PIMCO Fundamental IndexPLUS TR InstPXTIX

Morningstar Rating

Fund Research and Analysis

by Lawrence Jones

PIMCO Fundamental IndexPLUS TR rebounded strongly from 2008 trouble and is now on its guard.

The dramatic events of the late-2008 financial crisis spelled trouble for this fund. The "portable alpha" approach used here by famed bond manager Bill Gross and his team seeks to best the return of an enhanced version of the Research Affiliates Fundamental Index 1000. Read more

Kudos

This fund is based on a new and innovative indexing methodology.

Bill Gross' bond expertise should help add value over time.

The fund's institutional shares are reasonably priced. Read more

Risks

The retail shares are too expensive.

Tax-inefficient. Read more

Strategy

This fund tracks an enhanced version of the Research Affiliates Fundamental Index 1000. It weights companies according to their sales, book values, cash flows, and dividends, while most other indexes rely on market cap. Read more

Management

This fund is based on an enhanced version of an index founded by Research Affiliates' Robert Arnott. But because it uses swaps that allow it to replicate the returns of Arnott's index, it is able to layer PIMCO's bond expertise on top of that. Bond guru Bill Gross steers the bond portion. Read more

Inside Scoop

In a break from traditional market-cap-weighted indexing, this fund tracks an enhanced version of the Research Affiliates Fundamental Index 1000. In constituting this index, a firm's stock price doesn't figure in, but its sales, book values, cash flows, and dividends do. Read more

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