PIMCO adds a new ETF to its suite of actively managed fixed income securities
NEWPORT BEACH, Calif., June 09, 2022 (GLOBE NEWSWIRE) — PIMCO, one of the world’s leading bond investment managers, is expanding its lineup of actively managed bond exchange-traded funds with the addition of a new ETF that could help diversify fixed income allocations for investors concerned about rising rates.
The PIMCO Senior Loan Active Exchange-Traded Fund (LONZ) aims to find attractive opportunities in the senior loan market where investments can offer floating interest rates that can help mitigate the negative impact of rising rates on an investment portfolio. With more than 80 credit analysts at PIMCO supporting our loan-focused portfolio management team, PIMCO will seek to select investments with the aim of prudently managing credit risk while helping investors achieve their investment objectives. long-term.
The ETF will be managed by David Forgash, Executive Vice President and Head of PIMCO’s Global Leveraged Loan Portfolio Management Team; Giang Bui, Executive Vice President and Portfolio Manager; Chris Kemp, senior vice president and portfolio manager; and Tanuj Dora, vice president and portfolio manager.
“We are in a late-cycle environment where credit markets are tougher, volatility is rising and central bank policy is getting tighter,” Forgash said. “LONZ, like many of our ETF offerings, takes an active management approach that aims to be patient and cautious to take advantage of opportunities in credit markets in the weeks and months ahead.”
LONZ is an important addition to PIMCO’s suite of active taxable fixed income ETFs, which includes, among others, the core-plus strategy – the PIMCO Active Bond ETF (BOND) – and the ultra-short bond strategy – the PIMCO Enhanced Short Maturity Active Exchange -Traded Fund (MINT), which is one of the largest fixed income active ETFs in the world.
PIMCO is one of the world’s leading bond investment managers. With our launch in 1971 in Newport Beach, California, PIMCO introduced investors to a total return approach to fixed income investing. For more than 50 years, we have continued to bring innovation and expertise to our partnership with clients seeking the best investment solutions. Today, we have offices around the world united by a single goal: to create opportunities for investors in all environments. PIMCO is owned by Allianz SE, one of the world’s leading providers of diversified financial services.
Investors should carefully consider the fund’s investment objectives, risks, charges and expenses before investing. This and other information is contained in the fund’s prospectus, which can be obtained by contacting your investment professional or PIMCO representative or by visiting www.pimco.com. Please read the prospectus carefully before investing.
The investments made by the Fund and the results achieved by the Fund are not expected to be the same as those made by any other Fund advised by PIMCO, including those with a similar name, objective or investment policies. The performance of a new or reduced fund may not represent the expected or possible performance of the fund over the long term. New funds have limited operating histories that investors can assess and new and smaller funds may not attract enough assets to make effective investments and trades. The Fund may be forced to sell a relatively large portion of its portfolio to meet large cash shareholder redemptions, or hold a relatively large portion of its portfolio in cash due to large cash purchases of shares , in each case where the Fund would not otherwise seek to do so, which may harm performance.
Exchange Traded Funds (“ETFs”) benefit from certain exemptions from the Investment Company Act of 1940. The exemptions allow, among other things, the trading of individual shares on the secondary market. Individual shares cannot be directly purchased or redeemed by the ETF. Purchases and redemptions directly with ETFs are only made through the creation of aggregates of units or “baskets” of shares. Shares in an ETF, traded on the secondary market, are bought and sold at market price (not net asset value). Brokerage commissions will reduce returns. Investment policies, management fees and other information can be found in each ETF’s prospectus. Buy or sell ETF shares stock exchange may require the payment of fees, such as brokerage commissions, and other fees to financial intermediaries. In addition, an investor may incur costs attributed to the difference between the highest price a buyer is willing to pay to purchase shares of the Fund (offer) and the lowest price a seller is willing to accept. for Fund shares (ask) when buying or selling shares on the secondary market (bid-ask spread). Because of the costs inherent in buying or selling shares of the Fund, frequent trading can significantly affect investment returns. Investment in shares of the Fund may not be recommended for investors who expect to engage in frequent trading. ETF shares can be bought or sold throughout the day at their market price on the exchange on which they are listed. However, there can be no assurance that an active trading market for the PIMCO ETF shares will develop or be sustained, or that their listing will continue or remain unchanged. Current holdings are subject to risk. Entries are subject to change at any time. Investing in an ETF involves risk, including loss of principal. Return on investment, 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 paid back. Premium/Discount is the difference between the market price and the net asset value expressed as a percentage of the net asset value.
A word about risk: Invest in the bond market is subject to certain risks, including the risk that the value of fixed income securities will decline due to changes in interest rates; the risk that shares in the fund may trade at prices other than net asset value; and the risk that the manager’s investment decisions will not produce the intended results. Invest in senior loans, including bank borrowings, exposes the Fund to increased credit risk, call risk, settlement risk and liquidity risk. Invest in securities denominated and/or domiciled abroad may involve increased risk due to currency fluctuations, as well as economic and political risks, which may be increased in emerging markets. Exchange rate can fluctuate significantly over short periods of time and reduce portfolio returns. High Yield and Lower Rated Securities involve higher risk than higher rated securities; portfolios that invest in them may be subject to higher 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 cannot be closed at the most advantageous time. Investing in derivatives could lose more than the amount invested. Diversification does not insure against loss.
There is no guarantee that these investment strategies will work in all market conditions or are suitable for all investors and each investor should assess their ability to invest for the long term, particularly during periods of market decline. No representation is made that any account, product or strategy will or is likely to achieve profits, losses or results similar to those stated. Statements regarding financial market trends or portfolio strategies are based on current market conditions, which will fluctuate. Outlook and strategies are subject to change without notice.
Except for historical information and discussions contained in this release, statements in this press release constitute forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. Such statements may involve a number of risks, uncertainties and other factors that could cause actual results to differ materially, including the performance of financial markets, the investment performance of PIMCO’s sponsored investment products and separately managed accounts, general economic conditions, acquisitions future conditions of competition and government regulations, including changes in tax laws. Readers should carefully consider these factors. Further, these forward-looking statements speak only as of the date such statements are made. PIMCO undertakes no obligation to update forward-looking statements to reflect events or circumstances after the date of such statements.
PIMCO in general 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 document contains the current views of the Manager and these views are subject to change without notice. This material has been distributed for informational purposes only and should not be considered investment advice or a recommendation of any particular security, strategy or investment product. The information contained herein was 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 registered trademark of Allianz Asset Management of America LP in the United States and throughout the world. ©2022, PIMCO.
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