The Investing World Is Going to Change

PIMCO CEO Mohamed El-Erian

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.

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E.J. Smith - Your Survival Guy

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E.J. Smith is the Founder of YourSurvivalGuy.com, Managing Director at Richard C. Young & Co., Ltd., a Managing Editor of Richardcyoung.com, and Editor-in-Chief of Youngresearch.com. E.J. graduated from Babson College in Wellesley, Massachusetts, with a B.S. in finance and investments. In 1995, E.J. began his investment career at Fidelity Investments in Boston before joining Richard C. Young & Co., Ltd. in 1998. E.J. has trained at Sig Sauer Academy in Epping, NH, where he completed course-work in Practical and Defensive Handgun, Conceal Carry Pistol, Shotguns, Precision Scope Rifle and Kidnapping Prevention. E.J. plays a Yamaha Recording Custom drum set with Zilldjian cymbals. His first drum set was a 5-piece Slingerland with Zilldjians. He grew-up worshiping Neil Peart of the band Rush, and loves the song Tom Sawyer—the name of his family’s boat, a Grady-White Canyon 306. He grew up in Mattapoisett, MA, an idyllic small town on the water near Cape Cod. He spends time in Newport, RI and Bartlett, NH—both as far away from Wall Street as one could mentally get. The Newport office is on a quiet, tree lined street not far from the harbor and the log cabin in Bartlett, NH, the “Live Free or Die” state, sits on the edge of the White Mountain National Forest. He enjoys spending time in Key West and Paris. Please get in touch with E.J. at ejsmith@youngresearch.com. Sign up here to receive all the best content from Richardcyoung.com each week.