Fremont Bond Fund

Economic analysis serves as the base for PIMCO’s portfolio strategy.

Annually, PIMCO investment professionals conduct a three-day secular forum where long-term economic and market forces are evaluated and portfolio strategies are set. Each quarter the team meets to evaluate the current business cycle and develop shorter-term forecasts which are used to fine-tune investment strategy.

PIMCO’s fixed income research efforts focus on identifying relative value and understanding the risks inherent in different portfolio structures, strategies and bond market sectors. Using proprietary analytics and bottom-up credit analysis, the portfolio managers select individual bonds based on recommendations from sector analysts (who specialize in corporate, mortgage, high yield, government and international bonds).

Investment Process Chart

Ideal Security

The ideal investment exhibits many of the following traits:

• It allows management to meet its overall portfolio positioning targets. Management typically invests in investment grade securities but may invest up to 10% of the portfolio in securities that are below investment grade.
• The investment has been independently analyzed by PIMCO. PIMCO does not rely solely on the credit ratings assigned by outside credit agencies.
• Fund management deems that the security provides value relative to other securities within the same sector.

Portfolio Construction

Portfolio management:

• Is committed to seeking value across all bond market sectors
• Actively manages duration exposure, yield curve position, volatility, sector allocation and security selection and take only modest exposures in each of these areas relative to the market.
• Normally hedges at least 75% of its foreign currency exposure
• Utilizes derivatives (futures, options, swap agreements) as substitutes for physical securities as a means of gaining more cost-effective exposure.

Sell Discipline

The investment team may sell securities when:

• Securities individually no longer represent relative value
• Fund management makes a shift in its portfolio strategy (change in duration, yield curve positioning, sector strategy, etc.)

Investors should carefully consider the fund's investment objectives, risks, charges, and expenses before investing. For this and other information, please call 800.835.3879 or download a free prospectus. Read it carefully before investing or sending money.

The performance shown represents past performance and is not a guarantee of future results. Current performance may be lower or higher than the performance data quoted. The investment return and the principal value of an investment will fluctuate so that an investor’s shares, when redeemed, may be worth more or less than their original cost. From time to time the advisor has waived fees or reimbursed expenses, which may have resulted in higher returns. The listed returns and yields on the Fund are net of expenses and the returns and yields on the indices exclude expenses. Current performance of the Fund may be lower or higher than the performance quoted.

There is no guarantee that these investment strategies will work under all market conditions, and each investor should evaluate their ability to invest for a long-term, especially during periods of downturns in the market.

The investment return and the principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost.