A high quality asset offering yield pick-up over government bonds
Covered Bonds are the most senior bonds of an issuer (bank or mortgage institution). The asset class offers both safe haven characteristics and a yield pick up over government bonds. Covered bonds are supported by dual recourse to both the issuing institution and a cover pool of highly quality assets.
Other financial institutions provide services such as safekeeping of assets or as a counterparty to financial contracts such as derivatives. The fund is exposed to the risk of bankruptcy, or other type of default of transaction counterparties.
Credit and Default Risk
A decline in the financial health of an issuer of a fixed income security can lead to an inability or unwillingness to repay a loan or meet a contractual obligation. This could cause the value of its bonds to fall or become worthless. Funds with high exposures to non-investment grade securities have a higher exposure to this risk.
Derivatives and Counterparty Risk
The use of certain derivatives could result in the fund having a greater or more volatile exposure to the underlying assets and an increased exposure to counterparty risk. This may expose the fund to larger gains or losses associated with market movements or in relation to a trade counterparty being unable to meet its obligations.
Fixed Income Risk
There is a risk that the institution which issued the securities will fail, which would result in a loss of income to the fund. Fixed income values are likely to fall if interest rates rise.
Risk of Using Derivatives
In order to reach its investment objective, the fund may use swaps, including futures and forwards. Such derivatives may result in gains or losses that are greater than the original amount invested.
Interest Rate Risk
Changes in interest rates will usually result in the values of bond and other debt instruments moving in the opposite direction (e.g. a rise in interest rates likely leads to fall in bond prices).
Mortgage Related and Other Asset Backed Securities Risks
Mortgage or asset backed securities are subject to similar risks as other fixed income securities, and may also be subject to prepayment risk and higher levels of credit and liquidity risk.
The PIMCO Covered Bond UCITS ETF aims to generate income while preserving and growing capital. The ETF will invest primarily in an actively managed diversified portfolio of covered bonds.
Bloomberg Euro Aggregate Covered 3% Cap Index
The Bloomberg Euro Aggregate Covered 3% Cap Index (the "Index") tracks the performance of euro-denominated covered bonds. Inclusion is based on the currency denomination of the issue and not the domicile of the issuer. Qualifying securities must have an investment grade rating (based on an average of Moody's, S&P and Fitch), at least one year remaining term to final maturity, a fixed coupon schedule and a minimum amount outstanding of EUR 300 million. Index constituents are capitalization-weighted, based on their current amount outstanding, provided the total allocation to an individual issuer does not exceed 3%. It is not possible to invest directly in an unmanaged index
|Data point name||Data point value|
The fund is considered to be actively managed in reference to the Index by virtue of the fact that the Bloomberg Barclays Euro Aggregate Covered 3% Cap Index (the "Index") is used for duration measurement and for performance comparison purposes. Certain of the fund’s securities may be components of and may have similar weightings to the Index. However, the Index is not used to define the portfolio composition of the fund or as a performance target and the fund may be wholly invested in securities which are not constituents of the Index. The fund is actively managed in reference to the above Benchmark as further outlined in the prospectus and key investor information document.
|Data point name||Data point value|
|Benchmark BBG Ticker||BEA3TREU|
|Number of Holdings||75|
|Launch Date||17 December 2013|
|UK Reporting Status||Yes|
|Registered for Distribution in||Belgium, Denmark, Finland, France, Germany, Italy, Luxembourg, Netherlands, Norway, Spain, Sweden, United Kingdom|
|Exchanges||Deutsche Börse Xetra|
|Financial Year End||31 March|
|Equity Ratio (Tax Information for German Investors)||0.00|
|Use of Income||Distributed|
Key Service Providers
|Issuer||PIMCO ETFs plc|
|Manager||PIMCO Europe Ltd|
|Fund Administrator||State Street Fund Services (Ireland) Limited|
|Depository||State Street Custodial Services (Ireland) Limited|
|Authorized Participants||Banca Sella Holding S.p.A., Bluefin Europe LLP, Citigroup Global Market Limited, Credit Suisse Securities (Europe) Limited, DRW Europe B.V., Flow Traders B.V., Goldenberg Hehmeyer LLP, Goldman Sachs International, JP Morgan Securities Ltd., Jane Street Financial Limited, Morgan Stanley and Co. International plc, Nomura International plc, Old Mission Europe LLP, Société Générale , Unicredit Bank AG, Virtu Financial Ireland Limited|
|IRS EUR 3.25000 03/20/24-5Y LCH||3.25||26.31|
|IRS EUR 3.00000 03/20/24-10Y LCH||3.00||15.56|
|SUMITOMO MITSUI TR BK LT SEC||0.01||4.60|
|BANCA MONTE DEI PASCHI S SEC||0.88||4.38|
|LIBERBANK SA COVERED SEC||0.25||4.33|
|CEDULAS TDA 6 COVERED||3.88||4.31|
|CREDIT SUISSE SCHWEIZ AG COV SEC||3.39||4.26|
|REALKREDIT DANMARK IO10**PARTIAL CALL**||4.00||3.81|
|AYT CEDULAS CAJAS X||3.75||3.76|
|SUMITOMO MITSUI BANKING COVERED SEC||0.41||3.69|
Current holdings are subject to risk. Holdings are subject to change at any time.
Indicative Net Asset Value (iNAV) is a measure of the net asset value intraday, and is reported every 15 seconds during trading hours. PIMCO has partnered with external vendor Intercontinental Exchange Ltd. (ICE) to calculate iNAV for the European ETF Fund Ranges. ICE calculates iNAV using the mid prices of the respective ETF basket of securities to derive the market value and divides the total market value by creation unit size. The iNAV is calculated daily.
Fees & Expenses
Because the fund is an ETF, investors will typically only be able to buy or sell shares in the secondary market, on exchange. Authorized Participants who help in the creation or redemption of shares in the primary market, may face “create” or “redeem” fees (aka “entry” or “exit” fees) on the cash portion of the transaction (up to a maximum of 3.00%). These create and redeem fees are not applicable to secondary market investors. However, secondary market investors may incur brokerage and/or transaction fees in connection with their dealings. Secondary market investors may also bear the costs of bid-ask spreads; meaning the difference between the prices at which shares can be bought and sold.
Yields & Distributions
|Distribution Date||Dist. NAV (€)||Dividend Income (€)||Dist. Total (€)|
Price & PerformancePast performance does not predict future returns
|Aug`14 - Aug`15||Aug`15 - Aug`16||Aug`16 - Aug`17||Aug`17 - Aug`18||Aug`18 - Aug`19||Aug`19 - Aug`20||Aug`20 - Aug`21||Aug`21 - Aug`22||Aug`22 - Aug`23|
|Covered Bond UCITS ETF||1.67||3.23||0.91||0.62||5.34||-0.09||0.74||-11.45||-0.96|
|Bloomberg Euro Aggregate Covered 3% Cap Index||1.99||3.74||-0.86||0.35||4.89||-0.84||-0.02||-11.31||-1.52|
|Performance - Fund vs Index||-0.32||-0.51||1.77||0.27||0.45||0.75||0.76||-0.14||0.56|
Past performance is not a guarantee or a reliable indicator of future returns. Current performance may be lower or higher than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Performance data current to the most recent month-end is available by calling +44 203 3640 1552.
Growth of $10,000 is calculated at NAV and assumes that all dividend and capital gain distributions were reinvested. It does not take into account sales charges or the effect of taxes. Results are not indicative of future performance.
|category / asset class||FUND||Fund ratio||Bloomberg Euro Aggregate Covered 3% Cap Index||Index ratio|
|Invest. Grade Credit||91.09||100.00|
|High Yield Credit||0.00||0.00|
|Net Other Short Duration Instruments||-0.94||0.00|
|Sector||Fund||Fund ratio||Bloomberg Euro Aggregate Covered 3% Cap Index||Index ratio|
|Invest. Grade Credit||92.47||100.00|
|High Yield Credit||0.00||0.00|
|Net Other Short Duration Instruments||0.19||0.00|
|Years||% of Fund||% of Bloomberg Euro Aggregate Covered 3% Cap Index|
|Effective Maturity (yrs)||6.81||-|
|Quality||MV (%)||Fund percent|
|Bull Market Duration||4.42||4.42|
|Bear Market Duration||4.58||4.37|
|Total Curve Duration||0.24||N/A|
|Mortgage Spread Duration||0.00||0.00|
|Corporate Spread Duration||0.00||0.00|
|Emerging Markets Spread Duration||0.16||0.05|
** Other net assets (liabilities) includes, but is not limited to, unsettled activity from shareholder and portfolio security trades, and accrued interest and expenses.
NR references securities that do not have a formal or explicit rating from the various rating agencies. Non-rated securities could include cash equivalents and repurchase agreements, government guaranteed mortgage securities, as well as other types of credit that do not have a formal rating.