Todd Rosenbluth, Head of Research at VettaFi, explores the advantages of PIMCO Active Bond ETF in fluctuating interest rate climates, its outperformance against indexed ETFs, and the benefits as a main bond holding. The podcast delves into the role of active bond funds, the post-Bill Gross era performance, and the importance of active management in the bond space.
PIMCO Active Bond ETF (BOND) excels in various interest rate scenarios, not just rising rates.
Investors should balance PIMCO Active Bond ETF with index funds for diversified fixed income approach.
Deep dives
Benefits of the PIMCO Active Bond ETF
The PIMCO Active Bond ETF, ticker B-O-N-D, stands out as an attractive investment option due to its performance across different market conditions. Unlike traditional beliefs that active bond ETFs excel only in rising rate environments, the flexibility of this ETF allows it to perform well in various interest rate scenarios. With a focus on managing interest rate and credit risks effectively, the fund provides investors with a diversified approach to fixed income investing. This ETF serves as a core component in a portfolio, offering a balance between active and index-based strategies for enhanced returns.
Considerations for Including the PIMCO Active Bond ETF in a Portfolio
When contemplating the inclusion of the PIMCO Active Bond ETF in a portfolio, investors should evaluate their existing bond holdings to ensure diversification and performance consistency. While having multiple active funds in one investment style might lead to overconcentration, pairing the PIMCO ETF with index funds can provide a balanced approach to fixed income investing. Monitoring the fund's performance relative to benchmarks and considering expert management expertise are crucial factors in deciding whether to retain, replace, or complement existing bond investments with the PIMCO Active Bond ETF.
VettaFi’s Head of Research Todd Rosenbluth discussed thePIMCO Active Bond ETF (BOND)on this week’s “ETF of the Week” podcast with Chuck Jaffe of “Money Life.”
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