Pimco, manager of the world's largest bond mutual fund, was the highest ranked of 23 rivals in an institutional investor brand-loyalty survey in February by Cambridge, Massachusetts- based Cogent Research. AllianceBernstein came last.
"While fixed-income-heavy Pimco clearly benefits from the declining interest rates that we've seen over the last years, it remains to be seen how they will do once this trend reverses," said Equinet's Haessler, who has an accumulate rating on Munich- based Allianz.
Inflation Issue
Inflation, which may accelerate as European leaders seek to resolve the region's debt crisis, is not a concern for Pimco's business, Ralph said.
"Pimco has been particularly good in taking their clients from core fixed-income products to various non-core products such as inflation-protected or real-return oriented strategies that protect clients from inflation," he said.
Money managers such as Pimco and BlackRock, which earn fees based on the assets that they manage for clients, traditionally benefit from rising stock markets and investor deposits into higher-fee active stock and bond funds. Treasuries made investors 9 percent over the past two years, according to indexes compiled by Bank of America Merrill Lynch.
Allianz Global Investors, the remainder of the insurer's asset management business led by Elizabeth Corley, has announced plans to cut costs as it integrates international business units and creates three European hubs in London, Paris and Frankfurt. AGI, with 291 billion euros in assets under management, had a cost-income ratio, a measure of efficiency, of 69.3 percent at the end of June compared with Pimco's 52.9 percent.
Cost Control
"AGI has already done a lot of good work on the cost side," Ralph said. "While quarters may move around a bit, it's absolutely clear that the cost-income ratio will be trending down."
Pimco already has an "outstanding" cost-income ratio and therefore will focus on further growth, Ralph said.