Text on screen: PIMCO
PIMCO provides services only to qualified institutions and investors. This is not an offer to any person in any jurisdiction where unlawful or unauthorized.
Text on screen: Justin Blesy, Asset Allocation Strategist
Blesy: Thank you for joining to hear about PIMCO’s newest offering – the PIMCO Managed Balanced Portfolio, or as we commonly call: PBAL for short, which is its ETF ticker.
Over the next 5 minutes or so, we are going to:
Talk about why we are launching PBAL today
Why we think it’s different from the many options available to Canadian investors in the balanced category and lastly,
We will discuss the ways it can potentially fit into investor portfolios.
When we talk about balanced portfolios today, one of the most important questions investors are wrestling with is where active management truly adds value. PIMCO has studied this globally and our research shows a clear pattern whereby active equity managers tend to underperform the average passive peer after fees, while in contrast, active bond managers have historically outperformed the typical passive offerings in their categories after fees.
Text on screen: TITLE - Why does active management work in fixed income?
SUBTITLE - Persistent inefficiencies create opportunities for active managers; Below the title, there are three circular icons, each paired with a short explanation: Left circle (blue): Icon: A simple line chart rising upward. Text: “Index Replication is challenging in bond markets.” Middle circle (green): Icon: Two arrows, one pointing up and one pointing down. Text: “Bond Index design may be suboptimal.” Right circle (purple): Icon: A group of three simplified human figures. Text: “Many Bond Investors do not Maximize Profits.” At the bottom of the slide, there is small text noting: “SOURCE: PIMCO. For illustrative purposes only.”
There are several structural reasons behind this:
First, Bond markets are inherently more complex and harder to replicate than equity markets.
Second, Bond indices often skew toward the most indebted issuers, which isn’t always where investors want to allocate capital.
And finally, many participants in fixed income — such as central banks — are not total return motivated buyers, creating pricing inefficiencies that skilled active managers can often exploit.
All of this means that active management tends to matter more in fixed income than in equities.
Text on screen: TITLE - PIMCO Managed Balanced Portfolio
SUBTITLE - Active where it matters, passive where it saves; Below the text, the slide displays three circular icons, each paired with a short label: Left circle (blue): Icon: A pie chart divided into three sections. Text below: “Comprehensive 60/40 Solution.” Middle circle (green): Icon: A price tag symbol. Text below: “Cost-Effective Approach.” Right circle (purple): Icon: A stylized hand holding upward‑pointing bar chart shapes. Text below: “PIMCO Advantage.” At the very bottom of the slide, there is small disclaimer text noting the date “As of 31 December 2025” along with a standard investment risk disclosure.
And that thinking helped shape the PIMCO Managed Balanced Portfolio. The goal was to preserve the simplicity and convenience of a traditional 60/40 balanced fund, but deliver it at a cost effective level that leverages active and passive where each makes the most sense. Our tagline captures it well:
“Active where it matters (in fixed income), passive where it saves (in equities).”
To execute on that philosophy:
PBAL incorporates large, established passive equity strategies to obtain efficient, broad global equity exposure.
And PBAL pairs that with PIMCO’s active fixed income strategies, which have a long history of strong returns.
The result is a single ticket solution that still provides the global diversification and automatic rebalancing investors expect from balanced funds — but now with what we believe is a more effective blend of active and passive components, and at an attractive price point, supported by the full breadth of PIMCO’s global resources. Specifically, the management fee for the Series F and ETF Series of the fund is 29 bps, and unitholders will also indirectly pay the management fees of the underlying third-party ETFs.
Now with that as an introduction, let’s discuss further how we construct the portfolio.
PIMCO has been helping investors navigate changing markets for more than 50 years, and we have been managing multi‑asset portfolios globally for nearly 20 years, with billions of client assets entrusted to us across a range of multi-asset strategies. That experience is built directly into PBAL.
Text on screen: TITLE - PIMCO Managed Balanced Portfolio; Beneath the title, there is a line of benchmark information in smaller text, which lists several index components and their percentage weights: 45% MSCI ACWI ex Canada; 15% S&P/TSX Index; 40% BBG Global Agg CAD-Hedged. At the center of the slide, there is a large circular pie chart divided into two colored segments: 60% on the left side (shown in green) 40% on the right side (shown in blue) Surrounding the pie chart is a decorative dotted ring in a maroon/purple color. To the left of the pie chart is a green rectangular label reading: “Passive Global Equities.” To the right is a blue rectangular label reading: “Active PIMCO Fixed Income.” Below the chart, there is a maroon banner-style label spanning the width of the graphic labeled: “Asset Allocation Oversight.” At the bottom of the slide, small disclosure text notes: “As of 31 December 2025. SOURCE: PIMCO. For illustrative purposes only.”
The fund has a starting point of 60% passive global equity exposure and 40% active fixed income managed by PIMCO, and we aim to add value through smart adjustments across regions and sectors in our allocation decisions across the underlying funds as well as through the active management of the PIMCO bond strategies.
It’s important to note, while we revisit the allocations across the underlying funds every month, our active bond strategies are repositioned daily based on PIMCO’s changing market views. That means investors can benefit from two layers of active management working in real time.
Text on screen: TITLE - PIMCO Managed Balanced Portfolio – Portfolio Management Team; The slide is organized into sections featuring names, titles, and roles of individuals involved in managing the portfolio. It highlights multiple managers across different areas of responsibility, grouped into categories. Top Section: Portfolio Co‑PMs Three individuals are listed, each with: Their name, A corporate title (e.g., EVP or MD), Their role within the PIMCO Balanced Portfolio (such as Co‑PM or Asset Allocation Portfolio Manager), Their years of investment experience. Middle Section: Underlying Fund Portfolio Managers. This section contains several managers arranged in two rows. Each entry includes: The manager’s name and title (e.g., MD or EVP), Their leadership role in a specific PIMCO fund strategy (e.g., Short‑Term Portfolio Management, Low Duration strategy, Global Credit strategy), Their years of investment experience. The entries are placed inside colored rectangular panels, typically blue, green, or maroon, for visual grouping. Bottom Section: Third‑Party – Underlying Equity Fund Managers, Three external firms are listed: BlackRock, BMO, Vanguard. Under each firm name, the slide lists specific equity index ETFs or strategies associated with that firm (for example, S&P/TSX Capped Composite Index ETF, S&P 500 Index ETF, Emerging Markets Index ETF). Footer: At the bottom, small disclosure text states: “Source: PIMCO. As of 30 September 2025. For illustrative purposes only.”
The fund is led by PIMCO’s experienced Asset Allocation team, including Emmanuel Sharef, Erin Brown, and Vinayak Seshasayee, the same team responsible for managing our $2 BN PIMCO Canada Managed Bond Pools franchise that has historically delivered strong returns .
Most balanced funds available today are either fully active or fully passive and often built only with in‑house products. PBAL combines active fixed income and passive equity strategies where each adds the most value. It’s an open‑architecture approach designed to give investors the best of all worlds.
Bottom line:
Text on screen: TITLE - Why PIMCO for Balanced?; The main portion of the slide features three circular icons, each paired with descriptive text: Left circle (blue): Icon: A pie chart divided into sections. Text below: “Comprehensive 60/40 Solution.” Middle circle (green): Icon: A price tag symbol. Text below: “Cost-Effective Approach.” Right circle (purple): Icon: A stylized hand holding upward‑pointing bar shapes. Text below: “PIMCO Advantage.” Beneath these icons, there is a horizontal table‑style strip with three labeled boxes: Series ETF Line: TSX: PBAL Fee shown: 29 bps* Series F Line: PMO219 Fee shown: 29 bps* Series A Line: PMO019 Fee shown: 129 bps* At the bottom, the slide includes fine‑print disclosure text explaining the management fee rates and noting that additional third‑party fund fees may apply. There is also a note indicating that PIMCO Canada expects the total fees to be approximately 0.70% of the fund’s net asset value.
You get the simplicity of a balanced fund — but active where it matters and passive where it saves. And with the power of PIMCO behind it.
Lastly we wanted to touch on how investors may consider using PBAL:
First: a potential replacement or enhancement for traditional balanced funds or ETF portfolios.
For investors currently in traditional higher cost balanced funds or passive ETF models, PBAL may offer a more thoughtful implementation at a competitive cost.
Second: Think of PBAL’s approach as potentially providing greater stability during uncertain times.
In an environment of heightened market uncertainty, PBAL seeks to provide stability with broad market exposure and automatic rebalancing that can help mitigate uncertainty about which market sectors might be winners or losers based on the latest headlines.
Across all use cases, the common theme is simplicity without giving up sophistication. PBAL aims to provide diversified exposure to global stocks and bonds, automatic rebalancing, and access to PIMCO’s global resources — all in one single cost effective portfolio.
Text on screen: For more insights and information visit pimco.com
Text on screen: PIMCO
Disclosure
No offering is being made by this material. Commissions, trailing commissions, management fees and expenses all may be associated with mutual fund investments. Please read the prospectus before investing. Mutual funds are not guaranteed, their values change frequently and past performance may not be repeated.
Non-PIMCO funds and/or Exchange Traded Funds (“ETFs”) mentioned within are not offered by PIMCO Canada Corp. and are offered by prospectus only.
There is no guarantee that these investment strategies will work under all market conditions or are appropriate for all investors and each investor should evaluate their ability to invest long-term, especially during periods of downturn in the market.
The Portfolio's Strategic Allocation is set annually and serves as the home base for the period. A Portfolio's Strategic Allocation is subject to review on a defined schedule and may vary within the Portfolio's Allocation Range ('Current Target') within the annual period. Allocation range is how PIMCO intends to allocate the portfolio, actual allocations may be higher or lower. A Portfolio's actual allocation will vary from both its Strategic Allocation and Current Target. Each Fund is actively managed and will seek to achieve its investment objectives by selecting underlying PIMCO funds that primarily invest in fixed-income securities and 3rd party funds that primarily invest in equity securities to construct a portfolio that is diversified across sectors, geographies, maturities and credit quality among other relevant factors. Each Fund allocates and rebalances across the underlying funds based on PIMCO's assessment of markets and the underlying funds' ability to help the Fund meet its stated investment objectives. Accordingly, the Funds actual asset allocations as well as its allocation ranges, may differ from those shown. The information outlined is not an indication of the historical or future allocations of the Funds nor the ranges in which the Funds' investments will be allocated. Allocations and allocation ranges should not be relied upon as an indicator of future results or used as the basis for investment decisions.
Portfolio structure is subject to change without notice and may not be representative of current or future allocations.
It is not possible to invest directly in an unmanaged index.
The funds invest in other PIMCO funds and performance is subject to underlying investment weightings which will vary. Investing in the bond market is subject to risks, including market, interest rate, issuer, credit, inflation risk, and liquidity risk. The value of most bonds and bond strategies are impacted by changes in interest rates. Bonds and bond strategies with longer durations tend to be more sensitive and volatile than those with shorter durations; bond prices generally fall as interest rates rise, and low interest rate environments increase this risk. Reductions in bond counterparty capacity may contribute to decreased market liquidity and increased price volatility. Bond investments may be worth more or less than the original cost when redeemed. Currency rates may fluctuate significantly over short periods of time and may reduce the returns of a portfolio. Equities may decline in value due to both real and perceived general market, economic and industry conditions. Sovereign securities are generally backed by the issuing government. Obligations of U.S. government agencies and authorities are supported by varying degrees, but are generally not backed by the full faith of the U.S. government. Portfolios that invest in such securities are not guaranteed and will fluctuate in value. High yield, lower-rated securities involve greater risk than higher-rated securities; portfolios that invest in them may be subject to greater levels of credit and liquidity risk than portfolios that do not. Derivatives and commodity-linked 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. 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There is a risk that the fund or ETF’s performance may not track the performance of the index it is designed to track because, unlike the index, the fund or ETF incurs administrative expenses and transaction costs in trading securities. In addition, the timing and magnitude of cash inflows and outflows from and to investors buying and redeeming shares in the fund or ETF could create cash balances that cause the fund or ETF’s performance to deviate from the index (which remains “fully invested” at all times). Finally, performance of a fund or ETF and the index it is designed to track also may diverge because the composition of the index and the securities held by the fund or ETF may occasionally differ. Also, a fund or ETF, in tracking the performance of the index, may have more of its assets concentrated in one or more issuers than would ordinarily be permitted by a mutual fund. In addition, prices of securities on an index tend to move together. Such concentration means that the fund or ETF may be more volatile than a more diversified fund. Finally, if required to follow an index, a fund or ETF must continue to invest in the securities of the index, regardless of the performance of the index, so the fund or ETF cannot reduce risk by investing in securities on another index. The value of a security may decline for a number of reasons which directly relate to the issuer, such as management performance, financial leverage and reduced demand for the issuer’s goods or services, as well as the historical and prospective earnings of the issuer and the value of its assets. Liquidity is a measure of how quickly an investment can be sold for cash at a fair market price. If the Fund can’t sell an investment quickly, it may lose money or make a lower profit, especially if it has to meet a large number of redemption requests. In general, investments in smaller companies, smaller markets or certain sectors of the economy tend to be less liquid than other types of investments. The less liquid an investment, the more its value tends to fluctuate. Liquidity risk exists when particular investments are difficult to purchase or sell. Illiquid securities are securities that cannot be readily disposed of through market facilities on which public quotations in common use are widely available at an amount that at least approximately the value at which the Fund has valued the securities or which are otherwise subject to legal or contractual restrictions on resale. The Fund’s investments in illiquid securities may reduce the returns of the Fund because it may be unable to sell the illiquid securities at an advantageous time or price. Additionally, the market for certain investments may become illiquid under adverse market or economic conditions independent of any specific adverse changes in the conditions of a particular issuer. In such cases, the Fund, due to limitations on investments in illiquid securities and the difficulty in purchasing and selling such securities or instruments, may be unable to achieve its desired level of exposure to a certain sector. To the extent that the Fund’s principal investment strategies involve foreign (non-Canadian or U.S.) securities, derivatives or securities with substantial market and/or credit risk, the Fund will tend to have the greatest exposure to liquidity risk. The Fund may invest up to 10% of its net assets in illiquid securities. Certain illiquid securities may require pricing at fair value. A portfolio manager may be subject to significant delays in disposing of illiquid securities, and transactions in illiquid securities may entail prospectus expenses and other transaction costs that are higher than those for transactions in liquid securities. Restricted securities, i.e., securities subject to legal or contractual restrictions on resale, may be illiquid. If the Fund invests in real estate-linked derivative instruments is subject to risks similar to those associated with direct ownership of real estate, including losses from casualty or condemnation, and changes in local and general economic conditions, supply and demand, interest rates, zoning laws, regulatory limitations on rents, property taxes and operating expenses. 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