Posts tagged: pimco

Jan 11 2010

Mutual Fund Monday: PIMCO Launching New Global Fund.

According to a recent Edgar filing , PIMCO will soon be launching a new fund: PIMCO Global Opportunities Fund .

It’s going to be a global value fund of common and preferred stock. The fund will target equities in one of 3 countries, one of which may be the U.S..

Criteria used for determining whether a stock is undervalued by the market include: asset value, book value and cash flow and earnings estimates.

The Fund considers large and mid cap companies to have a market capitalization greater than $1.5 billion, but the fund is not limited by size and may invest without limitation in securities that are economically tied to foreign countries as well as emerging market countries.

The fund is also not limited solely to stocks and may also invest in U.S. and foreign government debt and other debt securities like bank loans. PIMCO selects such securities on the basis of value and not just rate or rating. This leaves the management team open to high yield bonds (A.K.A. Junk Bonds) and any rating.

As you can see, this is a pretty unlimited fund, and not strictly adhering to any one market cap, investing style or security type but it could make for a good core holding. The folks at PIMCO have a good name, and their bond team are among some of the few to have not only called the mortgage meltdown successfully, but also positioned their funds to take advantage at just the right time.

Since the fund can invest in both equities and debt securities in foreign countries, this opens them up to being susceptible to equity risk, currency risk, leverage risk and pretty much any other kind of risk when investing in anything other than CDs. :)

PIMCO has not yet named portfolio managers for the fund.

If you’re interested in this fund, feel free to read the whole Edgar filing – it’s informative, but not easily digested for beginners. Still, it’s worth a read if only to acquaint yourself with the kinds of data found in a Form N-1A SEC filing.


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Sep 23 2009

3 Recommended Pimco Bond Funds.

Bonds are an important part of any good asset allocation, and here are 3 bond funds from the Pimco firm as recommended in a recent Kiplinger magazine article.

PIMCO bond total return (PTTAX).

Manager Bill Gross sticks to investment grade, intermediate-term U.S. bonds for this fund. The expense ratio for this fund is 0.90%, and yields 4.97% and has a YTD return of 10.44%.

By comparison, the Harbor Bond fund (HABDX) carries an expense ratio for this fund is a mere 0.60% of assets and the yield is a respectable 3.91% and has a YTD return of 10.89%.

PTTAX vs HABDX

As you can see from the chart, performance parity of the two funds is very tight.

PIMCO Investment Grade Corporate (PBDDX).

Manager Mark Kiesel has the latitude to venture into other sectors with this fund, but his performance suggests it’s warranted. The fund’s D shares have a YTD return of 12.57%, expense ratio of 0.90% and yield 4.82%.

PIMCO Emerging Local Bond D (PLBDX).

This fund invests in emerging markets debt that is denominated in the local currency. Admittedly, it’s a bit riskier than the other two, but it also provides global diversification. Currently the YTD return on this fund is a whopping 19.81%, and the expense ratio is higher as well, coming in at 1.35%. The yield is a very nice 5.37%.

All funds in this article are rated 5 stars by Morningstar


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