PIMCO, the world’s largest bond fund manager, is working on 19 actively managed exchange traded fund versions of its mutual fund lineup to further diversify into the ETF industry.
According to SEC filings on Jan. 24, PIMCO is planning ETF variations of mutual funds like the PIMCO Income (PIMIX), PIMCO Unconstrainted Bond (PFIUX), PIMCO Municipal Bond (PFMIX) and a couple StocksPlus and IndexPlus strategies, reports Alexis Leondis for Bloomberg.
The line of StocksPlus funds try to outperform equities with bonds and derivatives. IndexPlus funds track alternative benchmark indices, as opposed to traditional market capitalization indices.
“We believe actively managed ETFs provide another way for investors to access Pimco’s global strategies across fixed income, equities and commodities, all backed by the firm’s time-tested investment process,” PIMCO said.
The ETF versions will likely employ a sampling technique to provide equivalent exposure as their mutual fund counterparts. Consequently, investors can draw upon the mutual fund track records. For instance, PIMIX has generated an average annualized return of 14.6% over the past five years, PFIUX has gained an average 5.2% over the past five years and PFMIX returned an average 7.9% over the last five years.
In 2012, PIMCO successfully introduced an ETF adaptation of its flagship Total Return Fund, the PIMCO Total Return ETF (BOND) , which has $3.5 billion in assets under management.
The money manager recently launched two new active ETFs based of its mutual funds: the actively managed PIMCO Diversified Income Exchange-Traded Fund (DI) and the PIMCO Low Duration Exchange-Traded Fund (LDUR) . [PIMCO Launches Two Active ETFs Based Off Mutual Funds]
Actively managed ETFs still make up a small portion of the overall industry. There are 77 active U.S.-listed ETFs on the market, with $15 billion in assets under management. In comparison, there are 1,554 U.S.-listed ETFs, with almost $1.7 trillion in assets.
For more information on active ETFs, visit our actively managed ETFs category.
Max Chen contributed to this article.
The opinions and forecasts expressed herein are solely those of Tom Lydon, and may not actually come to pass. Information on this site should not be used or construed as an offer to sell, a solicitation of an offer to buy, or a recommendation for any product.