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| PIMCO High Yield Strategy |
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| Investment Style |
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PIMCO’s approach to the high yield market is consistent with our conservative, yet innovative, approach to fixed income markets in general. Our philosophy embodies five key principles:
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focus on bottom-up fundamental credit research;
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focus on higher quality below investment grade credits;
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focus on total return, not just income;
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diversify broadly across issuers and industries; and
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capitalize on PIMCO’s expertise in all regions and credit sectors to identify non-traditional high yield opportunities. |
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| Benchmark |
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While the majority of our high yield portfolios are benchmarked against a higher quality, BB/B-rated index, our expertise is suitable to managing against the full spectrum of high yield indices, including global and European-based indices, both issuer constrained and market value weighted.
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| Portfolio Duration |
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We generally operate within a moderate Duration range of our benchmark, usually plus or minus one year. |
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| Market Sectors
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We will invest primarily in corporates, and where client guidelines permit will invest in bank loans, convertibles, emerging markets, government, mortgages, asset backed, and derivatives instruments.
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| Value Added |
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High Yield seeks to add value through multiple sources including:
- Credit Research
- Bottom Up Techniques to Identify Undervalued Securities
- Duration Management
- Utilization of "Nontraditional" Sectors
- Cost Efficient Trading
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| For more information, please go to the
Contact Us page. |
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Past performance is not a guarantee or a reliable indicator of future results. High yield, lower-rated, securities involve greater risk than higher-rated securities. Investing in the bond market is subject to certain risks including market, interest-rate, issuer, credit, and inflation risk. Investing in non-U.S. securities involves heightened risk due to currency fluctuations, and economic and political risks, which may be enhanced in emerging markets. Mortgage and asset-backed securities may be sensitive to changes in interest rates, subject to early repayment risk, and while generally backed by a government, government-agency or private guarantor there is no assurance that the guarantor will meet its obligations. Convertible securities may be called before intended, which may have an adverse effect on investment objectives. Derivatives may involve certain costs and risks such as liquidity, interest rate, market, credit, management and the risk that a position could not be closed when most advantageous. Investing in derivatives could lose more than the amount invested.
This material has been distributed for educational purposes only and should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. No part of this material may be reproduced in any form, or referred to in any other publication, without express written permission of Pacific Investment Management Company LLC, 840 Newport Center Drive, Newport Beach, CA 92660. ©2008, PIMCO.
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