PIMCO Launches Short Term Municipal Bond Fund
Wednesday, February 3rd, 2010ActiveETFs | InFocus submits:
On Feb 2, 2010, PIMCO’s Short Term Municipal Bond Fund (SMMU) began trading on the market. This is just the first of 3 additional Active ETFs that PIMCO has planned for launch and the remaining two (GOVY and PPRM) will likely be coming to market over the next few months as well.
SMMU will be investing in tax-free municipal bonds with the portfolio’s average duration expected to be less than 3 years. The portfolio is benchmarked to Barclays Capital 1-3 Year Municipal Bond Index and will be managed by EVP John Cummings. With the fund lacking a performance history, investing in it with confidence can be difficult, but investors can look to the PIMCO Short Duration Municipal Income Fund A, also run by John Cummings, which has essentially the same mandate as SMMU. This fund has outperformed its benchmark the last 1-yr period but has underperformed in a 3-yr, 5-yr, 10-yr period as well as since inception.
