Wednesday, March 19, 2014

Morningstar Downgrades Money Manager PIMCO

Morningstar has Pacific Investment Management Co.'s overall management grade by one notch. This comes as a result of  the higher degree of uncertainty after the departure of its Chief Executive Officer Mohamed El-Erian and other key personnel.

The research firm downgraded Pimco's stewardship grade to a C from B following a comprehensive review of Pimco which included a visit to the Newport Beach, California-based fund company by Morningstar analyst Eric Jacobson on March 10. The highest grade is an A and the worst is an F, reports Reuters.

Morningstar analysts said: "The changes to PIMCO's Stewardship Grade and Parent Pillar score do not automatically affect PIMCO funds' overall Morningstar Analyst Ratings for Funds, yet it is logical to assume that Morningstar analysts would move quickly from here to reassess those ratings on a fund-by-fund basis."

Morningstar also said the firm is preparing a follow-up piece for early April 2014 "that will summarize our current opinions on individual PIMCO funds. In that piece we'll also answer a number of PIMCO-related questions that we have been receiving most frequently from investors."

In 2012, the Morningstar Fixed Income Fund Manager of the Year award  was given to PIMCO based on the strength of the manager, performance, strategy, and firm's stewardship.

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