Much was made several months back about outflows for the first time since BOND’s (PIMCO Total Return, Expense Ratio 0.55%) 2012 inception that occurred in the marketplace, but the fund has still pulled in $131 million (net) year to date (total asset base is $3.86 billion which is an impressive number given the limited live track record of the fund).
Recently, despite a noticeable rally in BOND where today it is challenging its 200 day moving average for the first time since late May/early June. Volume has been above average for the most part in BOND lately as well yet the fund has not seen a return of inflows just yet (recent sessions have involved net outflows of $63 million).
How has BOND weathered the storm of volatility across the fixed income markets that mostly involved a sustained sell-off in U.S. Treasuries throughout the summer and early fall only to be met with stabilization in Treasury prices lately. BOND’s managers are invested in FNMA (Mortgage Pass Through Securities) (about 33% of the portfolio) as well as U.S. Treasury notes (12.24%) as well as U.S. Treasury TIPS (8.24% weighting).
There are several other bond positions in the portfolio at the moment as well, but the theme is pretty consistent as most are tied to U.S. Governments and agency securities. The SEC 30-Day Yield as listed on fund literature is currently 1.70%, with a YTM of 3.81%. Since BOND is actively managed, the strategy seems to be positioned well lately in terms of what is happening in the fixed income markets based on the recent move, so it will be interesting for us to see if assets return to the fund heading into year’s end or we continue to see a slow trickle out.
Classified as “Total Bond Market” ETFs that are not actively managed that compare well to BOND from a category standpoint include the largest in the category BND (Vanguard Total Bond Market, Expense Ratio 0.10%), AGG (iShares Core Total U.S. Bond Market, Expense Ratio 0.08%), and BSV (Vanguard Short Term Bond, Expense Ratio 0.11%), which are all larger funds in terms of assets under management (they are in order, the top three in the category) compared to BOND.