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Market Volatility: Resources for Advisors

Tools to help you stay current, engage clients and invest in changing markets.

Market Update and Insights

COVID-19 Market Update – Wednesday, July 1st

  1. Risk markets were mixed to start the third quarter: U.S. equities edged higher amidst improving U.S. economic data (U.S. manufacturing / private sector payrolls) and vaccine developments in Germany. Credit spreads were generally tighter globally while sovereign yields drifted higher. However, sentiment in Europe broadly soured on increasing unemployment rates in the EU
  2. Fed meeting minutes indicated a willingness to provide explicit forward guidance in policy rates and asset purchases to better facilitate an economic recovery. Committee members also reiterated that adverse developments stemming from trade tensions or COVID-19 remained key risks – the latter was particularly evident on the day as several U.S. states (California, Texas, and Arizona) all reported record increases in cases

Latest Insights

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Five Characteristics of a Post-COVID World   Video

Five Characteristics of a Post-COVID World(video)

Big macro events tend to accelerate trends that were already in place, so what will be accelerated by the current crisis? Joachim Fels, Global Economic Advisor, discusses five trends that will likely become characteristics of the post-COVID world.

The Long Climb to Recovery   Video

The Long Climb to Recovery(video)

There are several reasons a full recovery may take until 2022. Joachim Fels, global economic advisor, and Anmol Sinha, fixed income strategist, explain the factors that could push our baseline outlook into a good or bad scenario.

Straight From PIMCO: 3 Stages of Distress in Commercial Real Estate   Video

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Featured Update

What’s Ahead for the Economy and Markets: Key Highlights

Group CIO Dan Ivascyn provides a quick overview of PIMCO’s macroeconomic outlook and the implications for financial markets.

Full webcast replay

Guiding Your Clients Through Turbulent Markets

Assessing Risk and Allocating Capital: A Framework for Clients

Assessing Risk and Allocating Capital: A Framework for Clients

We anticipate a phased but bumpy recovery that plays to the strengths of active management.

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Five Accelerating Trends in Wealth Management our Clients Should Know About

The COVID-19 pandemic is having a massive impact on global health, economic growth and the financial markets. It’s also accelerating five important trends in the U.S. wealth management market. Here’s how our clients are adapting to both the current challenges and changing landscape.

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Financial Planning Strategies During a Volatile Market

Recent market volatility has created anxiety among many investors who have endured a marked reduction in their portfolio values and emotional duress. Clients are turning to their financial advisors for investment guidance to ensure that their portfolios are correctly positioned to achieve their personal objectives, given the current market environment.

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Volatility Checklist

Our volatility checklist can help you re-focus your clients on what's likely to have the greatest impact on their financial success: maintaining a longer-term perspective, being thoughtful about portfolio allocation, understanding risk exposures and minimizing costs and taxes.

For AdvisorsFor Investors

The Value of Professional Advice

Despite efforts to keep clients focused on the long-term, when markets decline significantly, emotions tend to take over and investors may be tempted to react, especially after seeing reduced portfolio values. Use our handout to help manage your client behaviors to maintain discipline.

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What the IRS Payment Extension Means

The U.S. Treasury announced a plan to delay the collection of tax payments. Learn more about the details of this plan and what it means for your clients.

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The CARES Act: What Advisors Need to Know

In March 2020, Congress passed the Coronavirus Aid, Relief and Economic Security (CARES) Act with a primary focus on providing liquidity to financial markets, industries and state and local governments.

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The Benefits of Staying Invested

Sometimes volatile markets and our emotions can get the better of us, leading investors to buy out of excitement or sell out of fear. Ultimately, though, when markets normalize, we need to be positioned to benefit, and we believe that means staying invested.

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Recognizing Investor Biases

Behavioral science tells us that when it comes to making decisions, we’re much less rational than we think. Understanding these key concepts in behavioral science can help your clients keep their emotions in check, make better decisions and achieve superior investment outcomes.

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Behavioral Science in Uncertain Times

During periods of extreme market volatility, investors often focus on short-term returns not long-term goals. Learn how advisors can help reduce negative consequences of emotional decision making by providing valuable guidance in this video.

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Behavioral Science Guide: Volatility Edition

Our reference guide provides common investment-related biases and outlines some implications of these biases on decision making. It also shares questions and thought-starters to financial advisors as they help clients identify those biases and mitigate negative outcomes.

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The What, Why and How of Investing During Market Volatility

This investor-friendly series is designed to help your clients make sense of the markets and investing during this challenging period.

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Product & Strategy Updates

Market Volatility Media Center 
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Straight From PIMCO: Core Bonds in Focus   Video
Straight from PIMCO: Target Date Funds and Volatility   Video

Straight from PIMCO: Target Date Funds and Volatility(video)

Portfolio manager Erin Browne discusses the impact of recent market volatility on target date funds, with a focus on vintages closest to retirement. She also looks at what’s ahead for retirement investors, and how plan sponsors and advisors can help participants navigate uncertainty.

PIMCO’s Process in Times of Crisis   Video

PIMCO’s Process in Times of Crisis(video)

During periods of volatility, our disciplined investment process becomes even more centralized and coordinated, leveraging multiple checks and balances to ensure that we are laser focused on our one priority: working to protect our clients’ capital.

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Disclosures

Sources: Bloomberg; US IG Spreads: Bloomberg Barclays US Agg; US Credit Spreads: Bloomberg Barclays US Agg Credit; US HY Spreads: Bloomberg Barclays HY US Corporate; EM equities: MSCI EM; EM debt: JPM EMBI; Munis: Bloomberg Barclays Municipal Bond

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. Click here for a complete list of the PIMCO Funds prospectuses and summary prospectuses. Please read them carefully before you invest or send money.

Statements concerning financial market trends are based on current market conditions, which will fluctuate. This material is distributed for informational purposes only and should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. It is not possible to invest directly in an unmanaged index. Information contained herein has been obtained from sources believed to be reliable, but not guaranteed.

The issuers referenced are examples of issuers PIMCO considers to be well known and that may fall into the stated sectors. References to specific issuers are not intended and should not be interpreted as recommendations to purchase, sell or hold securities of those issuers. PIMCO products and strategies may or may not include the securities of the issuers referenced and, if such securities are included, no representation is being made that such securities will continue to be included.

All investments contain risk and may lose value. 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. Commodities contain heightened risk, including market, political, regulatory and natural conditions, and may not be suitable for all investors. Equities may decline in value due to both real and perceived general market, economic and industry conditions. 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. 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 while generally supported by a government, government-agency or private guarantor, there is no assurance that the guarantor will meet its obligations. Income from municipal bonds in the United States is exempt from federal income tax and may be subject to state and local taxes and at times the alternative minimum tax. Investors should consult their investment professional prior to making an investment decision.

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. 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. Inflation-linked bonds (ILBs) issued by a government are fixed-income securities whose principal value is periodically adjusted according to the rate of inflation; ILBs decline in value when real interest rates rise. Certain U.S. Government securities are backed by the full faith of the 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. 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. 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. Equities may decline in value due to both real and perceived general market, economic, and industry conditions. 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. Commodity-linked derivative instruments may involve additional costs and risks such as changes in commodity index volatility or factors affecting a particular industry or commodity, such as drought, floods, weather, livestock disease, embargoes, tariffs and international economic, political and regulatory developments. 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.

Buying or selling ETF shares on an exchange may require the payment of brokerage commissions. Due to the costs inherent in buying or selling Fund shares, frequent trading may detract significantly from investment returns. Investment in Fund shares may not be advisable for investors who expect to engage in frequent trading. Different fund types (e.g. ETFs, open-ended investment companies) and fund share classes are subject to different fees and expenses (which may affect performance). They may also have different minimum investment requirements and be entitled to different services. Current holdings are subject to risk. Holdings are subject to change at any time. An investment in an ETF involves risk, including the loss of principal. Investment return, price, yield and Net Asset Value (NAV) will fluctuate with changes in market conditions. Investments may be worth more or less than the original cost when redeemed.

Model portfolios are available only through a financial adviser.

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. ©2020, PIMCO

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

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