Arguably the most prominent fixed income investor of recent decades has retired.

Bill Gross, whose name was associated most closely with US fixed income firm PIMCO before being controversially ousted, has retired from Janus Henderson Investors, the New York-listed business he joined in 2014.

Gross has decided to focus on managing his own money and his private charitable foundation, Janus Henderson Investors said in a statement yesterday. 

His retirement brings down the curtain on a four-decade career. Gross co-founded PIMCO in 1971, serving as its managing director and chief investment officer. His comments on bond markets, interest rates and monetary policy became news events and market-influencers in their own right.

His tenure at PIMCO, now owned by European financial conglomerate Allianz, ended acrimoniously. In 2015 Gross sued Pacific Investment Management Co - to give its full name – and Allianz for $200 million, claiming he was wrongfully forced out by executives who wanted his share of the bonus pool. The legal row was subsequently settled for $81 million. 

Recent investment performance during his tenure at Janus Henderson Investors has been challenging in some respects. “While the Unconstrained strategy Mr Gross manages has underperformed its 3-month Libor benchmark since Mr Gross joined Janus Henderson in late 2014, nominal performance has been positive over the time period,” Janus Henderson Investors said. In January media reports said that one of Gross's funds, the Janus Henderson Global Unconstrained Bond Fund, had suffered outflows. A Bloomberg report on January 13 said that investors have scuttled from the fund. Bets placed by the fund anticipated that rates on US Treasuries and German bunds would converge but that prediction did not bear fruit. 

“In addition, and in line with Mr Gross’s career success as a bond investor, his currently existing Total Return strategy has outperformed its US Aggregate benchmark by 89 basis points, net of fees, through 12/31/2018," the firm said.

Gross also oversees the $390 million-asset William, Jeff and Jennifer Gross Family Foundation, which donated $21,450,000 to 28 non-profits in 2018, including Doctors Without Borders and the Children's Hospital of Orange County. 

Gross, 74, has made philanthropic donations totaling $800 million in the past 20 years.

Following his retirement, portfolio management responsibilities for the Global Unconstrained Bond funds and related strategies will be assumed by the Global Macro Fixed Income team. Nick Maroutsos, co-head of global bonds and portfolio manager at Janus Henderson, will become portfolio manager of the Global Unconstrained Bond funds taking effect on February 15 to assist with the transition.

Also on February 15, the Global Unconstrained Bond funds domiciled in the United States and Ireland will be renamed Absolute Return Income Opportunities.

Results
Separately, Janus Henderson Group reported a fall in its fourth-quarter net income attributable to shareholders of $106.8 million, down from $111.1 million in the previous quarter and sharply down from $471.7 million a year ago, although that fall was greatly exaggerated by the fact that the Q4 2017 figure included a one-time non-cash tax benefit of $340.7 million related to changes in US tax legislation.

On an adjusted basis, net income attributable to the group fell  by 15 per cent on the quarter to $117.5 million.

“Despite this progress and our continued success taking market share in our largest geography - US active equity mutual funds - we faced the same global market challenges and headwinds as the wider industry, combined with an aggregate $18 billion outflow, which was disappointing,” Dick Weil, chief executive, said.