Pimco announces exchange-traded fund linked to Build America Bonds

By Devika Patel

Knoxville, Tenn., Sept. 21 - Pimco said in a press release it has launched a new exchange-traded fund, Pimco Build America Bond Strategy Fund.

The fund is actively managed and offers access to taxable municipal bonds issued under the Build America Bonds program. The fund seeks to capture attractive yield opportunities in this sector while also avoiding securities from municipalities that Pimco believes face deteriorating credit quality.

The fund is managed by executive vice president and head of Pimco's municipal bond desk, John Cummings. It provides access to the Build America Bond market. Build America Bonds are taxable municipal bonds that have increased in popularity since they were first authorized under the American Recovery and Reinvestment Act of 2009.

While the BABS program is scheduled to expire at the end of this year, Pimco is optimistic that the program will be extended.

Pimco also said it has created the Pimco Investment Grade Corporate Bond index fund, which seeks to track its benchmark index with an optimized exposure to investment-grade U.S. corporate debt issues that are primarily component securities of the benchmark.

"These new funds broaden investor access to two important fixed income areas - Build America Bonds and investment-grade corporate bonds - using the efficient, transparent exchange-traded fund format," managing director and head of Pimco's global exchange-traded fund business Tammie Arnold said in a press release.

"As with all Pimco investment products, our exchange-traded funds benefit from Pimco's nearly four decades of investment management experience, strong analytics and risk management expertise."

Pimco is a fixed-income fund-management company based in Newport Beach, Calif.

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