What is StocksPLUS® Absolute Return?
StocksPLUS Absolute Return is an innovative equity strategy that capitalizes on long-term investor horizons and PIMCO’s two decades of experience managing StocksPLUS and 40+ years of experience of actively managing fixed income portfolios. The goal of StocksPLUS Absolute Return is to consistently deliver attractive excess returns relative to a given equity index over three- to five-year time horizons.
The StocksPLUS Absolute Return strategy uses equity index futures and sometimes swaps to achieve non-leveraged passive stock market exposure thereby eliminating the risk of underperformance due to adverse stock selection relative to the index. As equity index ownership using futures and swaps typically only requires a very modest initial cash outlay, PIMCO invests the remaining cash in an actively managed absolute return style fixed income portfolio with the goal of outperforming the money market interest rate cost typically associated with equity index futures and swap ownership. If the underlying fixed income portfolio outperforms money market rates, in most cases the StocksPLUS Absolute Return strategy should deliver before fee excess returns.
We offer a variety of domestic, regional and international equity indexes in most developed markets as depicted below. Other indexes, such as emerging markets, may be considered, please feel free to inquire.