Pacific Investment Management Co. is becoming less dependent on Bill Gross, preparing for an eventual future without the world’s best-known bond investor and adding pressure on its rising stars to live up to his legacy.
U.S. industries tied to housing are likely to grow about four times as fast as the economy, making them top picks for investors, said Mark Kiesel, global head of corporate bond portfolios at Pacific Investment Management Co.
Investors are “finally” acknowledging the risks of holding corporate bonds with yields hovering at about record lows as the Federal Reserve holds benchmark interest rates at close to zero for a fifth year, according to Pacific Investment Management Co.
Pacific Investment Management Co. is wagering on sectors from chemicals to airlines with ties to regions with the best outlooks for growth as Europe’s debt crisis and the U.S. fiscal cliff of higher taxes and spending reductions threaten to derail the global recovery.
Bond investors should cut risk and hold more cash as Europe’s sovereign debt crisis may lead to a recession that will hurt companies around the world, according to Pacific Investment Management Co.’s Mark Kiesel.