Low Duration Income Fund

PLDCX

Updated November 30, 2020

Objective

The Fund’s primary investment objective is to maximize current income.  Long-term capital appreciation is a secondary objective.

Primary Portfolio

Global opportunity set of fixed income securities (duration varies from 0 to 3 years)

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Overview

Fund Overview

Seeks to generate income with low interest rate exposure

Designed for investors who need steady income with low interest rate exposure, the fund takes a broad-based approach to investing in income-generating bonds. It employs PIMCO’s vast analytical capabilities and sector expertise to help temper the risks of income investing.

Why Invest In This Fund

Pursues income across global fixed income sectors

The global economic landscape is constantly changing, causing different bond sectors to go in and out of favor. The fund’s multi-sector approach allows it to seek out the best income-generating ideas in any market climate, targeting multiple sources of income and low interest rate exposure from a global opportunity set.

Total return approach to generating income

While generating attractive current income is a primary goal, the fund also seeks long-term capital appreciation and compelling risk-adjusted returns with a low duration level. The fund also aims to preserve capital, maintain quality and lower interest rate risk.

Ability to be opportunistic

The fund can tactically shift portfolio weights, moving to wherever attractive yields can be generated with low interest rate sensitivity in an increasingly complex and volatile investment environment. This flexibility helps the fund to nimbly capture opportunities as economic and market conditions change.

Our Expertise

The fund is managed by an expert team of veteran global income investors: Dan Ivascyn and Alfred Murata were named Morningstar’s 2013 U.S. Fixed Income Fund Managers of the Year for PIMCO Income Fund; Eve Tournier, Head of Pan-European Credit Portfolio Management, is the lead portfolio manager for the firm’s dedicated European income-oriented strategies and global multi-sector credit strategies. The team draws on PIMCO’s time-tested investment process: our rigorously developed global macro outlook, bottom-up credit analysis and research teams’ deep reservoir of specialized investment expertise.

PRIMARY BENCHMARK

Bloomberg Barclays U.S. Aggregate 1-3 Years Index

PRIMARY BENCHMARK DESCRIPTION

Bloomberg Barclays U.S. Aggregate 1-3 Years Index represents securities that are SEC-registered, taxable, and dollar denominated with a maturity between one and three years. The index covers the U.S. investment grade fixed rate bond market, with index components for government and corporate securities, mortgage pass-through securities, and asset-backed securities. It is not possible to invest directly in an unmanaged index.

DIVIDEND FREQUENCY

Monthly with Daily Accrual

SHARE CLASS INCEPTION

10/21/2020

CUSIP

72201U133

RELATED

Amid ongoing uncertainty in the global economy, we believe flexibility and active investment management are critical for fixed income strategies.

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Managers

Daniel J. Ivascyn

Group Chief Investment Officer

View Profile for Daniel J. Ivascyn

Alfred T. Murata

Portfolio Manager, Mortgage Credit

View Profile for Alfred T. Murata

Eve Tournier

Head of European Credit Portfolio Management

View Profile for Eve Tournier

Fees & Expenses

Effective as of 10/21/2020
Gross Expense Ratio 1.45%
Adjusted Expense Ratio 1.41%
The Adjusted Expense Ratio excludes certain investment expenses, such as interest expense from borrowings and repurchase agreements and dividend expense from investments on short sales, incurred directly by the Fund or indirectly through the Fund’s investments in underlying PIMCO Funds (if applicable), none of which are paid to PIMCO.

Portfolio Composition

All data as of unless otherwise stated

Maturity %

0-1 yrs 35.52
1-3 yrs 34.16
3-5 yrs 25.45
5-10 yrs 14.97
10-20 yrs -9.10
20+ yrs -1.00
Effective Maturity (yrs) 1.92

Sector Allocation
Market Value %

US Government Related1 -18.89
Securitized2 65.47
Invest. Grade Credit 17.52
High Yield Credit 10.98
Non-USD Developed 7.24
Emerging Markets3 10.27
Other4 2.49
Net Other Short Duration Instruments5 4.91

Duration in Years

Effective Duration (yrs) 1.23

disclosures

1May include nominal and inflation-protected Treasuries, Treasury futures and options, agencies, FDIC-guaranteed and government-guaranteed corporate securities, and interest rate swaps.
2The Securitized bucket will include Agency MBS, non-Agency MBS, CMBS, ABS, CDO, CLO, and Pooled Funds.
3Short duration emerging markets instruments includes an emerging market security or other instrument economically tied to an emerging market country by country of risk with an effective duration less than one year and rated investment grade or higher or if unrated, determined to be similar quality by PIMCO. Emerging Markets includes the value of short duration emerging markets instruments previously reported in another category.
4May include municipals, convertibles, preferreds, and yankee bonds.
5Net Other Short Duration Instruments includes securities and other instruments (except those instruments tied to emerging markets by country of risk) with an effective duration less than one year and rated investment grade or higher or, if unrated, determined by PIMCO to be of comparable quality, commingled liquidity funds, uninvested cash, interest receivables, net unsettled trades, broker money, short duration derivatives and derivatives offsets. With respect to certain categories of short duration securities, the Adviser reserves the discretion to require a minimum credit rating higher than investment grade or take into account other pertinent factors for inclusion in this category. Derivatives Offsets includes offsets associated with investments in futures, swaps and other derivatives. Such offsets may be taken at the notional value of the derivative position.
Portfolio information in the charts is based on the fund's net assets. These percentages may differ from those used for the fund's compliance calculations, including the fund's prospectus, regulatory, and other investment limitations and policies, which may be based on total assets of the fund or other measurements, may include or exclude various categories of investments from those covered in the portfolio allocation categories shown in this report, and may be based on different classifications and measurements of the fund’s investments and other criteria.
References to specific sectors, securities or issuers are for illustrative purposes only. All holdings are subject to change daily. All share classes have the same portfolio but different expenses.
Duration is a measure of a portfolio’s price sensitivity expressed in years. Effective duration is the duration for a bond with an embedded option when the value is calculated to include the expected change in cash flow caused by the option as interest rates change.

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Disclosures

Investors should consider the investment objectives, risks, charges and expenses of the funds carefully before investing. This and other information are contained in the fund’s prospectus and summary prospectus, if available, which may be obtained by contacting your investment professional or PIMCO representative.  Please read them carefully before you invest or send money.
A word about risk:

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. Investing in foreign-denominated and/or -domiciled securities may involve heightened risk due to currency fluctuations, and economic and political risks, which may be enhanced in emerging markets. 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. Equities may decline in value due to both real and perceived general market, economic and industry conditions. 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. Mortgage- and asset-backed securities may be sensitive to changes in interest rates, subject to early repayment risk, and their value may fluctuate in response to the market’s perception of issuer creditworthiness; while generally supported by some form of government or private guarantee, there is no assurance that private guarantors will meet their obligations. Diversification does not ensure against loss.
Investments made by a Fund and the results achieved by a Fund are not expected to be the same as those made by any other PIMCO-advised Fund, including those with a similar name, investment objective or policies. A new or smaller Fund’s performance may not represent how the Fund is expected to or may perform in the long-term. New Funds have limited operating histories for investors to evaluate and new and smaller Funds may not attract sufficient assets to achieve investment and trading efficiencies. A Fund may be forced to sell a comparatively large portion of its portfolio to meet significant shareholder redemptions for cash, or hold a comparatively large portion of its portfolio in cash due to significant share purchases for cash, in each case when the Fund otherwise would not seek to do so, which may adversely affect performance.
PIMCO as a general matter provides services to qualified institutions, financial intermediaries and institutional investors. Individual investors should contact their own financial professional to determine the most appropriate investment options for their financial situation. This material contains the current opinions of the manager and such opinions are subject to change without notice. This material has been distributed for informational purposes only. Information contained herein has been obtained from sources believed to be reliable, but not guaranteed. No part of this material may be reproduced in any form, or referred to in any other publication, without express written permission. PIMCO is a trademark of Allianz Asset Management of America L.P. in the United States and throughout the world. ©2020, PIMCO
PIMCO Investments LLC, distributor, 1633 Broadway, New York, NY 10019, is a company of PIMCO.
CMR2020-1019-1371608