The world's top bond fund has dumped US government debt - so should you

The manager of the world's most successful bond fund has ditched all his US government-related debt. So has the great bond bull market just come to an end? John Stepek looks at what's going on.

The world's biggest and most successful bond fund has ditched all its US government-related debt.

Bill Gross, manager of the $237bn Pimco Total Return fund, had warned recently that the fund was getting out of US Treasuries. When the latest batch of quantitative easing (QE2) ends in June, he reckons yields could rise substantially (ie bond prices will fall). So it's not a huge surprise.

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John Stepek

John Stepek is a senior reporter at Bloomberg News and a former editor of MoneyWeek magazine. He graduated from Strathclyde University with a degree in psychology in 1996 and has always been fascinated by the gap between the way the market works in theory and the way it works in practice, and by how our deep-rooted instincts work against our best interests as investors.

He started out in journalism by writing articles about the specific business challenges facing family firms. In 2003, he took a job on the finance desk of Teletext, where he spent two years covering the markets and breaking financial news.

His work has been published in Families in Business, Shares magazine, Spear's Magazine, The Sunday Times, and The Spectator among others. He has also appeared as an expert commentator on BBC Radio 4's Today programme, BBC Radio Scotland, Newsnight, Daily Politics and Bloomberg. His first book, on contrarian investing, The Sceptical Investor, was released in March 2019. You can follow John on Twitter at @john_stepek.