ETF Chart of the Day: PIMCO Total Return ETF

November 12th at 11:34am by Paul Weisbruch, Street One Financial

Several months back we highlighted PIMCO Total Return ETF (NYSEArca: BOND) in this piece and the fund continues to turn heads in the industry as assets funnel in. The exchange traded fund holds more than $3.4 billion currently in AUM.

BOND is more than just an “ETF success story” in terms of a relatively new (BOND debuted in March of this year) fund attracting significant assets, it is also a victory for “actively managed ETFs” for this segment of the industry as a whole in our view.

Currently, the top holdings in the ETF are bond securities issued by Fannie Mae, the U.S. Treasury (Bonds), Italian Government Bonds, and Sallie Mae student loan bonds just to provide some overview, and since the fund is actively managed, the portfolio will tend to move around different segments of the bond markets from time to time as the managers see appeal in specific areas. [Gross Touts Active ETF Approach]

What likely is a draw to this fund is the relatively low expense ratio as well (55 basis points), and keep in mind the ETF is actively managed, so from a pure expense standpoint (not to mention the inherent tax efficiency in ETFs) it stacks up rather well against not only fixed income based ETFs, but also actively managed fixed income mutual funds. [BOND Hits $3 Billion]

On Friday, BOND closed at an all time high since its March inception, and actually traded north of $110 briefly during the session. BOND does not have a full year’s worth of performance yet under its belt, but in the trailing 6 month period, the fund has rallied 5.05% versus popular competing “Total Bond Market” Index based ETFs Vanguard Total Bond Market (NYSEArca: BND) and iShares Barclays Aggregate Bond Fund (NYSEArca: AGG) up 1.19% and 1.24% respectively during this same time period.

PIMCO Total Return ETF

For more information on Street One ETF research and ETF trade execution/liquidity services, contact Paul Weisbruch at pweisbruch@streetonefinancial.com.

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