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"My famous (infamous?) 'Short of a lifetime' trade on the German Bund market was well timed but not necessarily well executed," Gross, who runs the Janus Global Unconstrained Fund, wrote in his latest report to clients titled "Mr. Bleu."
Gross's Janus Global Unconstrained portfolio is down 0.40 percent so far this year, underperforming its peers by 1.88 percentage points and lagging 93 percent of its non-traditional bond category, according to Morningstar data on Tuesday.
Last month, Gross said he placed a wager against German bonds, tweeting on April 21 that German 10-year Bunds were "the short of a lifetime" and that the bet was better than the pound in 1993.
Gross was referring to investors George Soros and Stanley Druckenmiller, who made their names betting against the pound in 1992.
German 10-year Bund yields set record lows following the European Central Bank's purchases of public-sector bonds on March 9 as part of its trillion-euro stimulus program, with the latest low of 0.049 percent touched on April 17.
Gross's investment appeared prescient, with prices on German bonds falling and their yields rising. The yield on the 10-year Bund has risen to 0.54 percent on Wednesday.
All told, Gross said the bet against Bunds "was a prime example of opportunities hatched by the excess of global monetary policy—zero based policy rates and tag team match quantitative easing programs which continue to encourage malinvestment in financial assets as opposed to the real economy."
Gross said there was still opportunity to make money.
The ECB is still committed for over a year's worth of 700 billion euro asset purchases, while the U.S. Federal Reserve is "chomping at the bit" to raise policy rates in late-2015, Gross said. "Partially because of these differences, there remain significant disparities in global asset prices that potentially can be successfully arbitraged."
Gross said 10-year Treasurys still trade at a 175-basis-point premium to 10-year Bunds versus a long-term historical average of 25 basis or so.
"A purchase of Treasuries and a sale of Bunds allows for not only a potential capital gain if the spread narrows, but a yield pickup while the Rip Van Winkle investor potentially waits for a probable outcome," Gross said.