Extended Duration Fund


Updated May 29, 2020


Seeks maximum total return, consistent with prudent investment management

Primary Portfolio

Long-term maturity fixed income securities



Fund Overview

A long-duration, core bond fund

PIMCO Extended Duration Fund is a core bond investment that provides broad market exposure to high-quality, long-dated fixed income securities. Following PIMCO’s signature total return philosophy and process, it employs a variety of strategies to enhance return potential and manage overall portfolio risk.

Why Invest In This Fund

Enhanced exposure to interest rate trends

The Fund invests in a diversified portfolio of long-duration bonds, with an average duration that normally varies within three years (plus or minus) of the Citigroup Strips Index, 20+ Year Sub-Index. Duration is a measure of a security’s price sensitivity to interest rate changes, measured in years; a longer duration implies greater interest rate sensitivity and return potential than intermediate- or short-term bonds, but also greater volatility. The Fund can be used as a core holding for investors with a higher risk tolerance, or as an allocation to position a portfolio for expected interest rate trends.

Value-added active management

We seek to add value through active management of the Fund. The portfolio is well-diversified, with flexibility to invest across sectors and issuers. Although the Fund is subject to greater interest rate risk than shorter-duration funds, it strives to limit this risk by maintaining the portfolio’s duration within a moderate range around the benchmark’s duration. The Fund employs PIMCO’s total return philosophy, seeking to balance capital appreciation potential and income.

Duration management expertise

PIMCO, a leading fixed income asset manager, combines various measures to assess the interest rate risk to which a longer duration portfolio may be subjected. Our extensive internal modeling addresses duration in its many forms: bull and bear durations (rate shifts of given amounts); total curve durations (changing yield curve shapes); credit spread durations; and mortgage spread and prepayment durations. Our firm-wide macroeconomic outlook, which forecasts the forces likely to impact fixed income markets over the short and long term, likewise helps drive our duration strategies.


FTSE STRIPS Index, 20+ Year Sub-Index


FTSE STRIPS Index, 20+ Year Sub-Index represents a composition of outstanding Treasury Bond and Notes with a maturity of at least twenty years. The index is rebalanced each month in accordance with underlying Treasury figures and profiles provided as of the previous month- end. The included STRIPS are derived only from bonds in the FTSE U.S. Treasury Bond Index, which include coupon strips with less than one year remaining to maturity. It is not possible to invest directly in an unmanaged index.


Monthly with Daily Accrual






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Mike Cudzil

Portfolio Manager, Liability-Driven Investment

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Steve A. Rodosky

Portfolio Manager, Real Return and Long Duration

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Yields & Distributions