Past performance is not a guarantee or a reliable indicator of future results. A
portfolios may not necessarily fully participate in strong (positive) market rallies. 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. Investing in securities of smaller companies tends to be more
volatile and less liquid than securities of larger companies. Equities may decline in value due to both real and perceived general market,
economic, and industry conditions. 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.
The credit quality of a particular security or group of securities does not ensure the stability or safety of an overall portfolio. The quality ratings of
individual issues/issuers are provided to indicate the credit-worthiness of such issues/issuer and generally range from AAA, Aaa, or AAA (highest) to D, C,
or D (lowest) for S&P, Moody’s, and Fitch respectively. No representation is being made that any account, product, or strategy will or is likely to
achieve profits, losses, or results similar to those shown. Hypothetical or simulated performance results have several inherent limitations. Unlike an
actual performance record, simulated results do not represent actual performance and are generally prepared with the benefit of hindsight. There are
frequently sharp differences between simulated performance results and the actual results subsequently achieved by any particular account, product or
strategy. In addition, since trades have not actually been executed, simulated results cannot account for the impact of certain market risks such as lack
of liquidity. There are numerous other factors related to the markets in general or the implementation of any specific investment strategy, which cannot be
fully accounted for in the preparation of simulated results and all of which can adversely affect actual results.
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.
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. The MSCI World Index is a free float-adjusted market
capitalization weighted index that is designed to measure the equity market performance of developed markets. The MSCI World Index consists of the
following 24 developed market country indices: Australia, Austria, Belgium, Canada, Denmark, Finland, France, Germany, Greece, Hong Kong, Ireland, Israel,
Italy, Japan, Netherlands, New Zealand, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, the United Kingdom, and the United States. The PIMCO Global Advantage Bond Index (GLADI) is a diversified global index that covers a wide spectrum of global fixed income opportunities
and sectors, from developed to emerging markets, nominal to real assets, and cash to derivative instruments. Unlike traditional indices, which are
frequently comprised of bonds weighted according to their market capitalization, GLADI uses GDP-weighting which puts an emphasis on faster-growing areas of
the world and thus makes the index forward-looking in nature. PIMCO’s GLADI methodology is intellectual property covered by U.S. Patent No. 8,306,892.
GLOBAL ADVANTAGE and GLADI are trademarks of Pacific Investment Management Company LLC. The S&P 500 Index is an unmanaged market index
generally considered representative of the stock market as a whole. The index focuses on the Large-Cap segment of the U.S. equities market.
This material contains the opinions of the author but not necessarily those of PIMCO 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. 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 and YOUR GLOBAL INVESTMENT
AUTHORITY are trademarks or registered trademarks of Allianz Asset Management of America L.P. and Pacific Investment Management Company LLC, respectively,
in the United States and throughout the world. ©2014, PIMCO.