The fund seeks to capitalize on the expected sharp increase in spending by developing nations on energy, transportation, water and waste treatment, telecommunications, public housing and development banks, a press release said. The portfolio manager of the fund is Brigitte Posch, an executive vice president at the firm.
Emerging market (EM) governments around the world are targeting infrastructure investments as critical foundations for future growth, with more than $1 trillion of projects committed to or underway. Bonds that finance these projects typically offer attractive yields, often with lower volatility than seen in some other credit opportunities, PIMCO explained. Additionally, the high priority governments are giving to infrastructure may help to mitigate the credit risk of such investments, which in turn might limit correlations with emerging equity markets.
“Emerging markets are capturing a bigger slice of global growth thanks to their ongoing economic development and improving creditworthiness, and we believe that national infrastructure is a strategically important area of opportunity in the sector,” said Posch, in the announcement.
Institutional shares of the PIMCO Emerging Markets and Infrastructure Bond Fund will trade with the ticker PEMIX.
More information is available at www.pimco-funds.com.