ETF Chart of the Day: PIMCO Total Return

April 18th at 12:49pm by Paul Weisbruch, Street One Financial

Trading at a fresh all-time high since inception this morning is BOND (PIMCO Total Return ETF, Expense Ratio 0.55%), which has made a ton of noise in the ETF world in quickly raising $4.9 billion in assets under management since its March 2012 inception.

The ETF follows an actively managed strategy, targeting investment grade debt securities across a variety of categories in the fixed income markets, with an average portfolio duration that, according to the fund’s literature, “normally varies within two years (plus or minus) of the benchmark Barclays Capital U.S. Aggregate Index”.

Most recently, the fund has been positioned most heavily in Mortgage backed as well as U.S. Treasury securities, with exposure to a lesser degree in Non-U.S. Developed Markets fixed income securities among its top holdings.

BOND was initially launched with a ticker symbol “TRXT”, but was quickly modified to BOND, and from a marketing standpoint this seemed to be a very successful move given the asset growth and recognition that the fund has quickly garnered.

Trading volume in the product has been exceptionally above average for at least the past month on recent price strength in the product, and we note that related securities (i.e. U.S. Treasuries) are certainly catching a bid in recent sessions, with barometers like TLT (iShares Barclays 20+ Year Treasury Bond, Expense Ratio 0.15%) again challenging 2013 highs as equities have been shaken in recent sessions.

Also of note is the fact that since inception, BOND continues to outperform PTTAX (PIMCO Total Return Fund Class A), and PTTRX (PIMCO Total Return Fund Institutional Class), which are the more tenured, and enormously successful mutual fund offerings in the space from the same fund company. Of course there are no guarantees on future performance and BOND is not a separate share class of the larger Total Return mutual funds mentioned here, but the immense asset growth in the ETF and strong showing in a bit over a year since inception is a huge victory thus far for “actively managed ETFs” in our view. [Active ETF Market Gearing Up]

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.

Tickers

BOND TLT