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PMZIX

M* says the expense ratio is 1.82% on the “Price” page:

https://www.morningstar.com/funds/xnas/pmzix/price

PIMCO says the gross ER is 1.37%, adjusted ER 0.60%.

https://www.pimco.com/en-us/investments/mutual-funds/mortgage-opportunities-and-bond-fund/inst

The M* “Quote” page seems to be right, though. @Darrin maybe this should be corrected?

Second question: this fund is my only remaining, expensive black box. Its performance and yield/duration are excellent, and it’s (hopefully) a good diversifier to my other bond (and stock) holdings. Anyone else holding this ..... and hoping it doesn’t experience an SEMMX-like supernova?

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Re: PMZIX

Possibly if Covid-19 takes off again. But if one believes in buying low then these types of funds might work. It has had a nice recovery so far from the low. Many are waiting for a second Black Swan but it will be something else next time.


@chang wrote:

M* says the expense ratio is 1.82% on the “Price” page:

https://www.morningstar.com/funds/xnas/pmzix/price

PIMCO says the gross ER is 1.37%, adjusted ER 0.60%.

https://www.pimco.com/en-us/investments/mutual-funds/mortgage-opportunities-and-bond-fund/inst

The M* “Quote” page seems to be right, though. @Darrin maybe this should be corrected?

Second question: this fund is my only remaining, expensive black box. Its performance and yield/duration are excellent, and its (hopefully) a good diversifier to my other bond (and stock) holdings. Anyone else holding this ..... and hoping it doesn’t experience an SEMMX-like supernova?


 

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Re: PMZIX

M* ER at this (link) still says 1.37%.

PMZIX did pretty well YTD and I used to own it for several weeks but the black swan is gone now and may not return

 Total ReturnTotal ReturnTotal ReturnReturnTotal ReturnTotal ReturnSDMorningstarMorningstar
 1 Week1 Month3 MonthYTD12 Month3 Year3 YearReturnRisk
MNCPX(ER-0.5%)0.53.397.921.383.812.793.24AverageLow
JSIAX(ER=0.9%)0.512.056.450.953.012.583.63Above AverageBelow Average
PMZIX-0.031.726.510.833.083.163.36HighLow

 

The other 2 funds are doing better for 1-4 weeks.  You can also see that PMZIX had a better performance in the last 3 years.  It's not a surprise that PMZIX is invested in MBS/Securitized.

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Re: PMZIX

Based on the numbers you posted FD, PMZIX looks like the winner. 1-4 week numbers don’t mean anything to me. PMZIX just keeps grinding higher since the March dip. I don’t like expensive black boxes but I’m going to keep this one for now. Hopefully PIMCO knows more than Semper, Voya and the other suicidal-for-yield companies. I know, hope is not a strategy....

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Re: PMZIX

I like PMZIX best of these, yet not investing in any higher risk bond funds at this time. 

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Re: PMZIX

Chang, Thanks for your reply to me on FD’s thread.   Re PMZIX, I own it.  I am a Murata fan.  I have owned it since inception, except for a couple of weeks in March.  I am not overweight only because it is an MBS fund and convexity is always something to contend with and non-agency MBS is suspect to unemployment.   Without opportunities in non-agency MBS, not sure how the managers can distinguish this from an agency fund (i.e., limited value).  I likely will go overweight (use it also as a cash sub) once there is a vaccine or solid therapy.  

A

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Re: PMZIX

@Anitya According to M* Murata’s personal investment in the fund is between. $0 and $10,000. Maybe PIMCO pays measly salaries, although I seem to remember that Bill Gross left with a reasonable nest egg ...

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Re: PMZIX


@chang wrote:

Based on the numbers you posted FD, PMZIX looks like the winner. 1-4 week numbers don’t mean anything to me. PMZIX just keeps grinding higher since the March dip. I don’t like expensive black boxes but I’m going to keep this one for now. Hopefully PIMCO knows more than Semper, Voya and the other suicidal-for-yield companies. I know, hope is not a strategy....


In my previous post, I didn't mention everything. MNCPX has better performance than PMZIX for 1-3-12 months + MNCPX ER=0.5% while PMZIX ER=1.37%.  Looks to me MNCPX is better.  Below are numbers as of today.

  Total ReturnTotal ReturnTotal ReturnReturnTotal ReturnTotal Return
ER
Ticker1 Week1 Month3 MonthYTD12 Month3 Year
0.50%MNCPX0.323.158.651.714.032.9
1.37%PMZIX0.061.687.430.953.253.18

 

YTD chart shows that PMZIX lost more money in the meltdown but also made less money on the uptrend.

While PMZIX invests almost everything in Securitized/MBS MNCPX is more diversified and I can find its bond rating (see below).

The min to buy MNCPX are as follow.  One million at Fidelity, Can't buy at Vanguard, only $2500 at Schwab with $49.95 fees.  Schwab proved again it's superiority.  You can buy EXCPX in all three ER=0.75% with no fees and low min.

mncpx.PNG

 

I used PMZIX this year for a short while because I didn't know about MNCPX.  Just my opinion, since 2018 the Pimco guys lost their mojo they had for years and why I haven't used their funds too much.  Up o 2018 I always had one of their funds especially PIMIX(Multi) and PHMIX(HY Muni). It's more than 2 years I can find better funds.

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Re: PMZIX


@chang wrote:

@Anitya According to M* Murata’s personal investment in the fund is between. $0 and $10,000. Maybe PIMCO pays measly salaries, although I seem to remember that Bill Gross left with a reasonable nest egg ...


I am not surprised he does not own any meaningful amount because it is not risky enough for him.  I am sure PIMCO would discourage selling that requires public disclosure.  So, he can not really use it to park cash until he can find a better use.

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Re: PMZIX

It’s not a “cash sub” (a term I don’t care for) for me; with a yield of 3.3%, it’s an income generator. BSV is my “cash sub” i.e., what I’ll sell when I need to raise immediate cash to pay for something.
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Re: PMZIX

MNCPX ended up in the bottom half of its category in 4 of its 7 years of existence. Remember, rolling returns are much more instructive than total returns.

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Re: PMZIX

Comparing PMZIX to MNCPX is a good example of where I see things differently than FD. Screenshot_20200624-103816.png

Over five years, PMZIX wipes the floor with MNCPX. Both experienced a similar drop early 2020. But, MNCPX has outperformed during the very recent past.

Me, I note the recent outperformance, but would not buy the fund for that reason. I see short-term moves as mostly noise. However, I am not a member of the Yugo Racing Club. They wouldn't let me join.

download.jpeg

FD has the impressive ability to filter out the noise and sees a real advantage to MNCPX despite its longer-term relative weakness. FD is president of the YRC.

N.

Edit: Chang, sorry we posted simultaneously, didn't see yours.

 

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Re: PMZIX


@norbertc wrote:

Comparing PMZIX to MNCPX is a good example of where I see things differently than FD. Screenshot_20200624-103816.png

Over five years, PMZIX wipes the floor with MNCPX. Both experienced a similar drop early 2020. But, MNCPX has outperformed during the very recent past.

Me, I note the recent outperformance, but would not buy the fund for that reason. I see short-term moves as mostly noise. However, I am not a member of the Yugo Racing Club. They wouldn't let me join.

download.jpeg

FD has the impressive ability to filter out the noise and sees a real advantage to MNCPX despite its longer-term relative weakness. FD is president of the YRC.

N.

Edit: Chang, sorry we posted simultaneously, didn't see yours.

 


Wow Norbi, so you went 5 years back and found the PMZIX did better, I can easily look 5 years back and find much better funds than PMZIX. The question is what to do now.  I used to like PMZIX as an alternative to higher volatility Multi sector funds but if I want to make more and/or have higher yield funds I would not use it and why I never invested in it long term.

BTW, I thought someone cares about fees...mmm...1.37% VS 0.5%. 

On a lighter note, I love your "deep" analysis looking into both funds or any funds in the last several years.  While I was recommending investing in USA stocks and load on QQQ where were you?

To the question of momentum, I do realize you can't do it successfully so why bother.  I remember many posters who loved DODGX just to find out it has been lagging the SP500 since 2007 with higher SD...or...admiring VG Prime cap growth just to find out that QQQ beat it, see 5 years (chart).

To the question of Yugo I can say the following 1) I did pretty well and much better risk-adjusted than most, definitely better than you.   2) I don't need a speedy car to get to work now and why I drive a minivan, I can get where I need to be a bit later and safer.  Yugo? nah, not even close, try harder.

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Re: PMZIX


@FD1001 wrote:

@chang wrote:

Based on the numbers you posted FD, PMZIX looks like the winner. 1-4 week numbers don’t mean anything to me. PMZIX just keeps grinding higher since the March dip. I don’t like expensive black boxes but I’m going to keep this one for now. Hopefully PIMCO knows more than Semper, Voya and the other suicidal-for-yield companies. I know, hope is not a strategy....


In my previous post, I didn't mention everything. MNCPX has better performance than PMZIX for 1-3-12 months + MNCPX ER=0.5% while PMZIX ER=1.37%.  Looks to me MNCPX is better.  Below are numbers as of today.

  Total ReturnTotal ReturnTotal ReturnReturnTotal ReturnTotal Return
ER
Ticker1 Week1 Month3 MonthYTD12 Month3 Year
0.50%MNCPX0.323.158.651.714.032.9
1.37%PMZIX0.061.687.430.953.253.18

 

YTD chart shows that PMZIX lost more money in the meltdown but also made less money on the uptrend.

While PMZIX invests almost everything in Securitized/MBS MNCPX is more diversified and I can find its bond rating (see below).

The min to buy MNCPX are as follow.  One million at Fidelity, Can't buy at Vanguard, only $2500 at Schwab with $49.95 fees.  Schwab proved again it's superiority.  You can buy EXCPX in all three ER=0.75% with no fees and low min.

mncpx.PNG

 

I used PMZIX this year for a short while because I didn't know about MNCPX.  Just my opinion, since 2018 the Pimco guys lost their mojo they had for years and why I haven't used their funds too much.  Up o 2018 I always had one of their funds especially PIMIX(Multi) and PHMIX(HY Muni). It's more than 2 years I can find better funds.


I owned PMZIX for a couple of months after the March crash, but I sold it and purchased JSIAX.  JSIAX is not the highest performing nontraditional bond oef, but it has a long history of being a low risk fund, that tends to hold a very high percentage in Investment Grade holdings.  I like the JSIAX portfolio holdings better than PMZIX, as a post crash longer term holding.  I passed on MNCPX because I did not want a fund with that high of a portfolio percentage in Corporates.  Others certainly may have a different view of Corporates, as an appropriate post crash criteria to consider in picking funds.

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Re: PMZIX

If you like PMZIX keep it. Right now I am analyzing high credit quality, short duration bond ETFs. Schwab ETF screener has turned up about a dozen possibilities.

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Re: PMZIX


@FD1001 wrote:

Wow Norbi, so you went 5 years back and found the PMZIX did better, I can easily look 5 years back and find much better funds than PMZIX. The question is what to do now.  I used to like PMZIX as an alternative to higher volatility Multi sector funds but if I want to make more and/or have higher yield funds I would not use it and why I never invested in it long term.

BTW, I thought someone cares about fees...mmm...1.37% VS 0.5%. 

On a lighter note, I love your "deep" analysis looking into both funds or any funds in the last several years.  While I was recommending investing in USA stocks and load on QQQ where were you?

To the question of momentum, I do realize you can't do it successfully so why bother.  I remember many posters who loved DODGX just to find out it has been lagging the SP500 since 2007 with higher SD...or...admiring VG Prime cap growth just to find out that QQQ beat it, see 5 years (chart).

To the question of Yugo I can say the following 1) I did pretty well and much better risk-adjusted than most, definitely better than you.   2) I don't need a speedy car to get to work now and why I drive a minivan, I can get where I need to be a bit later and safer.  Yugo? nah, not even close, try harder.


Don't feel bad. Hell, I don't even own a car, not even a Yugo. 

N.

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Re: PMZIX

Hi @chang

I think you are right about not using PMZIX for parking cash, even after the pandemic is over.  Currently, I am using VUSFX for that purpose but using VBIRX (BSV) instead of PMZIX makes sense.  

Hi @dtconroe

Agree that high corporates in any category (incl multi-sector) is skewing performance at this time and high corporates is not desirable if one has equity heavy portfolio where fixed income needs to serve more ballast function than if you have less equities.

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Re: PMZIX

I'm still not sure if I should be hanging on to a black box with a 1.37% gross ER.

Option 1: Merge PMZIX into PIGIX (I currently own approximately equal amounts). Comparing the two:

  • Yield:                  PMZIX 3.31%                   PIGIX 3.19%
  • Gross/Net ER:    PMZIX 1.37% / 0.60%     PIGIX 0.77% / 0.50%
  • YTD return:        PMZIX 1.20%                   PIGIX 2.04%
  • Duration:            PMZIX 1.12 years            PIGIX 7.69 years

I did a considerable amount of simplification and consolidation in May and June. Option 1 would be another step in this direction. Yield would remain about the same. I would be taking on more interest rate risk, while shedding MBS sector risk.

Here's a chart of the two funds.

Option 2: Merge PMZIX into BIV, my generic all-purpose bond fund (roughly equivalent, though slightly better, than BND). I would forfeit some yield, though.

Option 3: Do nothing.

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Re: PMZIX

Option 4: Sell both because they are black boxes and PIMCO is expensive...

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Re: PMZIX


@BigTom wrote:

Option 4: Sell both because they are black boxes and PIMCO is expensive...


Not an unreasonable option. Here is a chart of PIGIX vs. Vanguard's VFIDX and VICSX: link

The PIMCO fund actually has longer duration than either of the VG funds, but trails them both over 3 years, but that's due to the March crash.

As always, the rolling return chart is more instructive. This chart shows that PIGIX seems to do better than the VG funds both during bullish and bearish periods (early 2015 and late 2019 being an exception).

All PIMCO funds are black boxes to one degree or another, but I'm not convinced that PIGIX should be dumped just yet.

Add VWETX to the mix (link) and it's tempting to increase duration. Here's the rolling return view: link. That extra return obviously comes with a lot of volatility.

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