Andrew Balls, PIMCO fixed income chief investment officer (CIO), said the performance of both funds was driven by the firm’s philosophy of seeking to generate consistent value through multiple sources.
“During the first quarter of 2020, top-down themes, in particular an emphasis on taking interest rate risk in the US, were the primary drivers of performance as yields fell broadly alongside a sharp deterioration in risk sentiment as COVID-19 spread across the globe,” Balls said.
“Our top-down focus, which included insights from medical experts, allowed us to navigate a highly uncertain economic environment and adjust our overall level of risk as economic and market conditions rapidly evolved.”
On the environmental, social and governance (ESG) fund specifically, Balls said 2020 saw an increase in issuance across the sustainable bond market, which included green, social, and sustainability bonds.
“This growth of the sustainable bond market has enriched the opportunity set for a strategy that is focused on both ESG optimisation as well as generating a strong performance,” Balls said.
The judges said PIMCO was a global leader in fixed income and that both funds had a highly sophisticated process, with deep research and huge resources.
They also said PIMCO harnessed a wealth of experienced investors and plentiful resources to contribute to this strategy.
“The combined quality and depth of the macro perspective which feeds into their secular and cyclical outlooks, the sophistication of their fundamental and quantitative credit analysis process, and the robust framework of risk controls which govern portfolio construction all positively differentiate their approach,” the judges said.
“The firm’s longer-term focus and extensive use of synthetic instruments play a substantial role in enabling PIMCO to manage their large asset base effectively.
“Furthermore, the scale and extensive scope of the firm ensures that they are well positioned to investigate emerging ideas.”