PIMCO Commodity Real Ret Strat InstlPCRIX

Morningstar Rating

Fund Research and Analysis

by Kevin McDevitt, CFA

PIMCO Commodity Real Return Strategy annihilated its benchmark in 2009, but let's hope that doesn't happen again.

This fund performed a little too well last year. It beat its underlying index, the Dow Jones-UBS Commodity Index, by more than 20 percentage Read more

Kudos

Offers broad exposure to commodities.

PIMCO has a good track record of enhancing index returns through adroit use of derivatives and bonds. Read more

Risks

The fund's fixed-income portfolio introduces some interest-rate and credit risk, as evidenced in 2008, making the fund a poor fit for investors seeking a pure play on commodities.

Won't march with the natural-resources pack.

The fund's expense ratio hasn't come down as assets have increased. Read more

Strategy

This fund invests in derivative instruments that seek to replicate the performance of the Dow Jones-UBS Commodity Index. Because the fund's use of derivatives can gain full exposure to the index with Read more

Management

John Brynjolfsson, who managed this fund since its 2002 inception, stepped down in 2008. Mihir Worah, who has worked on the fund since 2003, took the reins of this fund and Brynjolfsson's other former charge, PIMCO Real Return PRTNX, in December 2007. Read more

Inside Scoop

This fund is an odd bird. Instead of investing in the stocks of companies that produce natural resources, it invests in securities that tie returns to the swings in commodities' Read more

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