'Bond King' Bill Gross Nets Millions On Treasury Market Rebound
Portfolio Pulse from Neil Dennis
Bill Gross, known as the 'Bond King', has potentially earned millions from the November rally in the U.S. Treasury market by purchasing SOFR futures in October. Gross, who co-founded PIMCO and managed its Total Return Fund, predicted a market turnaround when Treasury yields were at 16-year highs. He bought 3,000 SOFR three-month March 2025 contracts, which may have netted him $4 million. The iShares $ Floating Rate Bond UCITS ETF (FLOT) gained 0.4% in November. Gross's bet was based on the expectation that the Federal Reserve had ended its rate hike cycle, with yields starting to fall.
December 01, 2023 | 7:48 pm
News sentiment analysis
Sort by:
Ascending
POSITIVE IMPACT
The iShares $ Floating Rate Bond UCITS ETF (FLOT) gained 0.4% in November, potentially benefiting from the same market conditions that allowed Bill Gross to profit from his SOFR futures investment.
Given that FLOT tracks securities referencing SOFR, the ETF's performance is likely to be positively correlated with the success of SOFR futures. As Bill Gross's investment in SOFR futures proved profitable, it suggests a favorable environment for FLOT as well, which is reflected in its November gain. However, the impact on FLOT is indirect and depends on broader market trends and the Fed's rate decisions.
CONFIDENCE 80
IMPORTANCE 60
RELEVANCE 70