Bond fund specialist Pacific Investment Management plans to launch a new portfolio run by Mohamed El-Erian, who helped increase Harvard University's huge endowment as the school's chief investment officer.
El-Erian, an emerging markets specialist, will run the PIMCO Global Advantage Fund and have the ability to select among a wide range of fixed-income securities, according to a regulatory filing.
The fund will invest at least 65 percent of its assets in "fixed-income instruments that are economically tied to at least three countries," PIMCO said in a filing this month with the U.S. Securities and Exchange Commission.
El-Erian may select securities denominated in foreign currencies and pick derivatives, including options, futures contracts and swap agreements.
El-Erian left Harvard last year after less than two years on the East Coast to return to California, saying he wanted to be closer to his family.
In January, he rejoined his former employer, PIMCO, and is now co-chief investment officer will Bill Gross, long considered the world's most influential bond investor.
He is also co-chief executive officer of the firm, a unit of German insurer Allianz SE.
At Harvard, El-Erian helped boost the Ivy League university's already enormous endowment to nearly $35 billion, thanks to a 23 percent return in the fiscal year that ended in June 2007.
PIMCO manages roughly $746 billion. Analysts expect El-Erian, an economist with a proven track record in delivering returns, to help attract money from new investors.