The investing world is going to change in a few weeks when companies like PIMCO are allowed to sell alternative products to retail investors. These products are going to be snapped up by the uninitiated hoping for a higher return…for a fee of course. Has everyone forgotten 2008? Kirsten Grind reports at the Wall Street Journal:
Douglas Hodge, Pimco’s chief operating officer, called alternative investments “a very important area for us” in an interview with The Wall Street Journal. He said the firm is responding to increased demand from investors of all types, as well as to changing regulations.
But the push into riskier, more-complex products marks a shift for the firm, whose bond funds have long been seen as some of the safest and most reliable on the market.
The SEC moved last month to lift a restriction prohibiting hedge funds, private-equity firms and other businesses from publicizing shares in private offerings as part of the Jumpstart Our Business Startups Act, effective Sept. 23. That allows Pimco and others to pitch alternative products more directly to institutional investors as well as wealthy individuals.
“The world is going to change here because of the JOBS Act,” Mr. Hodge said.