Performance

Outperformance Through Up and Down Markets

PIMCO Total Return Fund has outperformed both its benchmark and its peer group average since its launch in 1987 across varying markets and interest rate environments. The fund aims to serve as an anchor of stability within a broad investment portfolio no matter which way the markets move. The PIMCO Total Return team was honored to have been nominated for Morningstar 2017 U.S. Fixed-Income Fund Manager of the Year.

[Growth of 10K]

A Legacy of Outperformance

Average annual returns % as of 3/31/18 1YR 3YR 5YR 10YR SINCE INCEPTION
(5/11/1987)
PIMCO Total Return Fund Institutional Shares 2.13% 1.62% 1.83% 4.75% 7.22%
Bloomberg Barclays U.S. Aggregate Index 1.20% 1.20% 1.82% 3.63% 6.25%
Category 1.31% 1.27% 1.73% 3.80% 6.02%
As of 31 March 2018. SOURCE: PIMCO, Bloomberg, Morningstar Direct. Category is the Morningstar intermediate-term bond category average.
Performance displayed is for the institutional class shares net of fees.

Total Expense Ratio: 0.51%


Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Current performance may be lower or higher than performance shown. For performance current to the most recent month-end, visit www.pimco.com or call (888) 87-PIMCO.

Key Benefits

A Focus on Delivering the True Value of Core

PIMCO Total Return Fund leverages the firm’s time-tested investment process, vast global resources and expertise of three industry-renowned portfolio managers to actively seek diverse sources of returns from higher-quality, intermediate term bonds. A true core bond solution, the fund aims to deliver the portfolio stability and resilience that investors need to meet their long-term goals.

Positioned to Minimize Risk

The fund’s maximum drawdown over the last 10 years is only half of its average peer.

[Drawdown]

Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Current performance may be lower or higher than performance shown. For performance current to the most recent month-end, visit www.pimco.com or call (888) 87-PIMCO.

As of 31 March 2018. SOURCE: Morningstar, PIMCO.
Performance displayed is for the institutional class shares net of fees.
Fund percentile rankings: 1 Yr. 161 (999 investments ranked); 3 Yrs. 242 (858 investments ranked) 5 Yrs. 328 (784 investments ranked); 10 Yrs. 55 (561 investments ranked).
‘All Peers’ and ‘Current Top Quartile’ performance reflects performance of funds in the Morningstar intermediate-term bond category, excluding the PIMCO Total Return Fund

Strong Performance in Weak Markets

The fund had the highest average monthly return relative to peers in months when equities sold off.

[Strong Performance in Weak Markets]

Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Current performance may be lower or higher than performance shown. For performance current to the most recent month-end, visit www.pimco.com or call (888) 87-PIMCO.

As of 31 March 2018. SOURCE: Morningstar, PIMCO.
Performance displayed is for the institutional class shares net of fees.
Equities are represented by the S&P 500 Total Return Index. Peer group based on all share classes of funds in Morningstar’s OE Intermediate-Term Bond Category. The current top quartile reflects those share classes currently in the top quartile based on three-year returns. Monthly returns are calculated from January 1994.
*The worst equity returns are identified as the worst 25% of months with negative S&P 500 returns
Fund percentile rankings: 1 Yr. 161 (999 investments ranked); 3 Yrs. 242 (858 investments ranked) 5 Yrs. 328 (784 investments ranked); 10 Yrs. 55 (561 investments ranked).
‘All Peers’ and ‘Current Top Quartile’ performance reflects performance of funds in the Morningstar intermediate-term bond category, excluding the PIMCO Total Return Fund

An Active Advantage

The fund has provided both a higher return and a better risk-adjusted return than its peers and its benchmark.

An Active AdvantageAn Active Advantage

Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Current performance may be lower or higher than performance shown. For performance current to the most recent month-end, visit www.pimco.com or call (888) 87-PIMCO.

As of 31 March 2018. SOURCE: Morningstar, PIMCO.
Performance displayed is for the institutional class shares net of fees.
Fund percentile rankings: 1 Yr. 161 (999 investments ranked); 3 Yrs. 242 (858 investments ranked) 5 Yrs. 328 (784 investments ranked); 10 Yrs. 55 (561 investments ranked).
‘All Peers’ and ‘Current Top Quartile’ performance reflects performance of funds in the Morningstar intermediate-term bond category, excluding the PIMCO Total Return Fund

Manager Insights

A Solid Foundation for Uncertain Markets

With key risks on the horizon, portfolio defense may be more important than ever. The portfolio managers behind PIMCO Total Return offer an inside look at the process that has fueled the core bond strategy for decades - and how they are managing the strategy to prepare for what's ahead.

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 or by visiting www.pimco.com. Please read them carefully before you invest or send money.

Past performance is not a guarantee or a reliable indicator of future results. The performance figures presented reflect the total return performance and reflect changes in share price and reinvestment of dividend and capital gain distributions. All periods longer than one year are annualized. The minimum initial investment for Institutional class shares is $1 million; however, it may be modified for certain financial intermediaries who submit trades on behalf of eligible investors.

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.

Differences in the Fund’s performance versus the index and related attribution information with respect to particular categories of securities or individual positions may be attributable, in part, to differences in the pricing methodologies used by the Fund and the index.

There is no assurance that any fund, including any fund that has experienced high or unusual performance for one or more periods, will experience similar levels of performance in the future. High performance is defined as a significant increase in either 1) a fund’s total return in excess of that of the fund’s benchmark between reporting periods or 2) a fund’s total return in excess of the fund’s historical returns between reporting periods. Unusual performance is defined as a significant change in a fund’s performance as compared to one or more previous reporting periods.

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 the current low interest rate environment increases this risk. Current 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. 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. 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 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.  Diversification does not ensure against loss.

There is no guarantee that these investment strategies will work under all market conditions or are suitable for all investors and each investor should evaluate their ability to invest long-term, especially during periods of downturn in the market. Investors should consult their investment professional prior to making an investment decision.

Bloomberg Barclays U.S. Aggregate Index represents securities that are SEC-registered, taxable and dollar-denominated. 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. These major sectors are subdivided into more specific indices that are calculated and reported on a regular basis. It is not possible to invest directly in an index.

Morningstar Ranking estimates for the Morningstar U.S. OE Intermediate-Term Bond Category for the Institutional class shares; other classes may have different performance characteristics. The Morningstar Rankings are calculated by Morningstar and are based on the total return performance, with distributions reinvested and operating expenses deducted. Morningstar does not take into account sales charges. Past rankings are no guarantee of future rankings.

Morningstar RatingTM as of 30 April 2018 for the institutional class shares; other classes may have different performance characteristics. The PIMCO Total Return Fund was rated against the following numbers of intermediate-term bond funds over the following time periods: Overall 4 Stars (863 funds rated); 3 Yrs. 4 Stars (863 funds rated); 5 Yrs. 3 Stars (783 funds rated); 10 Yrs. 4 stars (560 funds rated). Past performance is no guarantee of future results. The Morningstar RatingTM for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods. A rating is not a recommendation to buy, sell or hold a fund. Morningstar, Inc.® 2018. All rights reserved. The information contained herein: (1) is proprietary to Morningstar (2) may not be copied or distributed and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.

The Morningstar U.S. Fixed Income Manager of the Year award is based on the strength of the manager, performance, strategy and firm’s stewardship.

The Morningstar Analyst RatingTM is not a credit or risk rating. It is a subjective evaluation performed by Morningstar’s manager research group, which consists of various Morningstar, Inc. subsidiaries (“Manager Research Group”). In the United States, that subsidiary is Morningstar Research Services LLC, which is registered with and governed by the U.S. Securities and Exchange Commission. The Manager Research Group evaluates funds based on five key pillars, which are process, performance, people, parent, and price. The Manager Research Group uses this five pillar evaluation to determine how they believe funds are likely to perform relative to a benchmark, or in the case of exchange-traded funds and index mutual funds, a relevant peer group, over the long term on a risk-adjusted basis. They consider quantitative and qualitative factors in their research, and the weight of each pillar may vary. The Analyst Rating scale is Gold, Silver, Bronze, Neutral, and Negative. A Morningstar Analyst Rating of Gold, Silver, or Bronze reflects the Manager Research Group’s conviction in a fund’s prospects for outperformance. Analyst Ratings ultimately reflect the Manager Research Group’s overall assessment, are overseen by an Analyst Rating Committee, and are continuously monitored and reevaluated at least every 14 months. For more detailed information about Morningstar’s Analyst Rating, including its methodology, please go to global.morningstar.com/managerdisclosures/.

The Morningstar Analyst Rating (i) should not be used as the sole basis in evaluating a fund, (ii) involves unknown risks and uncertainties which may cause Analyst expectations not to occur or to differ significantly from what they expected, and (iii) should not be considered an offer or solicitation to buy or sell the fund.

© 2018 Morningstar, Inc. All Rights Reserved. The information contained herein: (1) is proprietary to Morningstar; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.

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 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. PIMCO is a trademark of Allianz Asset Management of America L.P. in the United States and throughout the world. ©2018, PIMCO

PIMCO Investments LLC, distributor, 1633 Broadway, New York, NY 10019, is a company of PIMCO.

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