Bond Giant Pimco Files For Six More ETFs
03 June 2009 - 1:15AM
Dow Jones News
In another sign it hopes to make a big mark on the
exchange-traded fund business, Pacific Investment Management Co.
filed to launch six new ETFs Tuesday.
The move came the same day that Pimco's first ETF, a short-term
Treasury fund, began trading among investors on NYSE Arca. One of
the fastest-growing areas of the investment world, ETFs are baskets
of stocks or bonds that trade throughout the day on an
exchange.
The six newly proposed Pimco funds will cover longer-dated
Treasurys and Treasury Inflation-Protected Securities, or TIPS,
which resemble other Treasurys but adjust their principal to match
changing prices. Pimco, owned by Allianz SE (AZ), earlier indicated
it hopes to launch actively managed ETFs as well.
A large majority of the $72 billion in bond ETFs is in Barclays
iShares funds. Several other firms have also launched Treasury and
other types of bond ETFs hoping to loosen Barclays' grip on the
business, without much success.
Apart from its well-regarded brand name, Pimco hopes to use its
bond-market acumen to design funds that are easier than other ETFs
for market makers to traffic in, potentially lowering costs for
regular investors.
"We trade in the bond market every day throughout the day; it's
a nuanced market," says Managing Director Tammie Arnold.
A preliminary prospectus for the six new funds was filed with
Securities and Exchange Commission, dated June 2.
-By Ian Salisbury, Dow Jones Newswires; 201-938-5219;
ian.salisbury@dowjones.com