Fund In Focus: PIMCO Monthly Income

This is a well-run fund from a fixed-income powerhouse.

Ruth Saldanha 17 October, 2023 | 4:00AM
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This fund is a part of the latest Morningstar Prospects. Read more about Morningstar Prospects here.

Five-star, silver-rated PIMCO Monthly Income is a fixed income fund that invests primarily in non-Canadian dollar fixed income instruments of varying maturities. According to PIMCO, the fund seeks maximum current income consistent with the preservation of capital and prudent investment management.

It may be an attractive option for income-oriented investors who seek a bond investment offering the potential for a relatively high and consistent stream of income with an emphasis on high-quality fixed income securities.

The fund came to Morningstar analysts Michael Dobson and Danielle LeClair’s attention because it is a well-run strategy managed by a best-in-class fixed-income firm. The U.S.-domiciled vehicle, the PIMCO Income Fund, earns a High People Pillar and Above Average Process Pillar rating.

So far in 2023, the PIMCO Monthly Income Fund has earned 1.51%, beating its category, which earned an average of 0.7%. The fund has a management expense ratio of 0.84%.

Growth of $10,000

Why is PIMCO Monthly Income Fund Worth Considering?

The PIMCO Monthly Income Fund strategy is a multisector fixed-income fund that allocates across higher-yielding and higher-quality assets with a flexible credit philosophy to keep afloat in volatile markets. CIO Dan Ivascyn and managers Alfred Murata and Josh Anderson have managed the fund since its 2011 inception.

“Both Ivascyn and Murata are past Morningstar Managers of the Year winners and have shown their ability to guide the fund’s objectives through multiple market environments. The income focus of the strategy results in exposure to higher-yielding sectors such as high-yield corporates and non-U.S. bonds,” Dobson and LeClair point out. They add that residential mortgages play an important role in the fund’s success and stability, differentiating it from peers.

“PIMCO’s expertise helps it navigate a segment of the market other managers shy away from. The fund also benefits from PIMCO’s macro research. Although the Canada-domiciled vehicle is a copy of the U.S.-domiciled vehicle, regulatory differences and cash flows can result in some slight holdings differences,” Dobson and LeClair say.

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Securities Mentioned in Article

Security NamePriceChange (%)Morningstar Rating
PIMCO Monthly Income F12.56 CAD0.16Rating

About Author

Ruth Saldanha

Ruth Saldanha  is Editorial Manager at Morningstar.ca. Follow her on Twitter @KarishmaRuth.

 
 
 

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