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Pimco is wagering at least $10 billion in the credit-default swaps market that U.S. corporate bonds will gain as the Federal Reserve extends unprecedented stimulus into 2014, according to traders and investors.

The manager of the world’s biggest bond mutual fund amassed the positions by creating swaps tied to the Markit CDX North American Investment Grade Index, according to sources.

Pimco is using derivatives that are quicker, easier and cheaper to trade than the bonds they’re tied to after redemptions and losses shrunk its $248 billion Total Return Fund by 15 percent in six months.