Pacific Investment Management Co. is seeking to grow assets in a multi-asset mutual fund by 25% to US$2 billion ($2.71 billion) this year, betting that a 60/40 equity-debt split will attract more investors in Asia.
The company’s Balanced Income and Growth Fund will distribute in Taiwan this year, after already being offered in mainland China, Hong Kong and Singapore, Marcio Bogoricin, head of global wealth management for Asia ex-Japan, said in an interview.
The 60/40 approach — building portfolios with 60% allocated to equity and 40% to bonds — broke down in recent years when inflation was high and the US Federal Reserve was raising interest rates.
Pimco’s base-case scenario is that central banks in developed markets can keep cutting rates this year on the back of looser labor markets, even as US President Donald Trump increases tariffs on imports from China.
“The trend of 60/40 will continue to be a big theme this year,” Bogoricin said. “2024 was the year of fixed income, and in 2025, given markets are more optimistic about equities, we expect 60/40 to be back in favour.”
The Pimco Balanced Income and Growth Fund, also known as PBIG, grew by US$760 million over the past nine months to US$1.6 billion at the end of January. It allocates 60% to global equities and 40% to high-quality fixed income.
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A 60/40 construct would have given investors an annualised return of 7.18% since 1990, with only two negative periods, based on a three-year period, according to data compiled by Pimco and Bloomberg.
Pimco has been expanding its distribution in Asia, as it lures more investors seeking to tap investment strategies of global funds. The company started distributing PBIG in mainland China late last year through its Qualified Domestic Institutional Investors fund.
