PIMCO Total Return ETF

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]