Star manager Bill Gross
has high hopes for the soon-to-be-launched ETF version of Pimco Total Return Fund
(PTTAX) (MFWire coverage
). His expectations come despite the remarkable outflows the mutual fund saw in 2011, reports Jason Kephart of InvestmentNews
"We're working on large expectations here," Gross said during the ETF Virtual Summit
. "We're very proud of the relationship we have with retail firms and our existing distribution channels ... but here's a chance for small investors to get access to it."
Gross also reportedly said during the Web conference that he is expecting the Total Return ETF, which will be launched on March 1, to become the largest ETF in the world, following the footsteps of the mutual fund.
But Kephart states that SSgA's SPDR S&P 500 ETF
is currently the largest ETF in the world with $95 billion in assets. Pimco Total Return
is the largest mutual fund in the world with $244 billion in AUM. Pitting the two products creates a potential battle royal.
"Over a long period of time, we've done well ... and we hope we can do as well with the ETF as we've done with the fund over the past 20 years," said Gross.
Morningstar ETF research director Scott Burns tells the news service that the ETF version opens the door to more and new investors, especially those living abroad.
"Basically anyone that has access to the New York Stock Exchange will be able to invest in it," he is quoted as saying.
Based on the prospectus, the ETF version will charge a 55 basis point expense ratio, which is lower than the 90 basis points the mutual fund counterpart currently charges.
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