'One-stop' Pimco Emerging Markets Full Spectrum Bond Fund launches

By Toni Weeks

San Luis Obispo, Calif., Feb. 25 - Pimco said it has launched the Pimco Emerging Markets Full Spectrum Bond Fund.

According to a press release, the fund is designed to give investors a comprehensive, "one-stop" fixed-income strategy to capture a wide variety of investment opportunities in the developing world. Managed by Michael Gomez, managing director and co-head of Pimco's global emerging markets portfolio management team, the fund provides an asset allocation and risk management framework for relative value investing across fixed-income and currency asset classes.

Many investors are under-allocated to developing economies, Pimco said in the release, and the fund draws on the firm's expertise in asset allocation to navigate the best relative value opportunities in emerging markets sovereign bonds, local currency bonds, corporate bonds and currencies.

"Many fast-growing emerging markets offer investors a range of choices, such as undervalued currencies, attractive yields in local bond markets, the improving credit quality of sovereign debt or the higher yields of corporate bonds, but identifying and capturing the best opportunities requires a dynamic asset allocation framework and robust risk management," Gomez said in the release.

As previously reported, the fund seeks maximum total return, consistent with prudent investment management, and is designed to provide dynamic exposure to a broad range of emerging-market fixed-income asset classes. Investments include external debt obligations of sovereign, quasi-sovereign and corporate entities; local currency-denominated obligations of sovereign, quasi-sovereign and corporate issuers; and currencies.

Under normal conditions, the fund invests at least 80% of its assets in investments economically tied to emerging market countries and 80% of its assets in fixed-income instruments.

The fund's benchmark index is a blend of the JPMorgan Global Bond Index Emerging Markets - Global Diversified with a 50% weight, the JPMorgan Emerging Markets Bond Index Global with a 25% weight and the JPMorgan Corporate Emerging Market Bond Index Diversified with a 25% weight.

The fund's average portfolio duration will normally vary within two years of the duration of the securities comprising the benchmark, which was 5.76 years as of Dec. 31.

The fund is launching with class A, class C, institutional class, class P and class D shares. The ticker symbols are PFSSX, PFSCX, PFSIX, PFSPX and PFSYX, respectively.

Shareholder fees include a 3.75% maximum sales charge for class A shares. Class A and class C shares are subject to a 1% maximum deferred sales charge. Class R, institutional class, class P, administrative class and class D shares are not subject to shareholder fees.

Management fees are 1.14% for class A, class C and class R shares. Including other fees and taking into account a fee waiver agreement with the investment adviser, total annual fund operating expenses are expected to be 1.29% for class A, 2.14% for class C and 1.64% for class R shares.

For institutional class and administrative class shares, management fees are 0.99%. Class P's management fees run 1.09%, and class D's run 1.14%. Total annual fund operating expenses after the fee waiver are expected to be 0.99% for institutional class, 1.09% for class P, 1.24% for administrative class and 1.39% for class D shares.

Newport Beach, Calif.-based Pimco is the investment adviser to the fund.

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