PIMCO Names New Head of Alternatives Product Development

(September 29, 2011) — As Pacific Investment Management Co. (PIMCO), which runs the world’s largest bond fund, expands into hedge funds and distressed debt strategies, the firm has selected a new head of alternatives product development.

Jennifer Bridwell has been chosen for the new position — an expansion of her previous role since 2005 as a managing director and head of mortgage strategies development at the firm.

“PIMCO has built over a number of years a large and very successful alternatives business that includes hedge funds and private strategies,” said Douglas M. Hodge, PIMCO’s Chief Operating Officer, in a statement. “Jennifer’s deep knowledge and experience in the alternatives space will enable us to marshal the full range of PIMCO’s resources to develop and manage investment solutions that deliver value to our clients.”

Over the past decade, PIMCO has attracted about $16 billion in assets into mortgage strategies as it opened funds to invest in troubled mortgages and bonds backed by real-estate loans.

“Our approach to delivering value in alternatives is to develop durable strategies where PIMCO has established expertise and capabilities and that capitalize on market opportunities for our clients,” said Bridwell in a statement.

The increasing popularity and interest in alternative investment is evident following recent research by Eager, Davis & Holmes, a Louisville-based consultant to investment managers, that revealed that institutional hires in alternative investments and real estate increased in the first two quarters of 2011 at the expense of domestic active equity and fixed-income. “We’ve known for a while now that institutional investments in equity were out of favor, while interest in alternatives — particularly private equity — have increased,” David Holmes, a partner at the firm, told aiCIO in August.

High volatility in equities has pushed investors to reduce their risk by pursuing other asset classes. “Pension funds are seriously underfunded — they’re looking to increase returns. Equities have traditionally been a hedge against inflation — but they’re not the only answer now,” Holmes added.