.
ďPimco†is disproportionately exposed to fixed-income investments and in 2013, as investors gravitate to U.S. equity mutual funds, itís important for them to try to keep more of those assets in-house,Ē said Todd Rosenbluth, director of mutual-fund research for S&P Capital IQ. ďHer U.S. fund has been good for investors in bullish markets and negative for them in down or bearish markets like in 2011.Ē
The $199 million Schroder International Alpha Fund, which Maisonneuve has managed since 2005, returned an annualized 15 percent in the past five years, ahead of 70 percent of rival funds, and 23 percent in the past 12 months, behind 65 percent of peers, according to data compiled by Bloomberg. In 2011, when the MSCI EAFE Index declined 12 percent, including reinvested dividends, the fund lost 17 percent. In 2009, the fund surged 47 percent as the MSCI EAFE returned 33 percent.
In a 2012 interview, Kashkari said the firmís equity funds were seeking to deliver strong performance over the next three years to five years, and would give up some upside to protect investors when markets declined. Maisonneuve joins a year after the departure of Kashkari, who was hired in 2009 to oversee the unitís expansion after earlier attempts to add stocks fizzled. Kashkari, who didnít manage any funds, stepped down saying he wanted to pursue a career in public service.
In Maisonneuveís $1 billion Global Equity Alpha strategy, which is domiciled in Luxembourg, performance has struggled over the last three years because it has a growth orientation, said Oliver Kettlewell, a London-based fund analyst for research firm Morningstar Inc. The fund should have performed better in 2012 and this year given the increase in global markets, Kettlewell said.
In the past five years, the Global Equity Alpha fund returned an annualized 14 percent, ahead of 68 percent of peers, and over the past three years itís returned 7.3 percent, behind 64 percent of rivals, according to data compiled by Bloomberg. This year, the fund is up 20 percent, ahead of 65 percent of similarly managed funds.
Maisonneuve also co-managed the $21 billion Vanguard International Growth Fund since 2005, alongside managers including M&G Investments and Baillie Gifford, according to Vanguard Group Inc.ís website. The fund returned an annualized 16 percent over the past five years, ahead of 59 percent of peers.
Maisonneuve, who will be a managing director, global head of equities and portfolio manager, joins the six female managing directors at†Pimco†out of 57 executives with that title, according to the firmís website. They include Jennifer Bridwell, global head of alternative product development; Sabrina Callin, who oversees†Pimcoís enhanced equity index and unconstrained bond products; Wendy Cupps, head of product management; and Jennifer Durham, chief compliance officer.
The equity unitís mutual funds account for about $3.8 billion of†Pimcoís assets. Stock strategies including†Pimcoís StocksPLUS funds, which attempt to beat the market using a combination of bonds and derivatives, total more than $50 billion, according to todayís statement.
All On Wall Street articles are archived after 7 days. REGISTER NOW for unlimited access to all recently archived articles, as well as thousands of searchable stories. Registered Members also gain access to exclusive industry white paper downloads, web seminars, blog discussions, the iPad App, CE Exams, and conference discounts. Qualified members may also choose to receive our free monthly magazine and any of our daily or weekly e-newsletters covering the latest breaking news, opinions from industry leaders, developing trends and growth strategies.