PIMCO Income Fund (PONAX) - Anything comparable to this?

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teelainen
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PIMCO Income Fund (PONAX) - Anything comparable to this?

Post by teelainen »

Anyone own this fund?

The current yield is 3.34% and the price of this fund has been very stable at all times.

If you have owned this before, what else have you found to be better?
Booogle
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Re: PIMCO Income Fund (PONAX) - Anything comparable to this?

Post by Booogle »

alex_686
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Re: PIMCO Income Fund (PONAX) - Anything comparable to this?

Post by alex_686 »

Booogle wrote: Fri Jan 21, 2022 4:40 pm If you just want yield, buy JEPI.

https://am.jpmorgan.com/us/en/asset-man ... -46641q332

But I want more money in my pocket, not just yield.
First, don't look at yield. Don't chase yield. Yield is a deceptive number.

And no, JEPI is nothing like PONAX. Very different strategies.

The only other funds that are close in strategies are other PIMCO funds. I own and like the Total Return Fund. This is not exactly a recommendation. It is a highly actively managed fund. They are doing some very interesting things to generate return. I work in the field and have a hard time picking apart their strategies. Nobody is doing what they are doing. If people were doing what they were doing they would not be able to charge their high portfolio management fees. Which I think are worth it for the value they add. I also acknowledge that this opinion is very much open for debate.
Former brokerage operations & mutual fund accountant. I hate risk, which is why I study and embrace it.
Booogle
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Re: PIMCO Income Fund (PONAX) - Anything comparable to this?

Post by Booogle »

alex_686 wrote: Fri Jan 21, 2022 4:47 pm First, don't look at yield. Don't chase yield. Yield is a deceptive number.
Yeah I know.

But some people want yield.
alex_686
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Re: PIMCO Income Fund (PONAX) - Anything comparable to this?

Post by alex_686 »

Booogle wrote: Fri Jan 21, 2022 4:48 pm But some people want yield.
... When they really need Total Return. Or even better, total after tax risk adjusted return.
Former brokerage operations & mutual fund accountant. I hate risk, which is why I study and embrace it.
Booogle
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Re: PIMCO Income Fund (PONAX) - Anything comparable to this?

Post by Booogle »

PIMIX is the cheaper share of PONAX.

And its available at TD Ameritrade.

https://research.tdameritrade.com/grid/ ... mbol=PIMIX
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ResearchMed
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Re: PIMCO Income Fund (PONAX) - Anything comparable to this?

Post by ResearchMed »

Booogle wrote: Fri Jan 21, 2022 4:55 pm PIMIX is the cheaper share of PONAX.

And its available at TD Ameritrade.

https://research.tdameritrade.com/grid/ ... mbol=PIMIX
It's available at Vanguard with a $25k minimum, which is lower than the usual.
PIMIX has a transaction fee there, however, whereas PONAX is NTF (no transaction fee).

Both of them transferred in kind to TIAA when our 403b was moved.
I was surprised to see that neither of them are NTF, not even PONAX. (I haven't verified that; but that's what the fund description shows.)

RM
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RetiredCSProf
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Re: PIMCO Income Fund (PONAX) - Anything comparable to this?

Post by RetiredCSProf »

Yes, I have been invested in PONAX in my rollover IRA at Fidelity for the past five years. The load-fee is waived by Fido.

No, I have not found any other bond fund that is comparable to PONAX.

I have no experience with the following fund, which is also categorized as a multi-sector bond fund: Lord Abbett Bond Debenture Fund Class A (LBNDX)
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calmaniac
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Re: PIMCO Income Fund (PONAX) - Anything comparable to this?

Post by calmaniac »

PONAX has an expense ratio of 1.02%.

I don't get the attraction. Am I missing something?
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Booogle
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Re: PIMCO Income Fund (PONAX) - Anything comparable to this?

Post by Booogle »

Look into SWAN.

It has less drawdown and more gains than PIMIX:

https://www.portfoliovisualizer.com/bac ... ion2_2=100
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Re: PIMCO Income Fund (PONAX) - Anything comparable to this?

Post by Dave55 »

Booogle wrote: Fri Jan 21, 2022 6:08 pm Look into SWAN.

It has less drawdown and more gains than PIMIX:

https://www.portfoliovisualizer.com/bac ... ion2_2=100
PIMIX YTD: - .8%
SWAN YTD: -6.11%

Dave
"Reality always wins, your only job is to get in touch with it." Wilfred Bion
Booogle
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Re: PIMCO Income Fund (PONAX) - Anything comparable to this?

Post by Booogle »

Dave55 wrote: Fri Jan 21, 2022 6:29 pm
Booogle wrote: Fri Jan 21, 2022 6:08 pm Look into SWAN.

It has less drawdown and more gains than PIMIX:

https://www.portfoliovisualizer.com/bac ... ion2_2=100
PIMIX YTD: - .8%
SWAN YTD: -6.11%

Dave
I don't know if that includes distributions or not though.

https://screener.fidelity.com/ftgw/etf/ ... mbols=SWAN
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Re: PIMCO Income Fund (PONAX) - Anything comparable to this?

Post by Dave55 »

teelainen wrote: Fri Jan 21, 2022 3:52 pm Anyone own this fund?

The current yield is 3.34% and the price of this fund has been very stable at all times.

If you have owned this before, what else have you found to be better?
I did own it for many years (PIMIX version). There are comparable multi sector bond funds out there. I don't invest in multisecotr bond funds any longer so the best I can suggest is for you to drill down using Morningstar and or read Armchairinvesting forums as they discuss managed bond funds there: https://armchairinvesting.freeforums.net

Dave
"Reality always wins, your only job is to get in touch with it." Wilfred Bion
CletusCaddy
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Re: PIMCO Income Fund (PONAX) - Anything comparable to this?

Post by CletusCaddy »

calmaniac wrote: Fri Jan 21, 2022 5:17 pm PONAX has an expense ratio of 1.02%.

I don't get the attraction. Am I missing something?
The institutional version is PIMIX and only is 0.5% ER

The attraction is that since inception in 2007 PIMIX has returned 7.7% CAGR compared to 3.9% CAGR for Vanguard Total Bond.

https://www.portfoliovisualizer.com/fun ... mark=VBMFX
sycamore
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Re: PIMCO Income Fund (PONAX) - Anything comparable to this?

Post by sycamore »

Booogle wrote: Fri Jan 21, 2022 6:31 pm
Dave55 wrote: Fri Jan 21, 2022 6:29 pm
Booogle wrote: Fri Jan 21, 2022 6:08 pm Look into SWAN.

It has less drawdown and more gains than PIMIX:

https://www.portfoliovisualizer.com/bac ... ion2_2=100
PIMIX YTD: - .8%
SWAN YTD: -6.11%

Dave
I don't know if that includes distributions or not though.

https://screener.fidelity.com/ftgw/etf/ ... mbols=SWAN
Dave55's numbers were YTD, meaning since the beginning of the Year To Date. There have been no distributions year to date for either SWAN or PIMIX.
Elysium
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Re: PIMCO Income Fund (PONAX) - Anything comparable to this?

Post by Elysium »

teelainen wrote: Fri Jan 21, 2022 3:52 pm Anyone own this fund?

The current yield is 3.34% and the price of this fund has been very stable at all times.

If you have owned this before, what else have you found to be better?
Be careful with this fund. It is a multi-sector income fund, which means it invests all over the fixed income landscape including high yield bonds, emerging market govt and corp bonds, and include derivative contracts. In a year when risk shows up, this type of fund could lose a lot of value, but when risk is being rewarded they could earn a lot. Vanguard has a similar fund called Multisector Income fund (VMSIX) which they launched last year, and it should have similar risk profile without derivative contracts that Pimco uses. Expect these funds to looks like a combination of 60% Total Bond, 25% High Yield, and 15% Emerging Market Bonds.
RetiredCSProf
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Re: PIMCO Income Fund (PONAX) - Anything comparable to this?

Post by RetiredCSProf »

Bond funds are affected by several different types of risk; credit risk is just one of those risks. Between 20 Feb 2020 and 20 Mar 2020, my holdings in PONAX dropped 12.85%. During the same time period, my high-yield bond funds dropped over 20%, and my short-term bond TIPs fund dropped 3.5%. All recovered within a few months or so.

Between 20 Dec 2021 and 20 Jan 2022 (interest rate risk increased), my intermediate treasury bond funds took the biggest hit; I expect that these will eventually recover, but it may take several years.
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teelainen
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Re: PIMCO Income Fund (PONAX) - Anything comparable to this?

Post by teelainen »

Elysium wrote: Fri Jan 21, 2022 7:33 pm
teelainen wrote: Fri Jan 21, 2022 3:52 pm Anyone own this fund?

The current yield is 3.34% and the price of this fund has been very stable at all times.

If you have owned this before, what else have you found to be better?
Be careful with this fund. It is a multi-sector income fund, which means it invests all over the fixed income landscape including high yield bonds, emerging market govt and corp bonds, and include derivative contracts. In a year when risk shows up, this type of fund could lose a lot of value, but when risk is being rewarded they could earn a lot. Vanguard has a similar fund called Multisector Income fund (VMSIX) which they launched last year, and it should have similar risk profile without derivative contracts that Pimco uses. Expect these funds to looks like a combination of 60% Total Bond, 25% High Yield, and 15% Emerging Market Bonds.
Is BND considered a multi-sector income fund? If not, what makes it not a multi-sector income fund? Just curious and trying to learn, thanks.
RetiredCSProf
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Re: PIMCO Income Fund (PONAX) - Anything comparable to this?

Post by RetiredCSProf »

Using Morningstar bond categories, BND is considered an intermediate "core" bond fund, not a multi-sector bond fund. Core bond funds hold a mix of U.S. Treasuries, U.S. mortgage-backed securities, and high-rated U.S. corporate debt. An investment in BND is an investment in only a portion of the fixed-income market, not the total bond market.

Multi-sector bond funds are more diversified in that they hold foreign bond funds (developed and emerging) and high-yield (lower quality) bond funds. According to M*, multi-sector bond funds hold 35% - 65% of their bond assets in securities that are rated "BB" or lower.

"Core plus" bond funds lie somewhere in the middle, by having some exposure to emerging market debt, bank loans, and high-yield corporates.
Elysium
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Re: PIMCO Income Fund (PONAX) - Anything comparable to this?

Post by Elysium »

RetiredCSProf wrote: Sun Jan 23, 2022 11:39 pm Using Morningstar bond categories, BND is considered an intermediate "core" bond fund, not a multi-sector bond fund. Core bond funds hold a mix of U.S. Treasuries, U.S. mortgage-backed securities, and high-rated U.S. corporate debt. An investment in BND is an investment in only a portion of the fixed-income market, not the total bond market.

Multi-sector bond funds are more diversified in that they hold foreign bond funds (developed and emerging) and high-yield (lower quality) bond funds. According to M*, multi-sector bond funds hold 35% - 65% of their bond assets in securities that are rated "BB" or lower.

"Core plus" bond funds lie somewhere in the middle, by having some exposure to emerging market debt, bank loans, and high-yield corporates.
This. Think of BND as a Core Bond, this is the baseline in terms of risk, you can go even lower risk than Core bonds with safer Treasuries and shortening duration also, but they come at cost of giving up more returns. Core Bonds are ideal in terms of term & credit risk for most people as they are the benchmark, at least in case of BND. The next level of risk is Core Plus bonds, where they add on more High Yield, and Emerging Market debt, in search of more returns, and they are only slightly more riskier than Core Bonds. Multi-sector Bonds take the risk another notch up, by increasing High Yield and Emerging Market debts even more, they offer more returns, but also is far more riskier than Core Bonds. Most people are well served with Core Bonds, or Core Plus if they are willing to go a bit more on the risk spectrum. No one actually needs Multi-sector unless you know what you are doing.

Vanguard offers several bonds all along the risk spectrum, and they do a good job of keeping the risk under control even within their High Yield bonds that are slightly better quality than some of the others. Pimco uses derivates in almost all of their bond funds to boost returns and manage risk, and this just add another layer of complexity and risk. While it may suit some investors who know what they are doing, it is not for everyone.
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