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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM N-CSR
CERTIFIED SHAREHOLDER REPORT OF REGISTERED MANAGEMENT
INVESTMENT COMPANIES
Investment Company Act file number: 811-22375
PIMCO Equity Series
(Exact name of registrant as specified in charter)
650 Newport Center Drive, Newport Beach, CA 92660
(Address of principal executive office)
Trent W. Walker
Treasurer (Principal Financial & Accounting Officer)
PIMCO Equity Series
650 Newport Center Drive, Newport Beach, CA 92660
(Name and address of agent for service)
Copies to:
Brendan C. Fox
Dechert LLP
1900 K Street, N.W.
Washington, D.C. 20006
Registrant’s telephone number, including area code: (888) 877-4626
Date of fiscal year end: June 30
Date of reporting period: December 31, 2015
Form N-CSR is to be used by management investment companies to file reports with the Commission not later than 10 days after the transmission to stockholders of any report that is required to be transmitted to stockholders under Rule 30e-1 under the Investment Company Act of 1940 (17 CFR 270.30e-1). The Commission may use the information provided on Form N-CSR in its regulatory, disclosure review, inspection, and policymaking roles.
A registrant is required to disclose the information specified by Form N-CSR, and the Commission will make this information public. A registrant is not required to respond to the collection of information contained in Form N-CSR unless the Form displays a currently valid Office of Management and Budget (“OMB”) control number. Please direct comments concerning the accuracy of the information collection burden estimate and any suggestions for reducing the burden to Secretary, Securities and Exchange Commission, 450 Fifth Street, NW, Washington, DC 20549-0609. The OMB has reviewed this collection of information under the clearance requirements of 44 U.S.C. § 3507
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Item 1. | Reports to Shareholders. |
The following is a copy of the report transmitted to shareholders pursuant to Rule 30e-1 under the Investment Company Act of 1940, as amended (the “1940 Act”) (17 CFR 270.30e-1).
• PIMCO Equity Series—Institutional, P, Administrative, D, A, C and R Classes
• PIMCO Equity Series RAE Fundamental Funds—Institutional, P, A and C Classes
• PIMCO Equity Series RealPathTM Blend Funds—Institutional, Administrative and A Classes
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PIMCO Equity Series®
Semiannual Report
December 31, 2015
PIMCO Balanced Income Fund
PIMCO Dividend and Income Builder Fund
PIMCO EqS® Long/Short Fund
PIMCO Global Dividend Fund
PIMCO International Dividend Fund
PIMCO U.S. Dividend Fund
Share Classes
n | Institutional |
n | P |
n | D |
n | A |
n | C |
n | R |
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82 | ||||||||
Approval of Investment Advisory Contract and Other Agreements | 83 | |||||||
87 | ||||||||
Fund | Fund Summary | Schedule of Investments | ||||||
6 | 32 | |||||||
8 | 41 | |||||||
10 | 48 | |||||||
12 | 53 | |||||||
14 | 57 | |||||||
16 | 61 |
This material is authorized for use only when preceded or accompanied by the current PIMCO Equity Series prospectus. The Shareholder Reports for the other series of the PIMCO Equity Series are printed separately.
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Dear Shareholder,
Please find enclosed the Semiannual Report for the PIMCO Equity Series covering the six-month reporting period ended December 31, 2015. The following pages contain specific details about the investment performance of each fund and a discussion of the factors that most affected performance during the reporting period.
Highlights of the financial markets during the six-month reporting period include:
n | Heightened market volatility throughout the reporting period was sparked by a mix of investor concerns including geopolitical developments, monetary policy and the potential for slowing global economic growth, which generally contributed to dampened investor sentiment. In particular, increasing concern over the outlook for Chinese growth sent commodity prices and inflation expectations lower, while also negatively impacting prices of emerging market (“EM”) debt and equities. In addition, the Chinese equity market began a strong decline in June 2015, which prompted the Chinese government to prop-up equity share prices and devalue the Chinese yuan. Volatility in Chinese equity markets continued into January 2016 on renewed concern over slowing Chinese economic growth. Furthermore, rising tension in the Middle East and the continued debt crisis in Greece also contributed to investor unease throughout the reporting period. |
n | Economic data in the U.S. continued to confirm a healthy economy, particularly labor market indicators such as employment and wages. Still, signs of caution remained, particularly as U.S. consumers appeared to be more selective in their spending and chose to save rather than spend their windfall from lower gas prices. Additionally, consumer sentiment and certain housing indicators softened towards the end of the reporting period, and December 2015 U.S. manufacturing data indicated the fastest contraction in six years. Within the Eurozone, volatility increased despite gradual improvement in the underlying economies. Eurozone economic data also showed generally positive signs of an early recovery but were tempered slightly by sluggish inflation. |
n | The theme of divergent global central bank monetary policy continued throughout the reporting period. The European Central Bank (“ECB”) expressed its commitment to increase quantitative easing (or large-scale asset purchases), along with the Bank of Japan and the People’s Bank of China who also indicated their intent to accelerate such measures. The Federal Reserve (“Fed”), on the other hand, moved on December 16 to raise the Federal Funds Rate by 0.25% to a new range of 0.25% – 0.50%, marking its first rate hike in nine years. However, the Fed noted that future increases in its target rate would be “gradual” and in-line with their previous projections, which helped to ease investor concerns. Outside of the reporting period on January 27, the Fed opted to leave the Federal Funds Rate unchanged, noting their intent to closely monitor how the global economy and markets influence the U.S. economic outlook. |
n | U.S. equities, as represented by the S&P 500 Index, returned 0.15% due to an improving economic outlook and stronger jobs growth. Internationally, equity markets experienced weak performance, as the MSCI EAFE Net Dividend Index (USD Hedged) declined 3.13% and the MSCI EAFE Net Dividend Index (USD Unhedged) declined 6.01% over the reporting period. During the first half of the reporting period, declining commodities prices and China’s economic deceleration drove concerns of slowing global growth, which weighed on equities. However, in the last half of the reporting period, developed market equities rebounded from lows reached in the first half as the theme of diverging monetary policy came into focus with the Federal Reserve raising interest rates for the first time in nearly a decade, while central banks around the world continued to implement accommodative monetary policies. |
n | Emerging market (“EM”) equities, as represented by the MSCI Emerging Markets Index (Net Dividends in USD), declined 17.36% over the reporting period. Concerns over China’s struggling economy continued as weak data and several attempts to support the Chinese equity market by the People’s Bank of China added to fears of slowing global growth. In addition, Brazil’s economic and political woes continued over the reporting period as the country’s credit rating was downgraded by S&P and Fitch to sub-investment grade, while President Dilma Rousseff faced increased scrutiny over her ability to revive the country’s economy. |
2 | PIMCO EQUITY SERIES |
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n | Style-wise, growth equities outperformed value equities globally as the MSCI All Country World Growth Index (Net Dividends in USD) declined 3.13% and the MSCI All Country World Value Index (Net Dividends in USD) declined 6.68%. In general, the consumer staples and information technology sectors were the top performing equity sectors, while the energy and materials sectors were the worst performing equity sectors over the reporting period. |
n | U.S. Treasuries, as represented by the Barclays U.S. Treasury Index, returned 0.81% for the reporting period. Longer-maturity yields (i.e., ten to thirty year yields) declined, with prices therefore higher, while shorter-maturity yields (i.e., six month to seven year yields) rose. The benchmark ten-year U.S. Treasury note yielded 2.27% at the end of the reporting period, down from 2.35% on June 30, 2015. The Barclays U.S. Aggregate Index, a widely used index of U.S. investment-grade bonds, returned 0.65% for the reporting period. |
If you have any questions regarding the PIMCO Equity Series, please contact your account manager or financial adviser, or call one of our shareholder associates at 888.87.PIMCO (888.877.4626). We also invite you to visit our website at www.pimco.com to learn more about our views and global thought leadership.
Thank you again for the trust you have placed in us. We value your commitment and will continue to work diligently to meet your broad investment needs.
![]() | Sincerely,
Brent R. Harris Chairman of the Board,
February 22, 2016
|
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 3 |
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Important Information About the Funds
We believe that equity funds have an important role to play in a well diversified investment portfolio. It is important to note, however, that equity funds are subject to notable risks. Among other things, equity and equity-related securities may decline in value due to both real and perceived general market, economic, and industry conditions.
The values of equity securities, such as common stocks and preferred stocks, have historically risen and fallen in periodic cycles and may decline due to general market conditions, which are not specifically related to a particular company, such as real or perceived adverse economic conditions, changes in the general outlook for corporate earnings, changes in interest or currency rates or adverse investor sentiment generally. Equity securities may also decline due to factors that affect a particular industry or industries, such as labor shortages, increased production costs and competitive conditions within an industry. In addition, the value of an equity security may decline for a number of reasons that directly relate to the issuer, such as management performance, financial leverage and reduced demand for the issuer’s goods or services, as well as the historical and prospective earnings of the issuer and the value of its assets. Different types of equity securities may react differently to these developments and a change in the financial condition of a single issuer may affect securities markets as a whole.
During a general downturn in the securities markets, multiple asset classes, including equity securities, may decline in value simultaneously. The market price of equity securities owned by a Fund may go up or down, sometimes rapidly or unpredictably. Equity securities generally have greater price volatility than fixed income securities and common stocks generally have the greatest appreciation and depreciation potential of all equity securities.
The Funds may be subject to various risks as described in the Funds’ prospectus. Some of these risks may include, but are not limited to, the following: new/small fund risk, equity risk, dividend-oriented stocks risk, value investing risk, foreign (non-U.S.) investment risk, emerging markets risk, sovereign debt risk, market risk, issuer risk, interest rate risk, call risk, credit risk, high yield and distressed company risk, cash holdings risk, currency risk, real estate risk, liquidity risk, leveraging risk, issuer non-diversification risk, management risk, small-cap and mid-cap company risk, derivatives risk, mortgage-related and other asset-backed securities risk, short sale risk and convertible securities risk. A complete description of these and other risks is contained in the Funds’ prospectus.
The Funds may use derivative instruments for hedging purposes or as part of an investment strategy. Use of these instruments may involve certain costs and risks such as liquidity risk, interest rate risk, market risk, credit risk, leverage risk, management risk and the risk that a Fund
may not be able to close out a position when it would be most advantageous to do so. Certain derivative transactions may have a leveraging effect on a Fund. For example, a small investment in a derivative instrument may have a significant impact on a Fund’s exposure to interest rates, currency exchange rates or other investments. As a result, a relatively small price movement in an asset, instrument or component of the index underlying a derivative instrument may cause an immediate and substantial loss or gain, which translates into heightened volatility for the Funds. A Fund may engage in such transactions regardless of whether the Fund owns the asset, instrument or components of the index underlying the derivative instrument. A Fund may invest a significant portion of its assets in these types of instruments. If it does, the Fund’s investment exposure could far exceed the value of its portfolio securities and its investment performance could be primarily dependent upon securities it does not own. Investing in foreign (non-U.S.) securities may entail risk due to foreign (non-U.S.) economic and political developments; this risk may be increased when investing in emerging markets.
The value of an equity security of an issuer that has paid dividends in the past may decrease if the issuer reduces or eliminates future payments to its shareholders. If the dividends or distributions received by a Fund decrease, the Fund may have less income to distribute to the Fund’s shareholders. In addition, during certain market conditions, the equity securities of issuers that have paid regular dividends or distributions may not be widely available or may be highly concentrated in particular sectors of the market. A Fund may invest a significant portion of its assets in value stocks. Value stocks may perform differently from other types of stocks and the market as a whole. A value stock may decrease in price or may not increase in price as anticipated by PIMCO if it continues to be undervalued by the market or the factors that the portfolio manager believes will cause the stock price to increase do not occur.
The geographical classification of foreign (non-U.S.) securities in this report are classified by the country of incorporation of a holding. In certain instances, a security’s country of incorporation may be different from its country of economic exposure.
On each individual Fund Summary page in this Shareholder Report, the Average Annual Total Return table and Cumulative Returns chart measure performance assuming that any dividend and capital gain distributions were reinvested. Class A shares are subject to an initial sales charge. A Contingent Deferred Sales Charge (“CDSC”) may be imposed in certain circumstances on Class A shares that are purchased without an initial sales charge and then redeemed during the first (i) 18 months after purchase for purchases made prior to August 10, 2015 and (ii) 12 months after purchase for purchases made on or after August 10, 2015. The Cumulative Returns chart reflects only Institutional Class performance.
4 | PIMCO EQUITY SERIES |
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Performance for Class P, Administrative Class, Class D, Class A, Class C and Class R shares, if applicable, are typically lower than Institutional Class performance due to the lower expenses paid by Institutional Class shares. Performance shown is net of fees and expenses. A Fund’s total annual operating expense ratios on each individual Fund Summary page are as of the currently effective prospectus, as supplemented to date. The Cumulative Returns chart assumes the initial investment of $1,000,000 was made at the end of the month that the Institutional Class of the relevant Fund commenced operations. The minimum initial investment
amount for Institutional Class, Class P and Administrative Class shares is $1,000,000. The minimum initial investment amount for Class A, Class C and Class D shares is $1,000. There is no minimum initial investment for Class R shares. Each Fund measures its performance against a broad-based securities market index (“benchmark index”). The benchmark index does not take into account fees, expenses, or taxes. A Fund’s past performance, before and after taxes, is not necessarily an indication of how the Fund will perform in the future.
The following table discloses the inception dates of each Fund and its respective share classes along with each Fund’s diversification status as of period end:
Fund Name | Fund Inception | Institutional Class | Class P | Class D | Class A | Class C | Class R | Diversification Status | ||||||||||||||||||||||||
PIMCO Balanced Income Fund | 03/31/14 | 03/31/14 | 03/31/14 | 03/31/14 | 03/31/14 | 03/31/14 | — | Diversified | ||||||||||||||||||||||||
PIMCO Dividend and Income Builder Fund | 12/14/11 | 12/14/11 | 12/14/11 | 12/14/11 | 12/14/11 | 12/14/11 | 12/14/11 | Diversified | ||||||||||||||||||||||||
PIMCO EqS® Long/Short Fund | 04/20/12 | 04/20/12 | 04/30/12 | 04/30/12 | 04/30/12 | 04/30/12 | — | Non-diversified | ||||||||||||||||||||||||
PIMCO Global Dividend Fund | 12/14/11 | 12/14/11 | 12/14/11 | 12/14/11 | 12/14/11 | 12/14/11 | 12/14/11 | Diversified | ||||||||||||||||||||||||
PIMCO International Dividend Fund | 12/15/14 | 12/15/14 | 12/15/14 | 12/15/14 | 12/15/14 | 12/15/14 | — | Diversified | ||||||||||||||||||||||||
PIMCO U.S. Dividend Fund | 12/15/14 | 12/15/14 | 12/15/14 | 12/15/14 | 12/15/14 | 12/15/14 | — | Diversified |
An investment in a Fund is not a bank deposit and is not guaranteed or insured by the Federal Deposit Insurance Corporation (“FDIC”) or any other government agency. It is possible to lose money on investments in a Fund.
The Trustees are responsible generally for overseeing the management of the Trust. The Trustees authorize the Trust to enter into service agreements with the Adviser, the Distributor, the Administrator and other service providers in order to provide, and in some cases authorize service providers to procure through other parties, necessary or desirable services on behalf of the Trust and the Funds. Shareholders are not parties to or third-party beneficiaries of such service agreements. Neither a Fund’s prospectus nor a Fund’s summary prospectus, the Trust’s Statement of Additional Information (“SAI”), any contracts filed as exhibits to the Trust’s registration statement, nor any other communications, disclosure documents or regulatory filings (including this report) from or on behalf of the Trust or a Fund creates a contract between or among any shareholder of a Fund, on the one hand, and the Trust, a Fund, a service provider to the Trust or a Fund, and/or the Trustees or officers of the Trust, on the other hand. The Trustees (or the Trust and its officers, service providers or other delegates acting under authority of the Trustees) may amend the most recent prospectus or use a new prospectus, summary prospectus or SAI with respect to a Fund or the Trust, and/or amend, file and/or issue any other communications, disclosure documents or regulatory filings, and may amend or enter into any contracts to which the Trust or a Fund is a party, and interpret the investment objective(s), policies, restrictions and contractual provisions applicable to any Fund, without shareholder
input or approval, except in circumstances in which shareholder approval is specifically required by law (such as changes to fundamental investment policies) or where a shareholder approval requirement is specifically disclosed in the Trust’s then-current prospectus or SAI.
PIMCO has adopted written proxy voting policies and procedures (“Proxy Policy”) as required by Rule 206(4)-6 under the Investment Advisers Act of 1940, as amended. The Proxy Policy has been adopted by PIMCO Equity Series as the policies and procedures that PIMCO will use when voting proxies on behalf of a Fund. A description of the policies and procedures that PIMCO uses to vote proxies relating to portfolio securities of a Fund, and information about how the Fund voted proxies relating to portfolio securities held during the most recent twelve-month period ended June 30th, are available without charge, upon request, by calling the Trust at (888) 87-PIMCO, on the Fund’s website at www.pimco.com, and on the Securities and Exchange Commission’s (“SEC”) website at www.sec.gov.
PIMCO Equity Series files a complete schedule of each Fund’s portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. A copy of a Fund’s Form N-Q is available on the SEC’s website at www.sec.gov and may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. A Fund’s Form N-Q will also be available without charge, upon request, by calling the Trust at (888) 87-PIMCO and on the Fund’s website at www.pimco.com. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 5 |
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Cumulative Returns Through December 31, 2015
Investment Objective and Strategy Overview
» | The PIMCO Balanced Income Fund seeks to maximize current income while providing long-term capital appreciation by investing under normal circumstances in a diversified portfolio of income-producing equity and fixed income securities, each of which may be represented by forwards or derivatives such as options, futures contracts, or swap agreements. The Fund will typically invest at least 25% of its net assets in equity and equity related securities and at least 25% of its net assets in fixed income securities. The Fund’s investments in equity and equity-related securities include common and preferred stock (and securities convertible into, or that PIMCO expects to be exchanged for, common or preferred stock), as well as securities issued by real estate investment trusts, master limited partnerships and other equity trusts and depositary receipts. |
Average Annual Total Return for the period ended December 31, 2015 | ||||||||||||||
6 Months* | 1 Year | Fund Inception (03/31/14) | ||||||||||||
![]() | PIMCO Balanced Income Fund Institutional Class | (7.71)% | �� | (5.96)% | (2.00)% | |||||||||
PIMCO Balanced Income Fund Class P | (7.76)% | (6.06)% | (2.10)% | |||||||||||
PIMCO Balanced Income Fund Class D | (7.88)% | (6.39)% | (2.34)% | |||||||||||
PIMCO Balanced Income Fund Class A | (7.88)% | (6.39)% | (2.34)% | |||||||||||
PIMCO Balanced Income Fund Class A (adjusted) | (12.91)% | (11.52)% | (5.43)% | |||||||||||
PIMCO Balanced Income Fund Class C | (8.26)% | (7.12)% | (3.09)% | |||||||||||
PIMCO Balanced Income Fund Class C (adjusted) | (9.14)% | (8.01)% | (3.09)% | |||||||||||
![]() | MSCI All Country World Index± | (4.90)% | (2.36)% | 0.35% | ||||||||||
![]() | 50% MSCI ACWI/50% Barclays Global Aggregate Index hedged USD±± | (1.64)% | (0.46)% | 2.14% |
All Fund returns are net of fees and expenses.
* Cumulative return.
± The MSCI All Country World Index is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed and emerging markets. The Index consists of 46 country indices comprising 23 developed and 23 emerging market country indices.
±± The benchmark is a blend of 50% MSCI All Country World Index/50% Barclays Global Aggregate USD Hedged. The MSCI All Country World Index is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed and emerging markets. The Index consists of 46 country indices comprising 23 developed and 23 emerging market country indices. Barclays Global Aggregate (USD Hedged) Index provides a broad-based measure of the global investment-grade fixed income markets. The three major components of this index are the U.S. Aggregate, the Pan-European Aggregate, and the Asian-Pacific Aggregate Indices. The index also includes Eurodollar and Euro-Yen corporate bonds, Canadian Government securities, and USD investment grade 144A securities.
It is not possible to invest directly in an unmanaged index.
Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Current performance may be lower or higher than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The adjusted returns take into account the maximum sales charge of 5.50% on Class A shares and 1.00% CDSC on Class C shares. The Fund’s total annual operating expense ratio as stated in the Fund’s current prospectus, as supplemented to date, is 1.03% for the Institutional Class shares, 1.13% for the Class P shares, 1.38% for the Class D shares, 1.38% for the Class A shares, and 2.13% for the Class C shares. Details regarding any Fund’s operating expenses can be found in the Fund’s prospectus. For performance current to the most recent month-end, visit www.pimco.com.
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Institutional Class - PBITX | Class P - PBIEX | Class D - PBIDX | Class A - PBIAX | Class C - PBICX |
Top 10 Holdings1
U.S. Treasury Bonds | 2.9% | |||||
QUALCOMM, Inc. | 2.5% | |||||
PG&E Corp. | 2.5% | |||||
Vodafone Group PLC | 2.4% | |||||
AT&T, Inc. | 2.2% | |||||
HSBC Holdings PLC | 2.1% | |||||
Colony Capital, Inc. ‘A’ | 2.1% | |||||
AbbVie, Inc. | 1.9% | |||||
Pfizer, Inc. | 1.9% | |||||
Roche Holding AG | 1.8% |
Geographic Breakdown1
United States | 54.4% | |||||
United Kingdom | 8.8% | |||||
Netherlands | 3.4% | |||||
Australia | 3.2% | |||||
Brazil | 2.6% | |||||
Italy | 2.3% | |||||
France | 2.2% | |||||
Hong Kong | 1.9% | |||||
Switzerland | 1.9% | |||||
Taiwan | 1.2% | |||||
Greece | 1.2% | |||||
Canada | 1.1% | |||||
Cayman Islands | 1.0% | |||||
Other | 3.4% |
Sector Breakdown1
Financials | 16.3% | |||||
Asset-Backed Securities | 10.8% | |||||
Health Care | 8.0% | |||||
Telecommunication Services | 8.0% | |||||
Information Technology | 7.5% | |||||
Consumer Discretionary | 7.0% | |||||
Utilities | 5.7% | |||||
Industrials | 5.4% | |||||
Non-Agency Mortgage-Backed Securities | 5.1% | |||||
U.S. Treasury Obligations | 4.4% | |||||
Consumer Staples | 3.0% | |||||
Materials | 2.1% | |||||
Bank Loan Obligations | 2.0% | |||||
Energy | 1.8% | |||||
Sovereign Issues | 1.5% |
1 % of Investments, at value as of 12/31/2015. Top 10 Holdings, Geographic and Sector Breakdowns solely reflect long positions. Securities sold short, financial derivative instruments and short-term instruments are not taken into consideration.
Fund Insights
» | During the reporting period, the Fund paid ordinary quarterly dividends totaling 24 cents per share on its Institutional class shares. The dividend per share was slightly lower for the other share classes to account for varying class-specific expenses. |
» | Stock selection within the commercial services & supplies industry detracted from relative returns, as the Fund’s overweight position in Spotless Group Holdings within this industry significantly underperformed the MSCI All Country World Index over the reporting period. |
» | An overweight exposure to small-cap companies detracted from relative performance, as small-cap stocks underperformed the MSCI All Country World Index over the reporting period. |
» | Over the reporting period, the top three equity contributors were NN Group NV, Ameren Corporation and Imperial Tobacco Group PLC. The top three equity detractors were Spotless Group Holdings Ltd, Golar LNG Partners LP and Targa Resources Corp. |
» | The Fund’s fixed income allocation underperformed its fixed income benchmark, Barclays Global Aggregate USD Unhedged, primarily driven by exposure to Brazilian 30-year duration as Brazilian 30-year yields generally rose over the reporting period. |
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PIMCO Dividend and Income Builder Fund
Cumulative Returns Through December 31, 2015
Investment Objective and Strategy Overview
» | The PIMCO Dividend and Income Builder Fund seeks to provide current income that exceeds the average yield on global stocks, and to provide a growing stream of income per share over time, with a secondary objective to seek to provide long-term capital appreciation, by investing under normal circumstances at least 80% of its assets in a diversified portfolio of income-producing investments, and will typically invest at least 50% of its assets in equity and equity-related securities. The Fund’s investments in equity and equity-related securities include common and preferred stock (and securities convertible into, or that PIMCO expects to be exchanged for, common or preferred stock), as well as securities issued by real estate investment trusts, master limited partnerships and other equity trusts and depositary receipts. |
Average Annual Total Return for the period ended December 31, 2015 | ||||||||||||||
6 Months* | 1 Year | Fund Inception (12/14/11) | ||||||||||||
![]() | PIMCO Dividend and Income Builder Fund Institutional Class | (11.30)% | (9.70)% | 6.33% | ||||||||||
PIMCO Dividend and Income Builder Fund Class P | (11.42)% | (9.80)% | 6.23% | |||||||||||
PIMCO Dividend and Income Builder Fund Class D | (11.56)% | (10.04)% | 5.95% | |||||||||||
PIMCO Dividend and Income Builder Fund Class A | (11.47)% | (9.96)% | 5.98% | |||||||||||
PIMCO Dividend and Income Builder Fund Class A (adjusted) | (16.37)% | (14.93)% | 4.51% | |||||||||||
PIMCO Dividend and Income Builder Fund Class C | (11.85)% | (10.68)% | 5.17% | |||||||||||
PIMCO Dividend and Income Builder Fund Class C (adjusted) | (12.66)% | (11.49)% | 5.17% | |||||||||||
PIMCO Dividend and Income Builder Fund Class R | (11.59)% | (10.26)% | 5.73% | |||||||||||
![]() | MSCI All Country World Index± | (4.90)% | (2.36)% | 10.58% | ||||||||||
![]() | 75% MSCI All Country World Index/25% Barclays Global Aggregate USD Unhedged±± | (3.60)% | (2.40)% | 7.95% |
All Fund returns are net of fees and expenses.
* Cumulative return.
± The MSCI All Country World Index is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed and emerging markets. The Index consists of 46 country indices comprising 23 developed and 23 emerging market country indices.
±± The benchmark is a blend of 75% MSCI All Country World Index/25% Barclays Global Aggregate USD Unhedged. The MSCI All Country World Index is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed and emerging markets. The Index consists of 46 country indices comprising 23 developed and 23 emerging market country indices. Barclays Global Aggregate (USD Unhedged) Index provides a broad-based measure of the global investment-grade fixed income markets. The three major components of this index are the U.S. Aggregate, the Pan-European Aggregate, and the Asian-Pacific Aggregate Indices. The index also includes Eurodollar and Euro-Yen corporate bonds, Canadian Government securities, and USD investment grade 144A securities.
It is not possible to invest directly in an unmanaged index.
Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Current performance may be lower or higher than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The adjusted returns take into account the maximum sales charge of 5.50% on Class A shares and 1.00% CDSC on Class C shares. The Fund’s total annual operating expense ratio as stated in the Fund’s current prospectus, as supplemented to date, is 1.20% for the Institutional Class shares, 1.30% for the Class P shares, 1.55% for the Class D shares, 1.55% for the Class A shares, 2.30% for the Class C shares, and 1.80% for Class R shares. Details regarding any Fund’s operating expenses can be found in the Fund’s prospectus. For performance current to the most recent month-end, visit www.pimco.com.
8 | PIMCO EQUITY SERIES |
Table of Contents
Institutional Class - PQIIX | Class P - PQIPX | Class D - PQIDX | Class A - PQIZX | Class C - PQICX | Class R - PQIBX |
Top 10 Holdings1
PG&E Corp. | 3.7% | |||||
QUALCOMM, Inc. | 3.7% | |||||
AT&T, Inc. | 3.6% | |||||
Vodafone Group PLC | 3.6% | |||||
HSBC Holdings PLC | 3.2% | |||||
Colony Capital, Inc. ‘A’ | 3.2% | |||||
AbbVie, Inc. | 2.8% | |||||
Pfizer, Inc. | 2.8% | |||||
Roche Holding AG | 2.8% | |||||
Lloyds Banking Group PLC | 2.8% |
Geographic Breakdown1
United States | 50.3% | |||||
United Kingdom | 13.5% | |||||
Australia | 5.1% | |||||
Netherlands | 4.2% | |||||
Italy | 3.8% | |||||
France | 3.3% | |||||
Hong Kong | 2.8% | |||||
Switzerland | 2.8% | |||||
Brazil | 2.2% | |||||
Taiwan | 1.8% | |||||
Canada | 1.6% | |||||
Japan | 1.4% | |||||
Spain | 1.4% | |||||
Greece | 1.3% | |||||
Germany | 1.0% | |||||
Other | 2.3% |
Sector Breakdown1
Financials | 22.4% | |||||
Telecommunication Services | 12.2% | |||||
Health Care | 12.1% | |||||
Information Technology | 11.1% | |||||
Consumer Discretionary | 10.7% | |||||
Utilities | 8.4% | |||||
Industrials | 6.4% | |||||
Consumer Staples | 4.5% | |||||
Materials | 3.3% | |||||
Energy | 2.9% | |||||
Non-Agency Mortgage-Backed Securities | 2.1% | |||||
Asset-Backed Securities | 2.0% | |||||
Other | 0.7% |
1 % of Investments, at value as of 12/31/2015. Top 10 Holdings, Geographic and Sector Breakdowns solely reflect long positions. Securities sold short, financial derivative instruments and short-term instruments are not taken into consideration.
Fund Insights
» | During the reporting period, the Fund paid ordinary quarterly dividends totaling 20 cents per share on its Institutional class shares. The dividend per share was slightly lower for the other share classes to account for varying class-specific expenses. |
» | Stock selection within the commercial services & supplies industry detracted from relative returns, as the Fund’s overweight to Spotless Group Holdings within this industry significantly underperformed the MSCI All Country World Index over the reporting period. |
» | An overweight exposure to small-cap companies detracted from relative performance, as small-cap stocks underperformed the MSCI All Country World Index over the reporting period. |
» | Over the reporting period, the top three equity contributors were NN Group NV, Imperial Tobacco Group PLC and Ameren Corporation. The top three equity detractors were Spotless Group Holdings Ltd, Targa Resources Corp. and Golar LNG Partners LP. |
» | The Fund’s fixed income allocation outperformed its fixed income benchmark, Barclays Global Aggregate USD Unhedged, primarily driven by select currency underweights specifically to the euro and the British pound, as these currencies underperformed versus the U.S. dollar over the reporting period. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 9 |
Table of Contents
Cumulative Returns Through December 31, 2015*
Investment Objective and Strategy Overview
» | The PIMCO EqS® Long/Short Fund seeks long-term capital appreciation by investing under normal circumstances in long and short positions of equity and equity-related securities, including common and preferred stock (and securities convertible into, or that PIMCO expects to be exchanged for, common or preferred stock), utilizing a fundamental investing style that integrates bottom-up and top-down research. The Fund will normally invest a substantial portion of its assets in equity and equity-related securities. The Fund may also invest in fixed income securities of varying maturities, cash and cash equivalents. |
Average Annual Total Return for the period ended December 31, 2015* | ||||||||||||||||||||||
6 Months** | 1 Year | 5 Year | 10 Year | Fund Inception (01/01/03) | ||||||||||||||||||
PIMCO EqS® Long/Short Fund Institutional Class | (2.27)% | 0.82% | 4.79% | 8.86% | 11.75% | |||||||||||||||||
PIMCO EqS® Long/Short Fund Class P | (2.28)% | 0.74% | 4.74% | 8.84% | 11.73% | |||||||||||||||||
PIMCO EqS® Long/Short Fund Class D | (2.46)% | 0.49% | 4.51% | 8.72% | 11.64% | |||||||||||||||||
PIMCO EqS® Long/Short Fund Class A | (2.46)% | 0.49% | 4.51% | 8.72% | 11.64% | |||||||||||||||||
PIMCO EqS® Long/Short Fund Class A (adjusted) | (7.79)% | (5.01)% | 3.34% | 8.11% | 11.15% | |||||||||||||||||
PIMCO EqS® Long/Short Fund Class C | (2.86)% | (0.30)% | 3.93% | 8.41% | 11.40% | |||||||||||||||||
PIMCO EqS® Long/Short Fund Class C (adjusted) | (3.82)% | (1.28)% | 3.93% | 8.41% | 11.40% | |||||||||||||||||
3 Month USD LIBOR Index± | 0.15% | 0.29% | 0.32% | 1.68% | 1.76% |
All Fund returns are net of fees and expenses.
** Cumulative return.
± The 3 Month USD LIBOR (London Interbank Offered Rate) Index is an average interest rate, determined by the ICE Benchmark Administration, that banks charge one another for the use of short-term money (3 months) in England’s Eurodollar market. It is not possible to invest in an unmanaged index.
It is not possible to invest directly in an unmanaged index.
Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Current performance may be lower or higher than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The adjusted returns take into account the maximum sales charge of 5.50% on Class A shares and 1.00% CDSC on Class C shares. The Fund’s total annual operating expense ratio as stated in the Fund’s current prospectus, as supplemented to date, is 1.91% for the Institutional Class shares, 2.01% for the Class P shares, 2.26% for the Class D shares, 2.26% for the Class A shares, and 3.01% for the Class C shares. Details regarding any Fund’s operating expenses can be found in the Fund’s prospectus. For performance current to the most recent month-end, visit www.pimco.com.
* For periods prior to April 20, 2012, the Fund’s performance reflects the performance when the Fund was a partnership, net of actual fees and expenses charged to individual partnership accounts in the aggregate. If the performance had been restated to reflect the applicable fees and expenses of each share class, the performance may have been higher or lower. The Fund began operations as a partnership on January 1, 2003 and, on April 20, 2012, was reorganized into a newly-formed fund that was registered as an investment company under the Investment Company Act of 1940. Prior to the reorganization, the Fund had an investment objective, investment strategies, investment guidelines, and restrictions that were substantially similar to those currently applicable to the Fund; however, the Fund was not registered as an investment company under the Investment Company Act of 1940 and was not subject to its requirements or requirements imposed by the Internal Revenue Code of 1986 which, if applicable, may have adversely affected its performance. The performance of Class P, D, A and C shares for the period from April 20, 2012 to April 30, 2012 is based on the performance of the Institutional Class shares of the Fund adjusted to reflect the fees and expenses of Class P, D, A and C shares (as applicable). The performance of each class of shares will differ as a result of the different levels of fees and expenses applicable to each class of shares.
10 | PIMCO EQUITY SERIES |
Table of Contents
Institutional Class - PMHIX | Class P - PMHBX | Class D - PMHDX | Class A - PMHAX | Class C - PMHCX |
Top 10 Holdings1
First Data Corp. ‘A’ | 5.7% | |||||
Iron Mountain, Inc. | 5.3% | |||||
Laboratory Corp. of America Holdings | 4.8% | |||||
KAR Auction Services, Inc. | 4.2% | |||||
DST Systems, Inc. | 3.8% | |||||
Live Nation Entertainment, Inc. | 2.9% | |||||
Nordstrom, Inc. | 2.6% | |||||
Level 3 Communications, Inc. | 2.5% | |||||
Bank of New York Mellon Corp. | 2.3% | |||||
Alphabet, Inc. ‘C’ | 2.3% |
Sector Breakdown2
Information Technology | 13.3% | |||||
Financials | 7.5% | |||||
Health Care | 5.3% | |||||
Telecommunication Services | 2.5% |
1 % of Investments, at value as of 12/31/2015. Top 10 Holdings solely reflect long positions. Securities sold short, derivatives, and short-term instruments are not taken into consideration.
2 % of net exposure (Investments, at value less Securities Sold Short) as of 12/31/2015. Financial derivative instruments and short-term instruments are not taken into consideration.
Fund Insights
» | The Fund’s long equity positions detracted from absolute returns, as prices of these securities generally declined during the reporting period. |
» | The Fund’s short equity positions within the materials sector contributed to absolute returns, as this sector declined over the reporting period. |
» | The Fund’s short equity positions within the energy sector contributed to absolute returns, as this sector declined over the reporting period. |
» | Over the reporting period, the Fund increased its gross short exposure from 22.6% to 37.2% and decreased its gross long exposure from 78.3% to 56.8%, reducing the overall net equity exposure from 55.7% to 19.6% of net assets. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 11 |
Table of Contents
Cumulative Returns Through December 31, 2015
Investment Objective and Strategy Overview
» | The PIMCO Global Dividend Fund seeks to provide current income that exceeds the average yield on global stocks, and as a secondary objective, seeks to provide long-term capital appreciation, by investing under normal circumstances at least 75% of its assets in equity and equity-related securities, including common and preferred stock (and securities convertible into, or that PIMCO expects to be exchanged for, common or preferred stock), as well as securities issued by real estate investment trusts, master limited partnerships and other equity trusts and depositary receipts. |
Average Annual Total Return for the period ended December 31, 2015 | ||||||||||||||
6 Months* | 1 Year | Fund Inception (12/14/11) | ||||||||||||
![]() | PIMCO Global Dividend Fund Institutional Class | (12.86)% | (10.99)% | 6.37% | ||||||||||
PIMCO Global Dividend Fund Class P | (12.87)% | (10.92)% | 6.32% | |||||||||||
PIMCO Global Dividend Fund Class D | (12.99)% | (11.15)% | 6.06% | |||||||||||
PIMCO Global Dividend Fund Class A | (12.99)% | (11.15)% | 6.06% | |||||||||||
PIMCO Global Dividend Fund Class A (adjusted) | (17.78)% | (16.04)% | 4.59% | |||||||||||
PIMCO Global Dividend Fund Class C | (13.45)% | (11.94)% | 5.19% | |||||||||||
PIMCO Global Dividend Fund Class C (adjusted) | (14.20)% | (12.70)% | 5.19% | |||||||||||
PIMCO Global Dividend Fund Class R | (13.15)% | (11.43)% | 5.77% | |||||||||||
![]() | MSCI All Country World Index± | (4.90)% | (2.36)% | 10.58% |
All Fund returns are net of fees and expenses.
* Cumulative return.
± The MSCI All Country World Index is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed and emerging markets. The Index consists of 46 country indices comprising 23 developed and 23 emerging market country indices.
It is not possible to invest directly in an unmanaged index.
Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Current performance may be lower or higher than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The adjusted returns take into account the maximum sales charge of 5.50% on Class A shares and 1.00% CDSC on Class C shares. The Fund’s total annual operating expense ratio as stated in the Fund’s current prospectus, as supplemented to date, is 1.07% for the Institutional Class shares, 1.17% for the Class P shares, 1.42% for the Class D shares, 1.42% for the Class A shares, 2.17% for the Class C shares and 1.67% for the Class R shares. Details regarding any Fund’s operating expenses can be found in the Fund’s prospectus. For performance current to the most recent month-end, visit www.pimco.com.
12 | PIMCO EQUITY SERIES |
Table of Contents
Institutional Class - PQDIX | Class P - PQDPX | Class D - PQDDX | Class A - PQDAX | Class C - PQDCX | Class R - PQDRX |
Top 10 Holdings1
Vodafone Group PLC | 3.5% | |||||
QUALCOMM, Inc. | 3.0% | |||||
AT&T, Inc. | 3.0% | |||||
PG&E Corp. | 3.0% | |||||
Lloyds Banking Group PLC | 3.0% | |||||
Western Digital Corp. | 2.9% | |||||
Aegon NV | 2.9% | |||||
Pfizer, Inc. | 2.7% | |||||
HSBC Holdings PLC | 2.7% | |||||
Intesa Sanpaolo SpA | 2.6% |
Geographic Breakdown1
United States | 51.6% | |||||
United Kingdom | 13.0% | |||||
Netherlands | 3.9% | |||||
Italy | 3.9% | |||||
Australia | 3.5% | |||||
Japan | 3.5% | |||||
France | 3.4% | |||||
Hong Kong | 2.5% | |||||
Switzerland | 2.2% | |||||
Brazil | 2.1% | |||||
Taiwan | 1.7% | |||||
Canada | 1.6% | |||||
Spain | 1.5% | |||||
Greece | 1.3% | |||||
Germany | 1.0% | |||||
Other | 0.9% |
1 % of Investments, at value as of 12/31/2015. Top 10 Holdings and Geographic Breakdown solely reflect long positions. Securities sold short, financial derivative instruments and short-term instruments are not taken into consideration.
Fund Insights
» | During the reporting period, the Fund paid ordinary quarterly dividends totaling 10 cents per share on its Institutional class shares. The dividend per share was slightly lower for the other share classes to account for varying class-specific expenses. |
» | Stock selection within the oil, gas & consumable fuels industry detracted from relative returns, as the Fund’s holdings within this industry significantly underperformed the MSCI All Country World Index over the reporting period. |
» | An overweight exposure to small-cap companies detracted from relative performance, as small-cap stocks underperformed the MSCI All Country World Index over the reporting period. |
» | Over the reporting period, the top three equity contributors were NN Group NV, PG&E Corporation and Imperial Tobacco Group PLC. The top three equity detractors were Targa Resources Corp., Golar LNG Partners LP and Spotless Group Holdings Ltd. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 13 |
Table of Contents
PIMCO International Dividend Fund
Cumulative Returns Through December 31, 2015
Investment Objective and Strategy Overview
» | The PIMCO International Dividend Fund seeks to provide current income that exceeds the average yield on international stocks, while providing long-term capital appreciation, by investing in an international-focused diversified portfolio of dividend-paying stocks that have an attractive yield, a growing dividend, and long-term capital appreciation. The Fund will invest primarily in equity and equity-related securities that are economically tied to developed and emerging markets outside the United States, including common and preferred stock (and securities convertible into, or that PIMCO expects to be exchanged for, common or preferred stock), as well as securities issued by real estate investment trusts, master limited partnerships and other equity trusts and depositary receipts. |
Average Annual Total Return for the period ended December 31, 2015 | ||||||||||||||
6 Months* | 1 Year | Fund Inception (12/15/14) | ||||||||||||
![]() | PIMCO International Dividend Fund Institutional Class | (12.88)% | (8.63)% | (6.90)% | ||||||||||
PIMCO International Dividend Fund Class P | (12.93)% | (8.73)% | (6.99)% | |||||||||||
PIMCO International Dividend Fund Class D | (13.04)% | (8.96)% | (7.23)% | |||||||||||
PIMCO International Dividend Fund Class A | (13.03)% | (8.86)% | (7.14)% | |||||||||||
PIMCO International Dividend Fund Class A (Adjusted) | (17.81)% | (13.87)% | (12.02)% | |||||||||||
PIMCO International Dividend Fund Class C | (13.40)% | (9.67)% | (7.95)% | |||||||||||
PIMCO International Dividend Fund Class C (Adjusted) | (14.24)% | (10.54)% | (7.95)% | |||||||||||
![]() | MSCI All Country World ex US Index± | (9.32)% | (5.66)% | (2.51)% |
All Fund returns are net of fees and expenses.
* Cumulative return.
± The MSCI All Country World ex US Index is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed and emerging markets. The Index consists of 45 country indices comprising 22 developed and 23 emerging market country indices.
It is not possible to invest directly in an unmanaged index.
Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Current performance may be lower or higher than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The adjusted returns take into account the maximum sales charge of 5.50% on Class A shares and 1.00% CDSC on Class C shares. The Fund’s total annual operating expense ratio as stated in the Fund’s current prospectus, as supplemented to date, is 0.99% for the Institutional Class shares, 1.09% for the Class P shares, 1.34% for the Class D shares, 1.34% for the Class A shares, and 2.09% for the Class C shares. Details regarding any Fund’s operating expenses can be found in the Fund’s prospectus. For performance current to the most recent month-end, visit www.pimco.com.
14 | PIMCO EQUITY SERIES |
Table of Contents
Institutional Class - PVIIX | Class P - PVIPX | Class D - PVIDX | Class A - PVIAX | Class C - PVICX |
Top 10 Holdings1
Vodafone Group PLC | 4.4% | |||||
Roche Holding AG | 4.1% | |||||
Aegon NV | 4.0% | |||||
Bridgestone Corp. | 4.0% | |||||
Lloyds Banking Group PLC | 4.0% | |||||
HSBC Holdings PLC | 4.0% | |||||
Intesa Sanpaolo SpA | 4.0% | |||||
Engie S.A. | 3.5% | |||||
China Mobile Ltd. | 3.4% | |||||
Taiwan Semiconductor Manufacturing Co. Ltd. | 3.2% |
Geographic Breakdown1
United Kingdom | 17.0% | |||||
United States | 14.4% | |||||
Japan | 9.5% | |||||
Australia | 8.2% | |||||
Netherlands | 7.1% | |||||
France | 6.4% | |||||
Hong Kong | 5.8% | |||||
Italy | 5.6% | |||||
Switzerland | 4.1% | |||||
Taiwan | 3.2% | |||||
Brazil | 3.1% | |||||
Canada | 2.3% | |||||
Ireland | 2.3% | |||||
Israel | 2.0% | |||||
Spain | 1.7% | |||||
China | 1.4% | |||||
Mexico | 1.4% | |||||
Germany | 1.3% | |||||
Greece | 1.3% | |||||
Other | 1.7% |
1 % of Investments, at value as of 12/31/2015. Top 10 Holdings and Geographic Breakdown solely reflect long positions. Securities sold short, financial derivative instruments and short-term instruments are not taken into consideration.
Fund Insights
» | During the reporting period, the Fund paid ordinary quarterly dividends totaling 15 cents per share on its Institutional class shares. The dividend per share was slightly lower for the other share classes to account for varying class-specific expenses. |
» | Stock selection within the electric utilities industry detracted from relative returns, as the Fund’s holdings within this industry significantly underperformed the MSCI All Country World ex-US Index over the reporting period. |
» | Stock selection within the oil, gas & consumable fuels industry detracted from relative returns, as the Fund’s holdings within this industry significantly underperformed the MSCI All Country World ex-US Index over the reporting period. |
» | Over the reporting period, the top three equity contributors were NN Group NV, Imperial Tobacco Group PLC and Lawson Inc. The top three equity detractors were Spotless Group Holdings Ltd., Golar LNG Partners LP and Total Access Communication Public Co., Ltd. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 15 |
Table of Contents
Cumulative Returns Through December 31, 2015
Investment Objective and Strategy Overview
» | The PIMCO U.S. Dividend Fund seeks to provide current income that exceeds the average yield on U.S. stocks, while providing long-term capital appreciation, by investing in a U.S.-focused diversified portfolio of dividend-paying stocks that have an attractive yield, a growing dividend, and long-term capital appreciation. The Fund will invest primarily in equity and equity-related securities that are economically tied to the United States, including common and preferred stock (and securities convertible into, or that PIMCO expects to be exchanged for, common or preferred stock), as well as securities issued by real estate investment trusts, master limited partnerships and other equity trusts and depositary receipts. |
Average Annual Total Return for the period ended December 31, 2015 | ||||||||||||||
6 Months* | 1 Year | Fund Inception (12/15/14) | ||||||||||||
![]() | PIMCO U.S. Dividend Fund Institutional Class | (12.98)% | (14.44)% | (10.41)% | ||||||||||
PIMCO U.S. Dividend Fund Class P | | (12.94)% | | (14.53)% | (10.51)% | |||||||||
PIMCO U.S. Dividend Fund Class D | | (13.06)% | | (14.76)% | (10.74)% | |||||||||
PIMCO U.S. Dividend Fund Class A | (13.13)% | (14.66)% | (10.64)% | |||||||||||
PIMCO U.S. Dividend Fund Class A (Adjusted) | (17.92)% | (19.39)% | (15.34)% | |||||||||||
PIMCO U.S. Dividend Fund Class C | (13.40)% | (15.33)% | (11.34)% | |||||||||||
PIMCO U.S. Dividend Fund Class C (Adjusted) | (14.24)% | (16.15)% | (11.34)% | |||||||||||
![]() | S&P 500 Index± | 0.15% | 1.38% | 4.78% |
All Fund returns are net of fees and expenses.
* Cumulative return.
± S&P 500 Index is an unmanaged market index generally considered representative of the stock market as a whole. The Index focuses on the large-cap segment of the U.S. equities market.
It is not possible to invest directly in an unmanaged index.
Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Current performance may be lower or higher than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The adjusted returns take into account the maximum sales charge of 5.50% on Class A shares and 1.00% CDSC on Class C shares. The Fund’s total annual operating expense ratio as stated in the Fund’s current prospectus, as supplemented to date, is 0.90% for the Institutional Class shares, 1.00% for the Class P shares, 1.25% for the Class D shares, 1.25% for the Class A shares, and 2.00% for the Class C shares. Details regarding any Fund’s operating expenses can be found in the Fund’s prospectus. For performance current to the most recent month-end, visit www.pimco.com.
16 | PIMCO EQUITY SERIES |
Table of Contents
Institutional Class - PVDIX | Class P - PVDPX | Class D - PVDDX | Class A - PVDAX | Class C - PVDCX |
Top 10 Holdings1
AT&T, Inc. | 5.5% | |||||
QUALCOMM, Inc. | 5.1% | |||||
Pfizer, Inc. | 5.0% | |||||
Comcast Corp. ‘A’ | 5.0% | |||||
PG&E Corp. | 5.0% | |||||
Neilsen Holdings PLC | 5.0% | |||||
AbbVie, Inc. | 4.6% | |||||
Apple, Inc. | 4.4% | |||||
Merck & Co., Inc. | 4.2% | |||||
Roche Holding AG | 4.0% |
Sector Breakdown1
Health Care | 17.8% | |||||
Consumer Discretionary | 16.4% | |||||
Information Technology | 16.0% | |||||
Financials | 15.5% | |||||
Telecommunication Services | 9.5% | |||||
Industrials | 7.9% | |||||
Materials | 5.5% | |||||
Utilities | 5.0% | |||||
Energy | 4.0% |
1 % of Investments, at value as of 12/31/2015. Top 10 Holdings and Sector Breakdown solely reflect long positions. Securities sold short, financial derivative instruments and short-term instruments are not taken into consideration.
Fund Insights
» | During the reporting period, the Fund paid ordinary quarterly dividends totaling 15 cents per share on its Institutional class shares. The dividend per share was slightly lower for the other share classes to account for varying class-specific expenses. |
» | Stock selection within the oil, gas & consumable fuels industry detracted from relative returns, as two stocks out of the index significantly underperformed the S&P 500 Index during the reporting period. |
» | From a market capitalization perspective, the Fund’s exposure to small-cap stocks detracted from the Fund’s performance as small-cap stocks underperformed large-cap stocks over the reporting period. |
» | Over the reporting period, the top three equity contributors were PG&E Corporation, SeaWorld Entertainment and Apple Inc. The top three equity detractors were Targa Resources, Tronox Ltd. and Golar LNG Partners LP. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 17 |
Table of Contents
Example
As a shareholder of a Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and exchange fees and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. The Example is intended to help you understand your ongoing costs (in dollars) of investing in a Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period indicated, which for all Funds and share classes is from July 1, 2015 to December 31, 2015 unless noted otherwise in the table and footnotes below.
Actual Expenses
The information in the table under the heading “Actual” provides information about actual account values and actual expenses. You may use the information in these columns, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = $8.60), then multiply the result by the number in the appropriate column for your share class, in the column entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The information in the table under the heading “Hypothetical (5% return before expenses)” provides information about hypothetical account values and hypothetical expenses based on a Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in a Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) on purchase payments and exchange fees. Therefore, the information under the heading “Hypothetical (5% return before expenses)” is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Expense ratios may vary from period to period because of various factors such as an increase in expenses that are not covered by the management fees, such as fees and expenses of the independent trustees and their counsel, extraordinary expenses and interest expense.
Actual | Hypothetical (5% return before expenses) | |||||||||||||||||||||||||||||||||
Beginning Account Value (07/01/15) | Ending Account Value (12/31/15) | Expenses Paid During Period* | Beginning Account Value (07/01/15) | Ending Account Value (12/31/15) | Expenses Paid During Period* | Net Annualized Expense Ratio** | ||||||||||||||||||||||||||||
PIMCO Balanced Income Fund | ||||||||||||||||||||||||||||||||||
Institutional Class | $ | 1,000.00 | $ | 922.90 | $ | 3.73 | $ | 1,000.00 | $ | 1,021.66 | $ | 3.93 | 0.76 | % | ||||||||||||||||||||
Class P | 1,000.00 | 922.40 | 4.22 | 1,000.00 | 1,021.15 | 4.44 | 0.86 | |||||||||||||||||||||||||||
Class D | 1,000.00 | 921.20 | 5.45 | 1,000.00 | 1,019.88 | 5.73 | 1.11 | |||||||||||||||||||||||||||
Class A | 1,000.00 | 921.20 | 5.45 | 1,000.00 | 1,019.88 | 5.73 | 1.11 | |||||||||||||||||||||||||||
Class C | 1,000.00 | 917.40 | 9.11 | 1,000.00 | 1,016.04 | 9.58 | 1.86 | |||||||||||||||||||||||||||
PIMCO Dividend and Income Builder Fund | ||||||||||||||||||||||||||||||||||
Institutional Class | $ | 1,000.00 | $ | 887.00 | $ | 4.00 | $ | 1,000.00 | $ | 1,021.31 | $ | 4.29 | 0.83 | % | ||||||||||||||||||||
Class P | 1,000.00 | 885.80 | 4.48 | 1,000.00 | 1,020.79 | 4.80 | 0.93 | |||||||||||||||||||||||||||
Class D | 1,000.00 | 884.40 | 5.68 | 1,000.00 | 1,019.52 | 6.09 | 1.18 | |||||||||||||||||||||||||||
Class A | 1,000.00 | 885.30 | 5.68 | 1,000.00 | 1,019.52 | 6.09 | 1.18 | |||||||||||||||||||||||||||
Class C | 1,000.00 | 881.50 | 9.28 | 1,000.00 | 1,015.69 | 9.94 | 1.93 | |||||||||||||||||||||||||||
Class R | 1,000.00 | 884.10 | 6.88 | 1,000.00 | 1,018.24 | 7.37 | 1.43 |
18 | PIMCO EQUITY SERIES |
Table of Contents
Actual | Hypothetical (5% return before expenses) | |||||||||||||||||||||||||||||||||
Beginning Account Value (07/01/15) | Ending Account Value (12/31/15) | Expenses Paid During Period* | Beginning Account Value (07/01/15) | Ending Account Value (12/31/15) | Expenses Paid During Period* | Net Annualized Expense Ratio** | ||||||||||||||||||||||||||||
PIMCO EqS® Long/Short Fund | ||||||||||||||||||||||||||||||||||
Institutional Class | $ | 1,000.00 | $ | 977.30 | $ | 13.08 | $ | 1,000.00 | $ | 1,012.31 | $ | 13.31 | 2.59 | % | ||||||||||||||||||||
Class P | 1,000.00 | 977.20 | 13.64 | 1,000.00 | 1,011.75 | 13.88 | 2.70 | |||||||||||||||||||||||||||
Class D | 1,000.00 | 975.40 | 14.89 | 1,000.00 | 1,010.47 | 15.15 | 2.95 | |||||||||||||||||||||||||||
Class A | 1,000.00 | 975.40 | 14.84 | 1,000.00 | 1,010.53 | 15.10 | 2.94 | |||||||||||||||||||||||||||
Class C | 1,000.00 | 971.40 | 18.58 | 1,000.00 | 1,006.69 | 18.92 | 3.69 | |||||||||||||||||||||||||||
PIMCO Global Dividend Fund | ||||||||||||||||||||||||||||||||||
Institutional Class | $ | 1,000.00 | $ | 871.40 | $ | 4.02 | $ | 1,000.00 | $ | 1,021.25 | $ | 4.34 | 0.84 | % | ||||||||||||||||||||
Class P | 1,000.00 | 871.30 | 4.49 | 1,000.00 | 1,020.74 | 4.85 | 0.94 | |||||||||||||||||||||||||||
Class D | 1,000.00 | 870.10 | 5.69 | 1,000.00 | 1,019.47 | 6.14 | 1.19 | |||||||||||||||||||||||||||
Class A | 1,000.00 | 870.10 | 5.69 | 1,000.00 | 1,019.47 | 6.14 | 1.19 | |||||||||||||||||||||||||||
Class C | 1,000.00 | 865.50 | 9.25 | 1,000.00 | 1,015.63 | 9.99 | 1.94 | |||||||||||||||||||||||||||
Class R | 1,000.00 | 868.50 | 6.87 | 1,000.00 | 1,018.19 | 7.42 | 1.44 | |||||||||||||||||||||||||||
PIMCO International Dividend Fund | ||||||||||||||||||||||||||||||||||
Institutional Class | $ | 1,000.00 | $ | 871.20 | $ | 4.02 | $ | 1,000.00 | $ | 1,021.25 | $ | 4.34 | 0.84 | % | ||||||||||||||||||||
Class P | 1,000.00 | 870.70 | 4.49 | 1,000.00 | 1,020.74 | 4.85 | 0.94 | |||||||||||||||||||||||||||
Class D | 1,000.00 | 869.60 | 5.68 | 1,000.00 | 1,019.47 | 6.14 | 1.19 | |||||||||||||||||||||||||||
Class A | 1,000.00 | 869.70 | 5.68 | 1,000.00 | 1,019.47 | 6.14 | 1.19 | |||||||||||||||||||||||||||
Class C | 1,000.00 | 866.00 | 9.25 | 1,000.00 | 1,015.63 | 9.99 | 1.94 | |||||||||||||||||||||||||||
PIMCO U.S. Dividend Fund | ||||||||||||||||||||||||||||||||||
Institutional Class | $ | 1,000.00 | $ | 870.20 | $ | 3.58 | $ | 1,000.00 | $ | 1,021.71 | $ | 3.87 | 0.75 | % | ||||||||||||||||||||
Class P | 1,000.00 | 870.60 | 4.06 | 1,000.00 | 1,021.20 | 4.39 | 0.85 | |||||||||||||||||||||||||||
Class D | 1,000.00 | 869.40 | 5.25 | 1,000.00 | 1,019.93 | 5.68 | 1.10 | |||||||||||||||||||||||||||
Class A | 1,000.00 | 868.70 | 5.25 | 1,000.00 | 1,019.93 | 5.68 | 1.10 | |||||||||||||||||||||||||||
Class C | 1,000.00 | 866.00 | 8.82 | 1,000.00 | 1,016.09 | 9.53 | 1.85 |
* Expenses Paid During Period are equal to the net annualized expense ratio for the class, multiplied by the average account value over the period, multiplied by 187/366 (to reflect the one-half year period).
** Net Annualized Expense Ratio is reflective of any applicable contractual fee waivers and/or expense reimbursements or voluntary fee waivers. Details regarding fee waivers can be found in Note 8 in the Notes to Financial Statements.
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 19 |
Table of Contents
Selected Per Share Data for the Year or Period Ended: | Net Asset Value Beginning of Year or Period | Net Investment Income (Loss) (a) | Net Realized/ Unrealized Gain (Loss) | Total from Investment Operations | Dividends | Distributions from Net Realized Capital Gains (b) | Total Distributions | |||||||||||||||||||||
PIMCO Balanced Income Fund | ||||||||||||||||||||||||||||
Institutional Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 10.05 | $ | 0.15 | $ | (0.92 | ) | $ | (0.77 | ) | $ | (0.24 | ) | $ | (0.11 | ) | $ | (0.35 | ) | |||||||||
06/30/2015 | 10.24 | 0.30 | (0.17 | ) | 0.13 | (0.31 | ) | (0.01 | ) | (0.32 | ) | |||||||||||||||||
03/31/2014 - 06/30/2014 | 10.00 | 0.08 | 0.24 | 0.32 | (0.08 | ) | 0.00 | (0.08 | ) | |||||||||||||||||||
Class P | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.05 | 0.15 | (0.93 | ) | (0.78 | ) | (0.23 | ) | (0.11 | ) | (0.34 | ) | ||||||||||||||||
06/30/2015 | 10.24 | 0.30 | (0.18 | ) | 0.12 | (0.30 | ) | (0.01 | ) | (0.31 | ) | |||||||||||||||||
03/31/2014 - 06/30/2014 | 10.00 | 0.08 | 0.24 | 0.32 | (0.08 | ) | 0.00 | (0.08 | ) | |||||||||||||||||||
Class D | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.05 | 0.14 | (0.93 | ) | (0.79 | ) | (0.22 | ) | (0.11 | ) | (0.33 | ) | ||||||||||||||||
06/30/2015 | 10.25 | 0.27 | (0.18 | ) | 0.09 | (0.28 | ) | (0.01 | ) | (0.29 | ) | |||||||||||||||||
03/31/2014 - 06/30/2014 | 10.00 | 0.08 | 0.24 | 0.32 | (0.07 | ) | 0.00 | (0.07 | ) | |||||||||||||||||||
Class A | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.05 | 0.14 | (0.93 | ) | (0.79 | ) | (0.22 | ) | (0.11 | ) | (0.33 | ) | ||||||||||||||||
06/30/2015 | 10.25 | 0.29 | (0.20 | ) | 0.09 | (0.28 | ) | (0.01 | ) | (0.29 | ) | |||||||||||||||||
03/31/2014 - 06/30/2014 | 10.00 | 0.08 | 0.24 | 0.32 | (0.07 | ) | 0.00 | (0.07 | ) | |||||||||||||||||||
Class C | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.05 | 0.10 | (0.93 | ) | (0.83 | ) | (0.18 | ) | (0.11 | ) | (0.29 | ) | ||||||||||||||||
06/30/2015 | 10.25 | 0.19 | (0.18 | ) | 0.01 | (0.20 | ) | (0.01 | ) | (0.21 | ) | |||||||||||||||||
03/31/2014 - 06/30/2014 | 10.00 | 0.07 | 0.23 | 0.30 | (0.05 | ) | 0.00 | (0.05 | ) | |||||||||||||||||||
PIMCO Dividend and Income Builder Fund | ||||||||||||||||||||||||||||
Institutional Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 12.29 | $ | 0.19 | $ | (1.59 | ) | $ | (1.40 | ) | $ | (0.20 | ) | $ | (0.76 | ) | $ | (0.96 | ) | |||||||||
06/30/2015 | 13.12 | 0.47 | (0.50 | ) | (0.03 | ) | (0.46 | ) | (0.34 | ) | (0.80 | ) | ||||||||||||||||
06/30/2014 | 11.60 | 0.44 | 1.54 | 1.98 | (0.46 | ) | 0.00 | (0.46 | ) | |||||||||||||||||||
06/30/2013 | 10.47 | 0.54 | 1.03 | 1.57 | (0.42 | ) | (0.02 | ) | (0.44 | ) | ||||||||||||||||||
12/14/2011 - 06/30/2012 | 10.00 | 0.25 | 0.47 | 0.72 | (0.25 | ) | 0.00 | (0.25 | ) | |||||||||||||||||||
Class P | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 12.30 | 0.18 | (1.59 | ) | (1.41 | ) | (0.20 | ) | (0.76 | ) | (0.96 | ) | ||||||||||||||||
06/30/2015 | 13.13 | 0.46 | (0.50 | ) | (0.04 | ) | (0.45 | ) | (0.34 | ) | (0.79 | ) | ||||||||||||||||
06/30/2014 | 11.62 | 0.44 | 1.52 | 1.96 | (0.45 | ) | 0.00 | (0.45 | ) | |||||||||||||||||||
06/30/2013 | 10.48 | 0.54 | 1.03 | 1.57 | (0.41 | ) | (0.02 | ) | (0.43 | ) | ||||||||||||||||||
12/14/2011 - 06/30/2012 | 10.00 | 0.30 | 0.42 | 0.72 | (0.24 | ) | 0.00 | (0.24 | ) | |||||||||||||||||||
Class D | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 12.29 | 0.17 | (1.60 | ) | (1.43 | ) | (0.18 | ) | (0.76 | ) | (0.94 | ) | ||||||||||||||||
06/30/2015 | 13.12 | 0.46 | (0.53 | ) | (0.07 | ) | (0.42 | ) | (0.34 | ) | (0.76 | ) | ||||||||||||||||
06/30/2014 | 11.61 | 0.40 | 1.53 | 1.93 | (0.42 | ) | 0.00 | (0.42 | ) | |||||||||||||||||||
06/30/2013 | 10.47 | 0.46 | 1.09 | 1.55 | (0.39 | ) | (0.02 | ) | (0.41 | ) | ||||||||||||||||||
12/14/2011 - 06/30/2012 | 10.00 | 0.26 | 0.44 | 0.70 | (0.23 | ) | 0.00 | (0.23 | ) | |||||||||||||||||||
Class A | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 12.29 | 0.17 | (1.59 | ) | (1.42 | ) | (0.18 | ) | (0.76 | ) | (0.94 | ) | ||||||||||||||||
06/30/2015 | 13.12 | 0.43 | (0.50 | ) | (0.07 | ) | (0.42 | ) | (0.34 | ) | (0.76 | ) | ||||||||||||||||
06/30/2014 | 11.61 | 0.42 | 1.51 | 1.93 | (0.42 | ) | 0.00 | (0.42 | ) | |||||||||||||||||||
06/30/2013 | 10.47 | 0.48 | 1.07 | 1.55 | (0.39 | ) | (0.02 | ) | (0.41 | ) | ||||||||||||||||||
12/14/2011 - 06/30/2012 | 10.00 | 0.26 | 0.44 | 0.70 | (0.23 | ) | 0.00 | (0.23 | ) | |||||||||||||||||||
Class C | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 12.27 | 0.13 | (1.59 | ) | (1.46 | ) | (0.14 | ) | (0.76 | ) | (0.90 | ) | ||||||||||||||||
06/30/2015 | 13.10 | 0.34 | (0.51 | ) | (0.17 | ) | (0.32 | ) | (0.34 | ) | (0.66 | ) | ||||||||||||||||
06/30/2014 | 11.59 | 0.33 | 1.51 | 1.84 | (0.33 | ) | 0.00 | (0.33 | ) | |||||||||||||||||||
06/30/2013 | 10.46 | 0.40 | 1.06 | 1.46 | (0.31 | ) | (0.02 | ) | (0.33 | ) | ||||||||||||||||||
12/14/2011 - 06/30/2012 | 10.00 | 0.24 | 0.41 | 0.65 | (0.19 | ) | 0.00 | (0.19 | ) | |||||||||||||||||||
Class R | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 12.29 | 0.15 | (1.58 | ) | (1.43 | ) | (0.17 | ) | (0.76 | ) | (0.93 | ) | ||||||||||||||||
06/30/2015 | 13.12 | 0.38 | (0.48 | ) | (0.10 | ) | (0.39 | ) | (0.34 | ) | (0.73 | ) | ||||||||||||||||
06/30/2014 | 11.61 | 0.38 | 1.52 | 1.90 | (0.39 | ) | 0.00 | (0.39 | ) | |||||||||||||||||||
06/30/2013 | 10.47 | 0.36 | 1.16 | 1.52 | (0.36 | ) | (0.02 | ) | (0.38 | ) | ||||||||||||||||||
12/14/2011 - 06/30/2012 | 10.00 | 0.25 | 0.43 | 0.68 | (0.21 | ) | 0.00 | (0.21 | ) |
Please see footnotes on page 24.
20 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
Net Asset Value End of Year or Period | Total Return | Net Assets End of Year or Period (000s) | Ratio of Expenses to Average Net Assets | Ratio of Expenses to Average Net Assets Excluding Waivers | Ratio of Expenses to Average Net Assets Excluding Interest Expense and Dividends on Securities Sold Short | Ratio of Expenses to Average Net Assets Excluding Interest Expense and Dividends on Securities Sold Short and Waivers | Ratio of Net Investment Income (Loss) to Average Net Assets | Portfolio Turnover Rate | ||||||||||||||||||||||||||
$ | 8.93 | (7.71 | )% | $ | 6,350 | 0.76 | %* | 0.92 | %* | 0.76 | %* | 0.92 | %* | 3.18 | %* | 31 | % | |||||||||||||||||
10.05 | 1.34 | 7,473 | 0.75 | 0.91 | 0.75 | 0.91 | 2.92 | 65 | ||||||||||||||||||||||||||
10.24 | 3.20 | 6,284 | 0.75 | * | 4.52 | * | 0.75 | * | 4.52 | * | 3.20 | * | 6 | |||||||||||||||||||||
8.93 | (7.76 | ) | 119 | 0.86 | * | 1.02 | * | 0.86 | * | 1.02 | * | 3.08 | * | 31 | ||||||||||||||||||||
10.05 | 1.24 | 141 | 0.85 | 1.01 | 0.85 | 1.01 | 2.96 | 65 | ||||||||||||||||||||||||||
10.24 | 3.18 | 11 | 0.85 | * | 4.62 | * | 0.85 | * | 4.62 | * | 3.03 | * | 6 | |||||||||||||||||||||
8.93 | (7.88 | ) | 490 | 1.11 | * | 1.27 | * | 1.11 | * | 1.27 | * | 2.88 | * | 31 | ||||||||||||||||||||
10.05 | 0.89 | 397 | 1.10 | 1.26 | 1.10 | 1.26 | 2.66 | 65 | ||||||||||||||||||||||||||
10.25 | 3.21 | 45 | 1.10 | * | 4.87 | * | 1.10 | * | 4.87 | * | 3.11 | * | 6 | |||||||||||||||||||||
8.93 | (7.88 | ) | 4,748 | 1.11 | * | 1.27 | * | 1.11 | * | 1.27 | * | 2.86 | * | 31 | ||||||||||||||||||||
10.05 | 0.88 | 4,380 | 1.10 | 1.26 | 1.10 | 1.26 | 2.81 | 65 | ||||||||||||||||||||||||||
10.25 | 3.21 | 319 | 1.10 | * | 4.87 | * | 1.10 | * | 4.87 | * | 3.14 | * | 6 | |||||||||||||||||||||
8.93 | (8.26 | ) | 4,737 | 1.86 | * | 2.02 | * | 1.86 | * | 2.02 | * | 2.13 | * | 31 | ||||||||||||||||||||
10.05 | 0.13 | 3,788 | 1.85 | 2.01 | 1.85 | 2.01 | 1.91 | 65 | ||||||||||||||||||||||||||
10.25 | 3.03 | 461 | 1.85 | * | 5.62 | * | 1.85 | * | 5.62 | * | 2.87 | * | 6 | |||||||||||||||||||||
$ | 9.93 | (11.30 | )% | $ | 33,358 | 0.83 | %* | 1.00 | %* | 0.83 | %* | 1.00 | %* | 3.24 | %* | 35 | % | |||||||||||||||||
12.29 | (0.12 | ) | 68,607 | 0.83 | 1.00 | 0.83 | 1.00 | 3.70 | 98 | |||||||||||||||||||||||||
13.12 | 17.23 | 90,408 | 0.84 | 1.00 | 0.84 | 1.00 | 3.56 | 79 | ||||||||||||||||||||||||||
11.60 | 15.17 | 69,203 | 0.83 | 1.00 | 0.83 | 1.00 | 4.66 | 75 | ||||||||||||||||||||||||||
10.47 | 7.17 | 11,170 | 0.83 | * | 1.57 | * | 0.83 | * | 1.57 | * | 4.35 | * | 28 | |||||||||||||||||||||
9.93 | (11.42 | ) | 63,295 | 0.93 | * | 1.10 | * | 0.93 | * | 1.10 | * | 3.13 | * | 35 | ||||||||||||||||||||
12.30 | (0.22 | ) | 169,790 | 0.93 | 1.10 | 0.93 | 1.10 | 3.64 | 98 | |||||||||||||||||||||||||
13.13 | 17.05 | 158,122 | 0.94 | 1.10 | 0.94 | 1.10 | 3.53 | 79 | ||||||||||||||||||||||||||
11.62 | 15.15 | 85,724 | 0.93 | 1.10 | 0.93 | 1.10 | 4.62 | 75 | ||||||||||||||||||||||||||
10.48 | 7.21 | 8,207 | 0.93 | * | 2.47 | * | 0.93 | * | 2.47 | * | 5.28 | * | 28 | |||||||||||||||||||||
9.92 | (11.56 | ) | 25,106 | 1.18 | * | 1.35 | * | 1.18 | * | 1.35 | * | 2.88 | * | 35 | ||||||||||||||||||||
12.29 | (0.47 | ) | 41,094 | 1.18 | 1.35 | 1.18 | 1.35 | 3.59 | 98 | |||||||||||||||||||||||||
13.12 | 16.78 | 32,523 | 1.19 | 1.35 | 1.19 | 1.35 | 3.19 | 79 | ||||||||||||||||||||||||||
11.61 | 14.91 | 23,204 | 1.18 | 1.35 | 1.18 | 1.35 | 4.00 | 75 | ||||||||||||||||||||||||||
10.47 | 6.98 | 2,306 | 1.18 | * | 2.26 | * | 1.18 | * | 2.26 | * | 4.52 | * | 28 | |||||||||||||||||||||
9.93 | (11.47 | ) | 223,538 | 1.18 | * | 1.35 | * | 1.18 | * | 1.35 | * | 2.92 | * | 35 | ||||||||||||||||||||
12.29 | (0.49 | ) | 296,317 | 1.18 | 1.35 | 1.18 | 1.35 | 3.39 | 98 | |||||||||||||||||||||||||
13.12 | 16.78 | 320,719 | 1.19 | 1.35 | 1.19 | 1.35 | 3.34 | 79 | ||||||||||||||||||||||||||
11.61 | 14.91 | 117,579 | 1.18 | 1.35 | 1.18 | 1.35 | 4.18 | 75 | ||||||||||||||||||||||||||
10.47 | 6.98 | 13,314 | 1.18 | * | 2.43 | * | 1.18 | * | 2.43 | * | 4.62 | * | 28 | |||||||||||||||||||||
9.91 | (11.85 | ) | 258,030 | 1.93 | * | 2.10 | * | 1.93 | * | 2.10 | * | 2.17 | * | 35 | ||||||||||||||||||||
12.27 | (1.23 | ) | 358,171 | 1.93 | 2.10 | 1.93 | 2.10 | 2.67 | 98 | |||||||||||||||||||||||||
13.10 | 15.97 | 353,287 | 1.94 | 2.10 | 1.94 | 2.10 | 2.67 | 79 | ||||||||||||||||||||||||||
11.59 | 14.08 | 86,879 | 1.93 | 2.10 | 1.93 | 2.10 | 3.42 | 75 | ||||||||||||||||||||||||||
10.46 | 6.46 | 8,000 | 1.93 | * | 3.46 | * | 1.93 | * | 3.46 | * | 4.27 | * | 28 | |||||||||||||||||||||
9.93 | (11.59 | ) | 251 | 1.43 | * | 1.60 | * | 1.43 | * | 1.60 | * | 2.66 | * | 35 | ||||||||||||||||||||
12.29 | (0.72 | ) | 283 | 1.43 | 1.60 | 1.43 | 1.60 | 2.97 | 98 | |||||||||||||||||||||||||
13.12 | 16.50 | 459 | 1.44 | 1.60 | 1.44 | 1.60 | 3.03 | 79 | ||||||||||||||||||||||||||
11.61 | 14.66 | 217 | 1.43 | 1.60 | 1.43 | 1.60 | 3.24 | 75 | ||||||||||||||||||||||||||
10.47 | 6.84 | 415 | 1.43 | * | 2.32 | * | 1.43 | * | 2.32 | * | 4.30 | * | 28 |
Please see footnotes on page 24.
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 21 |
Table of Contents
Financial Highlights (Cont.)
Selected Per Share Data for the Year or Period Ended: | Net Asset Value Beginning of Year or Period | Net Investment Income (Loss) (a) | Net Realized/ Unrealized Gain (Loss) | Total from Investment Operations | Dividends | Distributions from Net Realized Capital Gains (b) | Total Distributions | |||||||||||||||||||||
PIMCO EqS® Long/Short Fund | ||||||||||||||||||||||||||||
Institutional Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 12.07 | $ | (0.08 | ) | $ | (0.19 | ) | $ | (0.27 | ) | $ | 0.00 | $ | (0.14 | ) | $ | (0.14 | ) | |||||||||
06/30/2015 | 11.92 | 0.02 | 0.18 | 0.20 | 0.00 | (0.05 | ) | (0.05 | ) | |||||||||||||||||||
06/30/2014 | 11.09 | (0.10 | ) | 1.60 | 1.50 | (0.06 | ) | (0.61 | ) | (0.67 | ) | |||||||||||||||||
06/30/2013 | 9.71 | 0.15 | 1.27 | 1.42 | (0.04 | ) | 0.00 | (0.04 | ) | |||||||||||||||||||
04/20/2012 - 06/30/2012 | 10.00 | (0.02 | ) | (0.27 | ) | (0.29 | ) | 0.00 | 0.00 | 0.00 | ||||||||||||||||||
Class P | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 12.02 | (0.08 | ) | (0.19 | ) | (0.27 | ) | 0.00 | (0.14 | ) | (0.14 | ) | ||||||||||||||||
06/30/2015 | 11.88 | 0.02 | 0.17 | 0.19 | 0.00 | (0.05 | ) | (0.05 | ) | |||||||||||||||||||
06/30/2014 | 11.08 | (0.08 | ) | 1.56 | 1.48 | (0.07 | ) | (0.61 | ) | (0.68 | ) | |||||||||||||||||
06/30/2013 | 9.70 | (0.05 | ) | 1.47 | 1.42 | (0.04 | ) | 0.00 | (0.04 | ) | ||||||||||||||||||
04/30/2012 - 06/30/2012 | 10.00 | (0.02 | ) | (0.28 | ) | (0.30 | ) | 0.00 | 0.00 | 0.00 | ||||||||||||||||||
Class D | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 11.95 | (0.10 | ) | (0.19 | ) | (0.29 | ) | 0.00 | (0.14 | ) | (0.14 | ) | ||||||||||||||||
06/30/2015 | 11.84 | (0.02 | ) | 0.18 | 0.16 | 0.00 | (0.05 | ) | (0.05 | ) | ||||||||||||||||||
06/30/2014 | 11.06 | (0.12 | ) | 1.57 | 1.45 | (0.06 | ) | (0.61 | ) | (0.67 | ) | |||||||||||||||||
06/30/2013 | 9.70 | (0.10 | ) | 1.48 | 1.38 | (0.02 | ) | 0.00 | (0.02 | ) | ||||||||||||||||||
04/30/2012 - 06/30/2012 | 10.00 | (0.03 | ) | (0.27 | ) | (0.30 | ) | 0.00 | 0.00 | 0.00 | ||||||||||||||||||
Class A | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 11.94 | (0.10 | ) | (0.19 | ) | (0.29 | ) | 0.00 | (0.14 | ) | (0.14 | ) | ||||||||||||||||
06/30/2015 | 11.83 | (0.02 | ) | 0.18 | 0.16 | 0.00 | (0.05 | ) | (0.05 | ) | ||||||||||||||||||
06/30/2014 | 11.05 | (0.12 | ) | 1.57 | 1.45 | (0.06 | ) | (0.61 | ) | (0.67 | ) | |||||||||||||||||
06/30/2013 | 9.70 | (0.00 | )^ | 1.38 | 1.38 | (0.03 | ) | 0.00 | (0.03 | ) | ||||||||||||||||||
04/30/2012 - 06/30/2012 | 10.00 | (0.03 | ) | (0.27 | ) | (0.30 | ) | 0.00 | 0.00 | 0.00 | ||||||||||||||||||
Class C | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 11.69 | (0.14 | ) | (0.19 | ) | (0.33 | ) | 0.00 | (0.14 | ) | (0.14 | ) | ||||||||||||||||
06/30/2015 | 11.67 | (0.11 | ) | 0.18 | 0.07 | 0.00 | (0.05 | ) | (0.05 | ) | ||||||||||||||||||
06/30/2014 | 10.98 | (0.20 | ) | 1.55 | 1.35 | (0.05 | ) | (0.61 | ) | (0.66 | ) | |||||||||||||||||
06/30/2013 | 9.69 | 0.01 | 1.29 | 1.30 | (0.01 | ) | 0.00 | (0.01 | ) | |||||||||||||||||||
04/30/2012 - 06/30/2012 | 10.00 | (0.04 | ) | (0.27 | ) | (0.31 | ) | 0.00 | 0.00 | 0.00 | ||||||||||||||||||
PIMCO Global Dividend Fund | ||||||||||||||||||||||||||||
Institutional Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 7.34 | $ | 0.09 | $ | (1.04 | ) | $ | (0.95 | ) | $ | (0.10 | ) | $ | (0.80 | ) | $ | (0.90 | ) | |||||||||
06/30/2015 | 12.81 | 0.30 | (0.48 | ) | (0.18 | ) | (0.26 | ) | (5.03 | ) | (5.29 | ) | ||||||||||||||||
06/30/2014 | 11.87 | 0.39 | 1.65 | 2.04 | (0.48 | ) | (0.62 | ) | (1.10 | ) | ||||||||||||||||||
06/30/2013 | 10.47 | 0.43 | 1.37 | 1.80 | (0.37 | ) | (0.03 | ) | (0.40 | ) | ||||||||||||||||||
12/14/2011 - 06/30/2012 | 10.00 | 0.28 | 0.42 | 0.70 | (0.23 | ) | 0.00 | (0.23 | ) | |||||||||||||||||||
Class P | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 7.35 | 0.09 | (1.04 | ) | (0.95 | ) | (0.10 | ) | (0.80 | ) | (0.90 | ) | ||||||||||||||||
06/30/2015 | 12.82 | 0.26 | (0.45 | ) | (0.19 | ) | (0.25 | ) | (5.03 | ) | (5.28 | ) | ||||||||||||||||
06/30/2014 | 11.88 | 0.42 | 1.61 | 2.03 | (0.47 | ) | (0.62 | ) | (1.09 | ) | ||||||||||||||||||
06/30/2013 | 10.48 | 0.47 | 1.32 | 1.79 | (0.36 | ) | (0.03 | ) | (0.39 | ) | ||||||||||||||||||
12/14/2011 - 06/30/2012 | 10.00 | 0.29 | 0.41 | 0.70 | (0.22 | ) | 0.00 | (0.22 | ) | |||||||||||||||||||
Class D | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 7.35 | 0.08 | (1.04 | ) | (0.96 | ) | (0.09 | ) | (0.80 | ) | (0.89 | ) | ||||||||||||||||
06/30/2015 | 12.81 | 0.25 | (0.46 | ) | (0.21 | ) | (0.22 | ) | (5.03 | ) | (5.25 | ) | ||||||||||||||||
06/30/2014 | 11.87 | 0.39 | 1.61 | 2.00 | (0.44 | ) | (0.62 | ) | (1.06 | ) | ||||||||||||||||||
06/30/2013 | 10.48 | 0.40 | 1.36 | 1.76 | (0.34 | ) | (0.03 | ) | (0.37 | ) | ||||||||||||||||||
12/14/2011 - 06/30/2012 | 10.00 | 0.30 | 0.39 | 0.69 | (0.21 | ) | 0.00 | (0.21 | ) | |||||||||||||||||||
Class A | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 7.35 | 0.08 | (1.04 | ) | (0.96 | ) | (0.09 | ) | (0.80 | ) | (0.89 | ) | ||||||||||||||||
06/30/2015 | 12.82 | 0.25 | (0.47 | ) | (0.22 | ) | (0.22 | ) | (5.03 | ) | (5.25 | ) | ||||||||||||||||
06/30/2014 | 11.88 | 0.39 | 1.61 | 2.00 | (0.44 | ) | (0.62 | ) | (1.06 | ) | ||||||||||||||||||
06/30/2013 | 10.48 | 0.42 | 1.35 | 1.77 | (0.34 | ) | (0.03 | ) | (0.37 | ) | ||||||||||||||||||
12/14/2011 - 06/30/2012 | 10.00 | 0.27 | 0.42 | 0.69 | (0.21 | ) | 0.00 | (0.21 | ) |
Please see footnotes on page 24.
22 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
Net Asset Value End of Year or Period | Total Return | Net Assets End of Year or Period (000s) | Ratio of Expenses to Average Net Assets | Ratio of Expenses to Average Net Assets Excluding Waivers | Ratio of Expenses to Average Net Assets Excluding Interest Expense and Dividends on Securities Sold Short | Ratio of Expenses to Average Net Assets Excluding Interest Expense and Dividends on Securities Sold Short and Waivers | Ratio of Net Investment Income (Loss) to Average Net Assets | Portfolio Turnover Rate | ||||||||||||||||||||||||||
$ | 11.66 | (2.27 | )% | $ | 223,239 | 2.59 | %* | 2.60 | %* | 1.50 | %* | 1.51 | %* | (1.30 | )%* | 340 | % | |||||||||||||||||
12.07 | 1.74 | 299,808 | 1.91 | 1.92 | 1.49 | 1.50 | 0.20 | 450 | (c) | |||||||||||||||||||||||||
11.92 | 13.59 | 545,346 | 2.02 | 2.04 | 1.48 | 1.50 | (0.82 | ) | 522 | |||||||||||||||||||||||||
11.09 | 14.66 | 329,610 | 2.65 | 2.75 | 1.40 | 1.50 | 1.45 | 528 | ||||||||||||||||||||||||||
9.71 | (2.90 | ) | 212,229 | 1.52 | * | 2.41 | * | 1.40 | * | 2.29 | * | (1.30 | )* | 113 | ||||||||||||||||||||
11.61 | (2.28 | ) | 275,064 | 2.69 | * | 2.70 | * | 1.60 | * | 1.61 | * | (1.27 | )* | 340 | ||||||||||||||||||||
12.02 | 1.66 | 207,511 | 2.01 | 2.02 | 1.59 | 1.60 | 0.16 | 450 | (c) | |||||||||||||||||||||||||
11.88 | 13.40 | 277,661 | 2.00 | 2.02 | 1.58 | 1.60 | (0.71 | ) | 522 | |||||||||||||||||||||||||
11.08 | 14.77 | 15,664 | 3.94 | 4.04 | 1.50 | 1.60 | (0.48 | ) | 528 | |||||||||||||||||||||||||
9.70 | (3.00 | ) | 10 | 1.62 | * | 2.40 | * | 1.50 | * | 2.28 | * | (1.34 | )* | 113 | ||||||||||||||||||||
11.52 | (2.46 | ) | 55,781 | 2.94 | * | 2.95 | * | 1.85 | * | 1.86 | * | (1.52 | )* | 340 | ||||||||||||||||||||
11.95 | 1.41 | 44,227 | 2.26 | 2.27 | 1.84 | 1.85 | (0.19 | ) | 450 | (c) | ||||||||||||||||||||||||
11.84 | 13.13 | 77,934 | 2.31 | 2.33 | 1.83 | 1.85 | (1.01 | ) | 522 | |||||||||||||||||||||||||
11.06 | 14.31 | 12,421 | 3.95 | 4.05 | 1.75 | 1.85 | (0.97 | ) | 528 | |||||||||||||||||||||||||
9.70 | (3.00 | ) | 111 | 1.87 | * | 3.97 | * | 1.77 | * | 3.87 | * | (1.72 | )* | 113 | ||||||||||||||||||||
11.51 | (2.46 | ) | 154,923 | 2.94 | * | 2.95 | * | 1.85 | * | 1.86 | * | (1.61 | )* | 340 | ||||||||||||||||||||
11.94 | 1.41 | 172,843 | 2.26 | 2.27 | 1.84 | 1.85 | (0.18 | ) | 450 | (c) | ||||||||||||||||||||||||
11.83 | 13.17 | 382,160 | 2.27 | 2.29 | 1.83 | 1.85 | (0.98 | ) | 522 | |||||||||||||||||||||||||
11.05 | 14.27 | 24,759 | 3.62 | 3.72 | 1.75 | 1.85 | (0.03 | ) | 528 | |||||||||||||||||||||||||
9.70 | (3.00 | ) | 1,219 | 1.87 | * | 3.17 | * | 1.74 | * | 3.04 | * | (1.70 | )* | 113 | ||||||||||||||||||||
11.22 | (2.86 | ) | 152,216 | 3.69 | * | 3.70 | * | 2.60 | * | 2.61 | * | (2.31 | )* | 340 | ||||||||||||||||||||
11.69 | 0.66 | 140,719 | 3.01 | 3.02 | 2.59 | 2.60 | (0.95 | ) | 450 | (c) | ||||||||||||||||||||||||
11.67 | 12.26 | 214,485 | 3.00 | 3.02 | 2.58 | 2.60 | (1.71 | ) | 522 | |||||||||||||||||||||||||
10.98 | 13.41 | 9,530 | 4.04 | 4.14 | 2.50 | 2.60 | 0.13 | 528 | ||||||||||||||||||||||||||
9.69 | (3.10 | ) | 53 | 2.62 | * | 4.50 | * | 2.52 | * | 4.40 | * | (2.46 | )* | 113 | ||||||||||||||||||||
$ | 5.49 | (12.86 | )% | $ | 50,160 | 0.84 | %* | 1.01 | %* | 0.84 | %* | 1.01 | %* | 2.64 | %* | 45 | % | |||||||||||||||||
7.34 | (0.43 | ) | 58,212 | 0.84 | 1.01 | 0.84 | 1.01 | 2.99 | 81 | |||||||||||||||||||||||||
12.81 | 17.91 | 302,088 | 0.84 | 1.00 | 0.84 | 1.00 | 3.20 | 95 | ||||||||||||||||||||||||||
11.87 | 17.32 | 579,198 | 0.83 | 1.00 | 0.83 | 1.00 | 3.74 | 108 | ||||||||||||||||||||||||||
10.47 | 6.95 | 315,513 | 0.83 | * | 1.20 | * | 0.83 | * | 1.20 | * | 4.98 | * | 21 | |||||||||||||||||||||
5.50 | (12.87 | ) | 1,235 | 0.94 | * | 1.11 | * | 0.94 | * | 1.11 | * | 2.56 | * | 45 | ||||||||||||||||||||
7.35 | (0.48 | ) | 2,604 | 0.94 | 1.11 | 0.94 | 1.11 | 2.76 | 81 | |||||||||||||||||||||||||
12.82 | 17.84 | 3,652 | 0.94 | 1.10 | 0.94 | 1.10 | 3.38 | 95 | ||||||||||||||||||||||||||
11.88 | 17.21 | 1,435 | 0.93 | 1.10 | 0.93 | 1.10 | 3.98 | 108 | ||||||||||||||||||||||||||
10.48 | 7.00 | 71 | 0.93 | * | 1.33 | * | 0.93 | * | 1.33 | * | 5.11 | * | 21 | |||||||||||||||||||||
5.50 | (12.99 | ) | 1,258 | 1.19 | * | 1.36 | * | 1.19 | * | 1.36 | * | 2.30 | * | 45 | ||||||||||||||||||||
7.35 | (0.66 | ) | 2,299 | 1.19 | 1.36 | 1.19 | 1.36 | 2.42 | 81 | |||||||||||||||||||||||||
12.81 | 17.57 | 7,709 | 1.19 | 1.35 | 1.19 | 1.35 | 3.17 | 95 | ||||||||||||||||||||||||||
11.87 | 16.85 | 7,801 | 1.18 | 1.35 | 1.18 | 1.35 | 3.41 | 108 | ||||||||||||||||||||||||||
10.48 | 6.86 | 1,251 | 1.18 | * | 1.67 | * | 1.18 | * | 1.67 | * | 5.25 | * | 21 | |||||||||||||||||||||
5.50 | (12.99 | ) | 26,088 | 1.19 | * | 1.36 | * | 1.19 | * | 1.36 | * | 2.31 | * | 45 | ||||||||||||||||||||
7.35 | (0.74 | ) | 37,645 | 1.19 | 1.36 | 1.19 | 1.36 | 2.68 | 81 | |||||||||||||||||||||||||
12.82 | 17.56 | 59,540 | 1.19 | 1.35 | 1.19 | 1.35 | 3.14 | 95 | ||||||||||||||||||||||||||
11.88 | 16.95 | 27,729 | 1.18 | 1.35 | 1.18 | 1.35 | 3.63 | 108 | ||||||||||||||||||||||||||
10.48 | 6.86 | 2,529 | 1.18 | * | 1.51 | * | 1.18 | * | 1.51 | * | 4.74 | * | 21 |
Please see footnotes on page 24.
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 23 |
Table of Contents
Financial Highlights (Cont.)
Selected Per Share Data for the Year or Period Ended: | Net Asset Value Beginning of Year or Period | Net Investment Income (Loss) (a) | Net Realized/ Unrealized Gain (Loss) | Total from Investment Operations | Dividends | Distributions from Net Realized Capital Gains (b) | Total Distributions | |||||||||||||||||||||
PIMCO Global Dividend Fund (Cont.) | ||||||||||||||||||||||||||||
Class C | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 7.31 | $ | 0.05 | $ | (1.04 | ) | $ | (0.99 | ) | $ | (0.06 | ) | $ | (0.80 | ) | $ | (0.86 | ) | |||||||||
06/30/2015 | 12.77 | 0.18 | (0.46 | ) | (0.28 | ) | (0.15 | ) | (5.03 | ) | (5.18 | ) | ||||||||||||||||
06/30/2014 | 11.84 | 0.30 | 1.60 | 1.90 | (0.35 | ) | (0.62 | ) | (0.97 | ) | ||||||||||||||||||
06/30/2013 | 10.45 | 0.36 | 1.32 | 1.68 | (0.26 | ) | (0.03 | ) | (0.29 | ) | ||||||||||||||||||
12/14/2011 - 06/30/2012 | 10.00 | 0.23 | 0.39 | 0.62 | (0.17 | ) | 0.00 | (0.17 | ) | |||||||||||||||||||
Class R | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 7.34 | 0.06 | (1.03 | ) | (0.97 | ) | (0.08 | ) | (0.80 | ) | (0.88 | ) | ||||||||||||||||
06/30/2015 | 12.81 | 0.21 | (0.45 | ) | (0.24 | ) | (0.20 | ) | (5.03 | ) | (5.23 | ) | ||||||||||||||||
06/30/2014 | 11.87 | 0.38 | 1.59 | 1.97 | (0.41 | ) | (0.62 | ) | (1.03 | ) | ||||||||||||||||||
06/30/2013 | 10.47 | 0.36 | 1.38 | 1.74 | (0.31 | ) | (0.03 | ) | (0.34 | ) | ||||||||||||||||||
12/14/2011 - 06/30/2012 | 10.00 | 0.18 | 0.48 | 0.66 | (0.19 | ) | 0.00 | (0.19 | ) | |||||||||||||||||||
PIMCO International Dividend Fund | ||||||||||||||||||||||||||||
Institutional Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 10.49 | $ | 0.11 | $ | (1.46 | ) | $ | (1.35 | ) | $ | (0.15 | ) | $ | (0.18 | ) | $ | (0.33 | ) | |||||||||
12/15/2014 - 06/30/2015 | 10.00 | 0.19 | 0.46 | 0.65 | (0.16 | ) | 0.00 | (0.16 | ) | |||||||||||||||||||
Class P | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.49 | 0.10 | (1.46 | ) | (1.36 | ) | (0.14 | ) | (0.18 | ) | (0.32 | ) | ||||||||||||||||
12/15/2014 - 06/30/2015 | 10.00 | 0.30 | 0.35 | 0.65 | (0.16 | ) | 0.00 | (0.16 | ) | |||||||||||||||||||
Class D | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.49 | 0.09 | (1.46 | ) | (1.37 | ) | (0.13 | ) | (0.18 | ) | (0.31 | ) | ||||||||||||||||
12/15/2014 - 06/30/2015 | 10.00 | 0.24 | 0.39 | 0.63 | (0.14 | ) | 0.00 | (0.14 | ) | |||||||||||||||||||
Class A | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.50 | 0.10 | (1.47 | ) | (1.37 | ) | (0.13 | ) | (0.18 | ) | (0.31 | ) | ||||||||||||||||
12/15/2014 - 06/30/2015 | 10.00 | 0.26 | 0.38 | 0.64 | (0.14 | ) | 0.00 | (0.14 | ) | |||||||||||||||||||
Class C | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.49 | 0.06 | (1.47 | ) | (1.41 | ) | (0.09 | ) | (0.18 | ) | (0.27 | ) | ||||||||||||||||
12/15/2014 - 06/30/2015 | 10.00 | 0.21 | 0.38 | 0.59 | (0.10 | ) | 0.00 | (0.10 | ) | |||||||||||||||||||
PIMCO U.S. Dividend Fund | ||||||||||||||||||||||||||||
Institutional Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 10.10 | $ | 0.15 | $ | (1.46 | ) | $ | (1.31 | ) | $ | (0.15 | ) | $ | (0.15 | ) | $ | (0.30 | ) | |||||||||
12/15/2014 - 06/30/2015 | 10.00 | 0.16 | 0.09 | 0.25 | (0.15 | ) | 0.00 | (0.15 | ) | |||||||||||||||||||
Class P | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.09 | 0.14 | (1.45 | ) | (1.31 | ) | (0.14 | ) | (0.15 | ) | (0.29 | ) | ||||||||||||||||
12/15/2014 - 06/30/2015 | 10.00 | 0.15 | 0.08 | 0.23 | (0.14 | ) | 0.00 | (0.14 | ) | |||||||||||||||||||
Class D | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.09 | 0.14 | (1.46 | ) | (1.32 | ) | (0.13 | ) | (0.15 | ) | (0.28 | ) | ||||||||||||||||
12/15/2014 - 06/30/2015 | 10.00 | 0.09 | 0.13 | 0.22 | (0.13 | ) | 0.00 | (0.13 | ) | |||||||||||||||||||
Class A | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.11 | 0.13 | (1.46 | ) | (1.33 | ) | (0.13 | ) | (0.15 | ) | (0.28 | ) | ||||||||||||||||
12/15/2014 - 06/30/2015 | 10.00 | 0.15 | 0.09 | 0.24 | (0.13 | ) | 0.00 | (0.13 | ) | |||||||||||||||||||
Class C | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.10 | 0.10 | (1.45 | ) | (1.35 | ) | (0.10 | ) | (0.15 | ) | (0.25 | ) | ||||||||||||||||
12/15/2014 - 06/30/2015 | 10.00 | 0.11 | 0.08 | 0.19 | (0.09 | ) | 0.00 | (0.09 | ) |
+ | Unaudited |
* | Annualized |
^ | Reflects an amount rounding to less than one cent. |
(a) | Per share amounts based on average number of shares outstanding during the year or period. |
(b) | Determined in accordance with federal income tax regulations, see Note 2(d) in the Notes to Financial Statements for more information. |
(c) | The amount previously reported as 763% in the Fund’s annual report has been restated, as above. |
24 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
Net Asset Value End of Year or Period | Total Return | Net Assets End of Year or Period (000s) | Ratio of Expenses to Average Net Assets | Ratio of Expenses to Average Net Assets Excluding Waivers | Ratio of Expenses to Average Net Assets Excluding Interest Expense and Dividends on Securities Sold Short | Ratio of Expenses to Average Net Assets Excluding Interest Expense and Dividends on Securities Sold Short and Waivers | Ratio of Net Investment Income (Loss) to Average Net Assets | Portfolio Turnover Rate | ||||||||||||||||||||||||||
$ | 5.46 | (13.45 | )% | $ | 18,736 | 1.94 | %* | 2.11 | %* | 1.94 | %* | 2.11 | %* | 1.55 | %* | 45 | % | |||||||||||||||||
7.31 | (1.44 | ) | 27,097 | 1.94 | 2.11 | 1.94 | 2.11 | 1.94 | 81 | |||||||||||||||||||||||||
12.77 | 16.69 | 39,359 | 1.94 | 2.10 | 1.94 | 2.10 | 2.45 | 95 | ||||||||||||||||||||||||||
11.84 | 16.14 | 14,150 | 1.93 | 2.10 | 1.93 | 2.10 | 3.05 | 108 | ||||||||||||||||||||||||||
10.45 | 6.19 | 1,275 | 1.93 | * | 2.26 | * | 1.93 | * | 2.26 | * | 4.11 | * | 21 | |||||||||||||||||||||
5.49 | (13.15 | ) | 3 | 1.44 | * | 1.61 | * | 1.44 | * | 1.61 | * | 1.77 | * | 45 | ||||||||||||||||||||
7.34 | (1.00 | ) | 57 | 1.44 | 1.61 | 1.44 | 1.61 | 2.09 | 81 | |||||||||||||||||||||||||
12.81 | 17.29 | 192 | 1.44 | 1.60 | 1.44 | 1.60 | 3.08 | 95 | ||||||||||||||||||||||||||
11.87 | 16.71 | 100 | 1.43 | 1.60 | 1.43 | 1.60 | 3.05 | 108 | ||||||||||||||||||||||||||
10.47 | 6.63 | 11 | 1.43 | * | 1.67 | * | 1.43 | * | 1.67 | * | 3.24 | * | 21 | |||||||||||||||||||||
$ | 8.81 | (12.88 | )% | $ | 3,806 | 0.84 | %* | 1.01 | %* | 0.84 | %* | 1.01 | %* | 2.32 | %* | 46 | % | |||||||||||||||||
10.49 | 6.53 | 4,634 | 0.84 | * | 2.64 | * | 0.84 | * | 2.64 | * | 3.28 | * | 69 | |||||||||||||||||||||
8.81 | (12.93 | ) | 37 | 0.94 | * | 1.11 | * | 0.94 | * | 1.11 | * | 1.89 | * | 46 | ||||||||||||||||||||
10.49 | 6.48 | 1,727 | 0.94 | * | 2.74 | * | 0.94 | * | 2.74 | * | 5.12 | * | 69 | |||||||||||||||||||||
8.81 | (13.04 | ) | 188 | 1.19 | * | 1.36 | * | 1.19 | * | 1.36 | * | 1.91 | * | 46 | ||||||||||||||||||||
10.49 | 6.33 | 239 | 1.19 | * | 2.99 | * | 1.19 | * | 2.99 | * | 4.03 | * | 69 | |||||||||||||||||||||
8.82 | (13.03 | ) | 755 | 1.19 | * | 1.36 | * | 1.19 | * | 1.36 | * | 1.97 | * | 46 | ||||||||||||||||||||
10.50 | 6.44 | 1,000 | 1.19 | * | 2.99 | * | 1.19 | * | 2.99 | * | 4.49 | * | 69 | |||||||||||||||||||||
8.81 | (13.40 | ) | 606 | 1.94 | * | 2.11 | * | 1.94 | * | 2.11 | * | 1.25 | * | 46 | ||||||||||||||||||||
10.49 | 5.91 | 594 | 1.94 | * | 3.74 | * | 1.94 | * | 3.74 | * | 3.56 | * | 69 | |||||||||||||||||||||
$ | 8.49 | (12.98 | )% | $ | 3,747 | 0.75 | %* | 0.92 | %* | 0.75 | %* | 0.92 | %* | 3.14 | %* | 37 | % | |||||||||||||||||
10.10 | 2.44 | 4,191 | 0.75 | * | 2.68 | * | 0.75 | * | 2.68 | * | 2.89 | * | 41 | |||||||||||||||||||||
8.49 | (12.94 | ) | 9 | 0.85 | * | 1.02 | * | 0.85 | * | 1.02 | * | 3.04 | * | 37 | ||||||||||||||||||||
10.09 | 2.28 | 10 | 0.85 | * | 2.78 | * | 0.85 | * | 2.78 | * | 2.68 | * | 41 | |||||||||||||||||||||
8.49 | (13.06 | ) | 63 | 1.10 | * | 1.27 | * | 1.10 | * | 1.27 | * | 2.96 | * | 37 | ||||||||||||||||||||
10.09 | 2.14 | 19 | 1.10 | * | 3.03 | * | 1.10 | * | 3.03 | * | 1.54 | * | 41 | |||||||||||||||||||||
8.50 | (13.13 | ) | 1,159 | 1.10 | * | 1.27 | * | 1.10 | * | 1.27 | * | 2.86 | * | 37 | ||||||||||||||||||||
10.11 | 2.34 | 750 | 1.10 | * | 3.03 | * | 1.10 | * | 3.03 | * | 2.55 | * | 41 | |||||||||||||||||||||
8.50 | (13.40 | ) | 893 | 1.85 | * | 2.02 | * | 1.85 | * | 2.02 | * | 2.09 | * | 37 | ||||||||||||||||||||
10.10 | 1.83 | 606 | 1.85 | * | 3.78 | * | 1.85 | * | 3.78 | * | 1.96 | * | 41 |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 25 |
Table of Contents
Statements of Assets and Liabilities
(Amounts in thousands†, except per share amounts) | PIMCO Balanced Income Fund | PIMCO Dividend and Income Builder Fund | PIMCO EqS® Long/Short Fund | PIMCO Global Dividend Fund | PIMCO International Dividend Fund | PIMCO U.S. Dividend Fund | ||||||||||||||||||
Assets: | ||||||||||||||||||||||||
Investments, at value | ||||||||||||||||||||||||
Investments in securities* | $ | 13,833 | $ | 609,774 | $ | 578,945 | $ | 95,393 | $ | 5,308 | $ | 5,651 | ||||||||||||
Investments in Affiliates | 1,778 | 4,800 | 305,776 | 1,253 | 10 | 140 | ||||||||||||||||||
Financial Derivative Instruments | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | 4 | 30 | 0 | 0 | 0 | 0 | ||||||||||||||||||
Over the counter | 55 | 2,421 | 74 | 261 | 6 | 0 | ||||||||||||||||||
Cash | 372 | 1 | 1 | 1 | 0 | 102 | ||||||||||||||||||
Deposits with counterparty | 119 | 194 | 324,691 | 0 | 0 | 19 | ||||||||||||||||||
Foreign currency, at value | 32 | 3,765 | 645 | 79 | 15 | 2 | ||||||||||||||||||
Receivable for investments sold | 41 | 16,306 | 47,237 | 1,316 | 208 | 52 | ||||||||||||||||||
Receivable for Fund shares sold | 652 | 1,037 | 4,102 | 1,338 | 0 | 46 | ||||||||||||||||||
Interest and dividends receivable | 63 | 3,445 | 346 | 540 | 17 | 15 | ||||||||||||||||||
Dividends receivable from Affiliates | 1 | 3 | 161 | 0 | 0 | 0 | ||||||||||||||||||
Reimbursement receivable from PIMCO | 1 | 93 | 120 | 89 | 0 | 0 | ||||||||||||||||||
Total Assets | 16,951 | 641,869 | 1,262,098 | 100,270 | 5,564 | 6,027 | ||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||
Borrowings & Other Financing Transactions | ||||||||||||||||||||||||
Payable for short sales | $ | 0 | $ | 0 | $ | 320,587 | $ | 0 | $ | 0 | $ | 0 | ||||||||||||
Financial Derivative Instruments | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | 7 | 1 | 0 | 0 | 0 | 1 | ||||||||||||||||||
Over the counter | 176 | 2,029 | 354 | 335 | 14 | 0 | ||||||||||||||||||
Payable for investments purchased | 219 | 16,214 | 76,648 | 1,537 | 73 | 148 | ||||||||||||||||||
Payable for investments in Affiliates purchased | 1 | 3 | 161 | 0 | 0 | 0 | ||||||||||||||||||
Deposits from counterparty | 0 | 1,250 | 29 | 0 | 0 | 0 | ||||||||||||||||||
Payable for Fund shares redeemed | 84 | 16,626 | 1,018 | 702 | 5 | 2 | ||||||||||||||||||
Dividends payable | 2 | 1,095 | 0 | 2 | 0 | 0 | ||||||||||||||||||
Overdraft due to custodian | 0 | 0 | 0 | 0 | 74 | 0 | ||||||||||||||||||
Accrued investment advisory fees | 6 | 320 | 826 | 50 | 3 | 2 | ||||||||||||||||||
Accrued supervisory and administrative fees | 5 | 238 | 416 | 33 | 2 | 2 | ||||||||||||||||||
Accrued distribution fees | 3 | 195 | 119 | 13 | 0 | 1 | ||||||||||||||||||
Accrued servicing fees | 2 | 117 | 72 | 11 | 0 | 0 | ||||||||||||||||||
Other liabilities | 2 | 203 | 645 | 107 | 1 | 0 | ||||||||||||||||||
Total Liabilities | 507 | 38,291 | 400,875 | 2,790 | 172 | 156 | ||||||||||||||||||
Net Assets | $ | 16,444 | $ | 603,578 | $ | 861,223 | $ | 97,480 | $ | 5,392 | $ | 5,871 | ||||||||||||
Net Assets Consist of: | ||||||||||||||||||||||||
Paid in capital | $ | 18,411 | $ | 736,099 | $ | 849,461 | $ | 113,770 | $ | 6,560 | $ | 6,852 | ||||||||||||
Undistributed (overdistributed) net investment income | (61 | ) | (1,104 | ) | (6,759 | ) | (18 | ) | (7 | ) | 1 | |||||||||||||
Accumulated undistributed net realized (loss) | (814 | ) | (70,949 | ) | (9,062 | ) | (9,673 | ) | (756 | ) | (641 | ) | ||||||||||||
Net unrealized appreciation (depreciation) | (1,092 | ) | (60,468 | ) | 27,583 | (6,599 | ) | (405 | ) | (341 | ) | |||||||||||||
$ | 16,444 | $ | 603,578 | $ | 861,223 | $ | 97,480 | $ | 5,392 | $ | 5,871 | |||||||||||||
Cost of investments in securities | $ | 14,944 | $ | 670,653 | $ | 556,375 | $ | 101,876 | $ | 5,703 | $ | 5,991 | ||||||||||||
Cost of investments in Affiliates | $ | 1,783 | $ | 4,800 | $ | 307,000 | $ | 1,253 | $ | 10 | $ | 140 | ||||||||||||
Cost of foreign currency held | $ | 32 | $ | 3,769 | $ | 654 | $ | 81 | $ | 16 | $ | 2 | ||||||||||||
Proceeds received on short sales | $ | 0 | $ | 0 | $ | 327,141 | $ | 0 | $ | 0 | $ | 0 | ||||||||||||
Cost or premiums of financial derivative instruments, net | $ | (123 | ) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | |||||||||||
* Includes repurchase agreements of: | $ | 0 | $ | 1,159 | $ | 517 | $ | 766 | $ | 0 | $ | 0 |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
26 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
(Amounts in thousands†, except per share amounts) | PIMCO Balanced Income Fund | PIMCO Dividend and Income Builder Fund | PIMCO EqS® Long/Short Fund | PIMCO Global Dividend Fund | PIMCO International Dividend Fund | PIMCO U.S. Dividend Fund | ||||||||||||||||||
Net Assets: | ||||||||||||||||||||||||
Institutional Class | $ | 6,350 | $ | 33,358 | $ | 223,239 | $ | 50,160 | $ | 3,806 | $ | 3,747 | ||||||||||||
Class P | 119 | 63,295 | 275,064 | 1,235 | 37 | 9 | ||||||||||||||||||
Class D | 490 | 25,106 | 55,781 | 1,258 | 188 | 63 | ||||||||||||||||||
Class A | 4,748 | 223,538 | 154,923 | 26,088 | 755 | 1,159 | ||||||||||||||||||
Class C | 4,737 | 258,030 | 152,216 | 18,736 | 606 | 893 | ||||||||||||||||||
Class R | NA | 251 | NA | 3 | NA | NA | ||||||||||||||||||
Shares Issued and Outstanding: | ||||||||||||||||||||||||
Institutional Class | 712 | 3,360 | 19,150 | 9,128 | 432 | 442 | ||||||||||||||||||
Class P | 13 | 6,373 | 23,701 | 225 | 4 | 1 | ||||||||||||||||||
Class D | 55 | 2,530 | 4,844 | 229 | 21 | 7 | ||||||||||||||||||
Class A | 532 | 22,522 | 13,464 | 4,745 | 86 | 136 | ||||||||||||||||||
Class C | 530 | 26,045 | 13,562 | 3,429 | 69 | 105 | ||||||||||||||||||
Class R | NA | 25 | NA | 1 | NA | NA | ||||||||||||||||||
Net Asset Value and Redemption Price^ Per Share Outstanding: | ||||||||||||||||||||||||
Institutional Class | $ | 8.93 | $ | 9.93 | $ | 11.66 | $ | 5.49 | $ | 8.81 | $ | 8.49 | ||||||||||||
Class P | 8.93 | 9.93 | 11.61 | 5.50 | 8.81 | 8.49 | ||||||||||||||||||
Class D | 8.93 | 9.92 | 11.52 | 5.50 | 8.81 | 8.49 | ||||||||||||||||||
Class A | 8.93 | 9.93 | 11.51 | 5.50 | 8.82 | 8.50 | ||||||||||||||||||
Class C | 8.93 | 9.91 | 11.22 | 5.46 | 8.81 | 8.50 | ||||||||||||||||||
Class R | NA | 9.93 | NA | 5.49 | NA | NA |
^ | With respect to Class A and Class C, the redemption price varies by the length of time the shares are held. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 27 |
Table of Contents
(Unaudited)
Six Months Ended December 31, 2015 | ||||||||||||||||||||||||
(Amounts in thousands†) | PIMCO Balanced Income Fund | PIMCO Dividend and Income Builder Fund | PIMCO EqS® Long/Short Fund | PIMCO Global Dividend Fund | PIMCO International Dividend Fund | PIMCO U.S. Dividend Fund | ||||||||||||||||||
Investment Income: | ||||||||||||||||||||||||
Interest | $ | 112 | $ | 1,720 | $ | 125 | $ | 0 | $ | 0 | $ | 0 | ||||||||||||
Dividends, net of foreign taxes* | 187 | 14,828 | 3,946 | 2,056 | 98 | 110 | ||||||||||||||||||
Dividends from Investments in Affiliates | 14 | 83 | 1,950 | 5 | 0 | 2 | ||||||||||||||||||
Total Income | 313 | 16,631 | 6,021 | 2,061 | 98 | 112 | ||||||||||||||||||
Expenses: | ||||||||||||||||||||||||
Investment advisory fees | 47 | 2,801 | 4,629 | 408 | 22 | 17 | ||||||||||||||||||
Supervisory and administrative fees | 28 | 1,597 | 2,314 | 208 | 10 | 10 | ||||||||||||||||||
Distribution and/or servicing fees - Class D | 1 | 41 | 64 | 2 | 0 | 0 | ||||||||||||||||||
Distribution fees - Class C | 16 | 1,221 | 567 | 87 | 3 | 3 | ||||||||||||||||||
Servicing fees - Class A | 5 | 344 | 215 | 41 | 1 | 1 | ||||||||||||||||||
Servicing fees - Class C | 5 | 407 | 189 | 29 | 1 | 1 | ||||||||||||||||||
Dividends on short sales | 0 | 0 | 2,985 | 0 | 0 | 0 | ||||||||||||||||||
Trustee fees | 1 | 37 | 37 | 5 | 0 | 0 | ||||||||||||||||||
Interest expense | 0 | 3 | 1,878 | 0 | 0 | 0 | ||||||||||||||||||
Miscellaneous expense | 1 | 20 | 22 | 4 | 0 | 0 | ||||||||||||||||||
Total Expenses | 104 | 6,471 | 12,900 | 784 | 37 | 32 | ||||||||||||||||||
Waiver and/or Reimbursement by PIMCO | (12 | ) | (686 | ) | (37 | ) | (100 | ) | (5 | ) | (5 | ) | ||||||||||||
Net Expenses | 92 | 5,785 | 12,863 | 684 | 32 | 27 | ||||||||||||||||||
Net Investment Income (Loss) | 221 | 10,846 | (6,842 | ) | 1,377 | 66 | 85 | |||||||||||||||||
Net Realized Gain (Loss): | ||||||||||||||||||||||||
Investments in securities | (944 | ) | (75,899 | ) | (25,181 | ) | (8,717 | ) | (584 | ) | (630 | ) | ||||||||||||
Investments in Affiliates | (4 | ) | (63 | ) | (142 | ) | (1 | ) | 0 | (2 | ) | |||||||||||||
Exchange-traded or centrally cleared financial derivative instruments | 13 | 175 | (4,660 | ) | (10 | ) | 0 | (1 | ) | |||||||||||||||
Over the counter financial derivative instruments | 130 | 4,161 | 786 | 336 | 23 | 0 | ||||||||||||||||||
Short sales | 0 | 0 | 36,849 | 0 | 0 | 0 | ||||||||||||||||||
Foreign currency | (1 | ) | (99 | ) | (161 | ) | (87 | ) | 2 | 0 | ||||||||||||||
Net Realized Gain (Loss) | (806 | ) | (71,725 | ) | 7,491 | (8,479 | ) | (559 | ) | (633 | ) | |||||||||||||
Net Change in Unrealized Appreciation (Depreciation): | ||||||||||||||||||||||||
Investments in securities | (688 | ) | (44,796 | ) | (25,879 | ) | (9,365 | ) | (338 | ) | (223 | ) | ||||||||||||
Investments in Affiliates | (5 | ) | 0 | (1,213 | ) | 0 | 0 | 0 | ||||||||||||||||
Exchange-traded or centrally cleared financial derivative instruments | 26 | 164 | 2,144 | 0 | 0 | (1 | ) | |||||||||||||||||
Over the counter financial derivative instruments | (14 | ) | 1,819 | (191 | ) | 210 | (9 | ) | 0 | |||||||||||||||
Short sales | 0 | 0 | 3,280 | 0 | 0 | 0 | ||||||||||||||||||
Foreign currency assets and liabilities | 0 | (20 | ) | (463 | ) | (1 | ) | (1 | ) | 0 | ||||||||||||||
Net Change in Unrealized (Depreciation) | (681 | ) | (42,833 | ) | (22,322 | ) | (9,156 | ) | (348 | ) | (224 | ) | ||||||||||||
Net (Decrease) in Net Assets Resulting from Operations | $ | (1,266 | ) | $ | (103,712 | ) | $ | (21,673 | ) | $ | (16,258 | ) | $ | (841 | ) | $ | (772 | ) | ||||||
* Foreign tax withholdings - Dividends | $ | 6 | $ | 460 | $ | 0 | $ | 67 | $ | 6 | $ | 0 |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
28 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
Statements of Changes in Net Assets
PIMCO Balanced Income Fund | PIMCO Dividend and Income Builder Fund | PIMCO EqS® Long/Short Fund | ||||||||||||||||||||||
(Amounts in thousands†) | Six Months Ended | Year Ended June 30, 2015 | Six Months Ended December 31, 2015 (Unaudited) | Year Ended June 30, 2015 | Six Months Ended December 31, 2015 (Unaudited) | Year Ended June 30, 2015 | ||||||||||||||||||
Increase (Decrease) in Net Assets from: | ||||||||||||||||||||||||
Operations: | ||||||||||||||||||||||||
Net investment income (loss) | $ | 221 | $ | 296 | $ | 10,846 | $ | 28,545 | $ | (6,842 | ) | $ | (847 | ) | ||||||||||
Net realized gain (loss) | (806 | ) | 269 | (71,725 | ) | 55,272 | 7,491 | 29,852 | ||||||||||||||||
Net change in unrealized (depreciation) | (681 | ) | (497 | ) | (42,833 | ) | (97,681 | ) | (22,322 | ) | (33,398 | ) | ||||||||||||
Net Increase (Decrease) in Net Assets Resulting from Operations | (1,266 | ) | 68 | (103,712 | ) | (13,864 | ) | (21,673 | ) | (4,393 | ) | |||||||||||||
Distributions to Shareholders: | ||||||||||||||||||||||||
From net investment income (a) | ||||||||||||||||||||||||
Institutional Class | (168 | ) | (210 | ) | (920 | ) | (2,553 | ) | 0 | 0 | ||||||||||||||
Class P | (3 | ) | (3 | ) | (2,073 | ) | (5,752 | ) | 0 | 0 | ||||||||||||||
Class D | (11 | ) | (6 | ) | (519 | ) | (1,023 | ) | 0 | 0 | ||||||||||||||
Class A | (91 | ) | (48 | ) | (4,367 | ) | (9,496 | ) | 0 | 0 | ||||||||||||||
Class C | (83 | ) | (43 | ) | (3,905 | ) | (8,670 | ) | 0 | 0 | ||||||||||||||
Class R | 0 | 0 | (4 | ) | (11 | ) | 0 | 0 | ||||||||||||||||
From net realized capital gains (a) | ||||||||||||||||||||||||
Institutional Class | (76 | ) | (6 | ) | (2,576 | ) | (1,739 | ) | (2,579 | ) | (1,891 | ) | ||||||||||||
Class P | (1 | ) | (0 | ) | (5,302 | ) | (4,480 | ) | (3,081 | ) | (1,253 | ) | ||||||||||||
Class D | (6 | ) | (0 | ) | (1,876 | ) | (690 | ) | (641 | ) | (248 | ) | ||||||||||||
Class A | (48 | ) | (1 | ) | (16,603 | ) | (7,435 | ) | (1,768 | ) | (961 | ) | ||||||||||||
Class C | (52 | ) | (2 | ) | (19,121 | ) | (8,792 | ) | (1,826 | ) | (787 | ) | ||||||||||||
Class R | 0 | 0 | (18 | ) | (11 | ) | 0 | 0 | ||||||||||||||||
Total Distributions | (539 | ) | (319 | ) | (57,284 | ) | (50,652 | ) | (9,895 | ) | (5,140 | ) | ||||||||||||
Portfolio Share Transactions: | ||||||||||||||||||||||||
Net increase (decrease) resulting from Fund share transactions** | 2,070 | 9,310 | (169,688 | ) | 43,260 | 27,683 | (622,945 | ) | ||||||||||||||||
Total Increase (Decrease) in Net Assets | 265 | 9,059 | (330,684 | ) | (21,256 | ) | (3,885 | ) | (632,478 | ) | ||||||||||||||
Net Assets: | ||||||||||||||||||||||||
Beginning of year or period | 16,179 | 7,120 | 934,262 | 955,518 | 865,108 | 1,497,586 | ||||||||||||||||||
End of year or period* | $ | 16,444 | $ | 16,179 | $ | 603,578 | $ | 934,262 | $ | 861,223 | $ | 865,108 | ||||||||||||
* Including undistributed (overdistributed) net investment income of: | $ | (61 | ) | $ | 74 | $ | (1,104 | ) | $ | (162 | ) | $ | (6,759 | ) | $ | 89 |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
(a) | Determined in accordance with federal income tax regulations, see Note 2(d) in the Notes to Financial Statements for more information. |
** | See Note 12 in the Notes to Financial Statements. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 29 |
Table of Contents
Statements of Changes in Net Assets (Cont.)
PIMCO Global Dividend Fund | PIMCO | PIMCO U.S. Dividend Fund | ||||||||||||||||||||||
(Amounts in thousands†) | Six Months Ended | Year Ended June 30, 2015 | Six Months Ended December 31, 2015 (Unaudited) | Inception date through June 30, 2015 | Six Months Ended December 31, 2015 (Unaudited) | Inception date through June 30, 2015 | ||||||||||||||||||
Increase (Decrease) in Net Assets from: | ||||||||||||||||||||||||
Operations: | ||||||||||||||||||||||||
Net investment income | $ | 1,377 | $ | 4,611 | $ | 66 | $ | 100 | $ | 85 | $ | 71 | ||||||||||||
Net realized gain (loss) | (8,479 | ) | 37,970 | (559 | ) | (84 | ) | (633 | ) | 80 | ||||||||||||||
Net change in unrealized (depreciation) | (9,156 | ) | (47,759 | ) | (348 | ) | (57 | ) | (224 | ) | (117 | ) | ||||||||||||
Net Increase (Decrease) in Net Assets Resulting from Operations |
| (16,258 | ) | (5,178 | ) | (841 | ) | (41 | ) | (772 | ) | 34 | ||||||||||||
Distributions to Shareholders: | ||||||||||||||||||||||||
From net investment income (a) | ||||||||||||||||||||||||
Institutional Class | (842 | ) | (2,250 | ) | (63 | ) | (65 | ) | (62 | ) | (56 | ) | ||||||||||||
Class P | (32 | ) | (100 | ) | (5 | ) | (15 | ) | (0 | ) | (0 | ) | ||||||||||||
Class D | (24 | ) | (113 | ) | (3 | ) | (2 | ) | (1 | ) | (0 | ) | ||||||||||||
Class A | (425 | ) | (1,034 | ) | (12 | ) | (5 | ) | (13 | ) | (4 | ) | ||||||||||||
Class C | (209 | ) | (469 | ) | (6 | ) | (3 | ) | (8 | ) | (3 | ) | ||||||||||||
Class R | (0 | ) | (3 | ) | 0 | 0 | 0 | 0 | ||||||||||||||||
From net realized capital gains (a) | ||||||||||||||||||||||||
Institutional Class | (7,070 | ) | (24,159 | ) | (76 | ) | 0 | (64 | ) | 0 | ||||||||||||||
Class P | (202 | ) | (1,929 | ) | (1 | ) | 0 | (0 | ) | 0 | ||||||||||||||
Class D | (162 | ) | (1,958 | ) | (4 | ) | 0 | (1 | ) | 0 | ||||||||||||||
Class A | (3,352 | ) | (18,177 | ) | (14 | ) | 0 | (17 | ) | 0 | ||||||||||||||
Class C | (2,384 | ) | (13,153 | ) | (12 | ) | 0 | (16 | ) | 0 | ||||||||||||||
Class R | (1 | ) | (56 | ) | 0 | 0 | 0 | 0 | ||||||||||||||||
Total Distributions | (14,703 | ) | (63,401 | ) | (196 | ) | (90 | ) | (182 | ) | (63 | ) | ||||||||||||
Portfolio Share Transactions: | ||||||||||||||||||||||||
Net increase (decrease) resulting from Fund share transactions** |
| 527 |
| (216,047 | ) | (1,765 | ) | 8,325 | 1,249 | 5,605 | ||||||||||||||
Total Increase (Decrease) in Net Assets | (30,434 | ) | (284,626 | ) | (2,802 | ) | 8,194 | 295 | 5,576 | |||||||||||||||
Net Assets: | ||||||||||||||||||||||||
Beginning of year or period | 127,914 | 412,540 | 8,194 | 0 | 5,576 | 0 | ||||||||||||||||||
End of year or period* | $ | 97,480 | $ | 127,914 | $ | 5,392 | $ | 8,194 | $ | 5,871 | $ | 5,576 | ||||||||||||
* Including undistributed (overdistributed) net investment income of: | $ | (18 | ) | $ | 137 | $ | (7 | ) | $ | 16 | $ | 1 | $ | 0 |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
(a) | Determined in accordance with federal income tax regulations, see Note 2(d) in the Notes to Financial Statements for more information. |
** | See Note 12 in the Notes to Financial Statements. |
30 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
Six Months Ended December 31, 2015 (Unaudited) | ||||
(Amounts in thousands) | PIMCO EqS® Long/Short | |||
Cash Flows Provided by Operating Activities: | ||||
Net (decrease) in net assets resulting from operations | $ | (21,673 | ) | |
Adjustments to Reconcile Net (Decrease) in Net Assets from Operations to Net Cash (Used for) Operating Activities: | ||||
Purchases of long-term securities | (1,977,575 | ) | ||
Proceeds from sales of long-term securities | 2,137,102 | |||
Purchases of short-term portfolio investments, net | (283,423 | ) | ||
(Increase) in deposits with counterparty | (155,453 | ) | ||
Decrease in receivable for investments sold | 235,458 | |||
Decrease in interest and dividends receivable | 310 | |||
(Increase) in exchange-traded or centrally cleared financial derivative instruments | (2,739 | ) | ||
Decrease in over the counter financial derivative instruments | 786 | |||
(Increase) in reimbursement receivable from PIMCO | (15 | ) | ||
(Decrease) in payable for investments purchased | (133,075 | ) | ||
Increase in deposits from counterparty | 29 | |||
Increase in accrued investment advisory fees | 70 | |||
Increase in accrued supervisory and administrative fees | 42 | |||
Increase in accrued distribution fees | 22 | |||
Increase in accrued servicing fees | 7 | |||
Proceeds from short sales transactions, net | 173,414 | |||
Payments on foreign currency transactions | (624 | ) | ||
Increase in other liabilities | 382 | |||
Net Realized (Gain) Loss | ||||
Investments in securities | 25,181 | |||
Investments in Affiliates | 142 | |||
Exchange-traded or centrally cleared financial derivative instruments | 4,660 | |||
Over the counter financial derivative instruments | (786 | ) | ||
Short sales | (36,849 | ) | ||
Foreign currency | 161 | |||
Net Change in Unrealized (Appreciation) Depreciation | ||||
Investments in securities | 25,879 | |||
Investments in Affiliates | 1,213 | |||
Exchange-traded or centrally cleared financial derivative instruments | (2,144 | ) | ||
Over the counter financial derivative instruments | 191 | |||
Short sales | (3,280 | ) | ||
Foreign currency assets and liabilities | 463 | |||
Net amortization (accretion) on investments | 238 | |||
Net Cash (Used for) Operating Activities | (11,886 | ) | ||
Cash Flows Received from Financing Activities: | ||||
Proceeds from shares sold | 278,439 | |||
Payments on shares redeemed | (265,939 | ) | ||
Cash dividend paid* | (44 | ) | ||
Net Cash Received from Financing Activities | 12,456 | |||
Net Increase in Cash and Foreign Currency | 570 | |||
Cash and Foreign Currency: | ||||
Beginning of period | 76 | |||
End of period | $ | 646 | ||
* Reinvestment of distributions | $ | 9,851 | ||
Supplemental Disclosure of Cash Flow Information: | ||||
Interest expense paid during the period | $ | 1,514 |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 31 |
Table of Contents
Schedule of Investments PIMCO Balanced Income Fund
PRINCIPAL AMOUNT (000S) | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN SECURITIES 84.1% | ||||||||||||
ASSET-BACKED SECURITIES 10.2% | ||||||||||||
CAYMAN ISLANDS 1.0% | ||||||||||||
Diversified Asset Securitization Holdings LP |
| |||||||||||
1.002% due 09/15/2035 | $ | �� | 4 | $ | 4 | |||||||
South Coast Funding |
| |||||||||||
1.587% due 08/06/2039 | 162 | 159 | ||||||||||
|
| |||||||||||
Total Cayman Islands | 163 | |||||||||||
|
| |||||||||||
UNITED STATES 9.2% | ||||||||||||
ACE Securities Corp. Home Equity Loan Trust |
| |||||||||||
0.577% due 08/25/2036 | 51 | 43 | ||||||||||
Ameriquest Mortgage Securities, Inc. Asset-Backed Pass-Through Certificates |
| |||||||||||
1.102% due 09/25/2033 | 39 | 37 | ||||||||||
2.222% due 02/25/2034 | 229 | 216 | ||||||||||
4.285% due 06/25/2033 ^ | 63 | 50 | ||||||||||
Asset-Backed Securities Corp. Home Equity Loan Trust |
| |||||||||||
0.871% due 11/15/2031 | 12 | 11 | ||||||||||
1.172% due 03/25/2035 | 31 | 30 | ||||||||||
Centex Home Equity Loan Trust |
| |||||||||||
1.472% due 01/25/2034 | 120 | 109 | ||||||||||
College & University Facility Loan Trust |
| |||||||||||
4.000% due 06/01/2018 | 12 | 12 | ||||||||||
Countrywide Asset-Backed Certificates |
| |||||||||||
0.922% due 08/26/2033 | 36 | 32 | ||||||||||
1.397% due 02/25/2034 | 31 | 28 | ||||||||||
Fremont Home Loan Trust |
| |||||||||||
0.482% due 01/25/2037 | 144 | 74 | ||||||||||
0.602% due 04/25/2036 | 230 | 196 | ||||||||||
JPMorgan Mortgage Acquisition Corp. |
| |||||||||||
1.082% due 09/25/2035 | 200 | 186 | ||||||||||
Lehman ABS Mortgage Loan Trust |
| |||||||||||
0.622% due 06/25/2037 | 77 | 49 | ||||||||||
Merrill Lynch Mortgage Investors Trust |
| |||||||||||
0.612% due 04/25/2047 | 85 | 49 | ||||||||||
0.702% due 01/25/2047 | 76 | 73 | ||||||||||
Residential Asset Mortgage Products Trust |
| |||||||||||
0.982% due 06/25/2032 | 75 | 71 | ||||||||||
1.062% due 08/25/2032 | 67 | 62 | ||||||||||
Structured Asset Investment Loan Trust |
| |||||||||||
0.572% due 06/25/2036 | 222 | 192 | ||||||||||
|
| |||||||||||
Total United States | 1,520 | |||||||||||
|
| |||||||||||
Total Asset-Backed Securities (Cost $1,679) | 1,683 | |||||||||||
|
| |||||||||||
BANK LOAN OBLIGATIONS 1.9% | ||||||||||||
UNITED STATES 1.9% | ||||||||||||
Davita Healthcare Partners, Inc. |
| |||||||||||
3.500% due 06/24/2021 | 30 | 30 | ||||||||||
Energy Future Intermediate Holding Co. LLC |
| |||||||||||
4.250% due 06/19/2016 | 140 | 140 | ||||||||||
Hilton Worldwide Finance LLC |
| |||||||||||
3.500% due 10/26/2020 | 37 | 37 | ||||||||||
iHeartCommunications, Inc. |
| |||||||||||
7.174% due 01/30/2019 | 30 | 21 | ||||||||||
MGM Resorts International |
| |||||||||||
3.500% due 12/20/2019 | 30 | 29 | ||||||||||
Seadrill Partners Finco LLC |
| |||||||||||
4.000% due 02/21/2021 | 9 | 4 | ||||||||||
Sequa Corp. |
| |||||||||||
5.250% due 06/19/2017 | 20 | 14 | ||||||||||
Univision Communications, Inc. |
| |||||||||||
4.000% due 03/01/2020 | 37 | 37 | ||||||||||
|
| |||||||||||
Total Bank Loan Obligations (Cost $332) | 312 | |||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
COMMON STOCKS 54.1% | ||||||||||||
AUSTRALIA 3.0% | ||||||||||||
CONSUMER DISCRETIONARY 1.0% | ||||||||||||
G8 Education Ltd. | 65,376 | $ | 169 | |||||||||
|
| |||||||||||
HEALTH CARE 0.9% | ||||||||||||
Sonic Healthcare Ltd. | 11,257 | 146 | ||||||||||
|
| |||||||||||
INDUSTRIALS 1.1% | ||||||||||||
Spotless Group Holdings Ltd. | 235,021 | 184 | ||||||||||
|
| |||||||||||
Total Australia | 499 | |||||||||||
|
| |||||||||||
BRAZIL 0.9% | ||||||||||||
HEALTH CARE 0.3% | ||||||||||||
Qualicorp S.A. | 11,905 | 42 | ||||||||||
|
| |||||||||||
INDUSTRIALS 0.4% | ||||||||||||
Arteris S.A. | 28,500 | 69 | ||||||||||
|
| |||||||||||
UTILITIES 0.2% | ||||||||||||
Light S.A. | 16,262 | 41 | ||||||||||
|
| |||||||||||
Total Brazil | 152 | |||||||||||
|
| |||||||||||
CANADA 1.0% | ||||||||||||
UTILITIES 1.0% | ||||||||||||
Capital Power Corp. | 12,866 | 165 | ||||||||||
|
| |||||||||||
Total Canada | 165 | |||||||||||
|
| |||||||||||
FRANCE 2.0% | ||||||||||||
CONSUMER STAPLES 0.8% | ||||||||||||
Carrefour S.A. | 4,912 | 142 | ||||||||||
|
| |||||||||||
UTILITIES 1.2% | ||||||||||||
Engie S.A. | 10,968 | 194 | ||||||||||
|
| |||||||||||
Total France | 336 | |||||||||||
|
| |||||||||||
GERMANY 0.6% | ||||||||||||
MATERIALS 0.6% | ||||||||||||
Covestro AG (b) | 2,615 | 95 | ||||||||||
|
| |||||||||||
Total Germany | 95 | |||||||||||
|
| |||||||||||
GREECE 0.8% | ||||||||||||
CONSUMER DISCRETIONARY 0.8% | ||||||||||||
OPAP S.A. | 15,077 | 132 | ||||||||||
|
| |||||||||||
Total Greece | 132 | |||||||||||
|
| |||||||||||
HONG KONG 1.8% | ||||||||||||
TELECOMMUNICATION SERVICES 1.8% | ||||||||||||
China Mobile Ltd. | 21,500 | 242 | ||||||||||
PCCW Ltd. | 85,000 | 50 | ||||||||||
|
| |||||||||||
292 | ||||||||||||
|
| |||||||||||
Total Hong Kong | 292 | |||||||||||
|
| |||||||||||
SHARES | MARKET VALUE (000S) | |||||||||||
ITALY 2.2% | ||||||||||||
FINANCIALS 1.6% | ||||||||||||
Intesa Sanpaolo SpA | 80,417 | $ | 267 | |||||||||
|
| |||||||||||
INDUSTRIALS 0.6% | ||||||||||||
Societa Iniziative Autostradali e Servizi SpA | 8,675 | 92 | ||||||||||
|
| |||||||||||
Total Italy | 359 | |||||||||||
|
| |||||||||||
JAPAN 0.9% | ||||||||||||
CONSUMER DISCRETIONARY 0.9% | ||||||||||||
Bridgestone Corp. | 4,223 | 145 | ||||||||||
|
| |||||||||||
Total Japan | 145 | |||||||||||
|
| |||||||||||
MEXICO 0.3% | ||||||||||||
CONSUMER STAPLES 0.3% | ||||||||||||
Coca-Cola Femsa S.A.B. de C.V. ‘L’ | 6,100 | 44 | ||||||||||
|
| |||||||||||
Total Mexico | 44 | |||||||||||
|
| |||||||||||
NETHERLANDS 2.6% | ||||||||||||
FINANCIALS 2.6% | ||||||||||||
Aegon NV | 50,554 | 286 | ||||||||||
NN Group NV | 4,113 | 145 | ||||||||||
|
| |||||||||||
431 | ||||||||||||
|
| |||||||||||
Total Netherlands | 431 | |||||||||||
|
| |||||||||||
RUSSIA 0.3% | ||||||||||||
CONSUMER STAPLES 0.3% | ||||||||||||
Magnit PJSC SP - GDR | 1,051 | 42 | ||||||||||
|
| |||||||||||
Total Russia | 42 | |||||||||||
|
| |||||||||||
SPAIN 0.8% | ||||||||||||
CONSUMER STAPLES 0.8% | ||||||||||||
Ebro Foods S.A. | 7,049 | 139 | ||||||||||
|
| |||||||||||
Total Spain | 139 | |||||||||||
|
| |||||||||||
SWITZERLAND 1.8% | ||||||||||||
HEALTH CARE 1.8% | ||||||||||||
Roche Holding AG | 1,042 | 289 | ||||||||||
|
| |||||||||||
Total Switzerland | 289 | |||||||||||
|
| |||||||||||
TAIWAN 1.2% | ||||||||||||
INFORMATION TECHNOLOGY 1.2% | ||||||||||||
Taiwan Semiconductor Manufacturing Co. Ltd. | 44,334 | 191 | ||||||||||
|
| |||||||||||
Total Taiwan | 191 | |||||||||||
|
| |||||||||||
THAILAND 0.2% | ||||||||||||
TELECOMMUNICATION SERVICES 0.2% | ||||||||||||
Total Access Communication PCL NVDR | 45,379 | 38 | ||||||||||
|
| |||||||||||
Total Thailand | 38 | |||||||||||
|
| |||||||||||
32 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
SHARES | MARKET VALUE (000S) | |||||||||||
UNITED KINGDOM 8.1% | ||||||||||||
CONSUMER STAPLES 0.6% | ||||||||||||
Imperial Tobacco Group PLC | 1,838 | $ | 97 | |||||||||
|
| |||||||||||
ENERGY 0.6% | ||||||||||||
Golar LNG Partners LP | 7,368 | 99 | ||||||||||
|
| |||||||||||
FINANCIALS 4.6% | ||||||||||||
HSBC Holdings PLC | 42,112 | 332 | ||||||||||
ICAP PLC | 19,945 | 150 | ||||||||||
Lloyds Banking Group PLC | 265,838 | 286 | ||||||||||
|
| |||||||||||
768 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 2.3% | ||||||||||||
Vodafone Group PLC | 115,258 | 374 | ||||||||||
|
| |||||||||||
Total United Kingdom | 1,338 | |||||||||||
|
| |||||||||||
UNITED STATES 25.6% | ||||||||||||
CONSUMER DISCRETIONARY 3.9% | ||||||||||||
Comcast Corp. ‘A’ | 1,272 | 72 | ||||||||||
General Motors Co. | 6,730 | 229 | ||||||||||
Kohl’s Corp. | 2,571 | 122 | ||||||||||
Macy’s, Inc. | 3,433 | 120 | ||||||||||
SeaWorld Entertainment, Inc. | 4,862 | 96 | ||||||||||
|
| |||||||||||
639 | ||||||||||||
|
| |||||||||||
ENERGY 1.2% | ||||||||||||
Schlumberger Ltd. | 2,702 | 189 | ||||||||||
|
| |||||||||||
FINANCIALS 1.7% | ||||||||||||
Navient Corp. | 7,511 | 86 | ||||||||||
Prudential Financial, Inc. | 2,354 | 192 | ||||||||||
|
| |||||||||||
278 | ||||||||||||
|
| |||||||||||
HEALTH CARE 4.7% | ||||||||||||
AbbVie, Inc. | 4,987 | 295 | ||||||||||
Merck & Co., Inc. | 3,625 | 191 | ||||||||||
Pfizer, Inc. | 8,937 | 289 | ||||||||||
|
| |||||||||||
775 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 1.1% | ||||||||||||
RR Donnelley & Sons Co. | 12,590 | 185 | ||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 5.9% | ||||||||||||
Cisco Systems, Inc. | 8,873 | 241 | ||||||||||
QUALCOMM, Inc. | 7,845 | 392 | ||||||||||
Symantec Corp. | 7,168 | 151 | ||||||||||
Western Digital Corp. | 3,187 | 191 | ||||||||||
|
| |||||||||||
975 | ||||||||||||
|
| |||||||||||
MATERIALS 1.5% | ||||||||||||
International Paper Co. | 6,307 | 238 | ||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 3.3% | ||||||||||||
AT&T, Inc. | 9,884 | 340 |
SHARES | MARKET VALUE (000S) | |||||||||||
CenturyLink, Inc. | 7,951 | $ | 200 | |||||||||
|
| |||||||||||
540 | ||||||||||||
|
| |||||||||||
UTILITIES 2.3% | ||||||||||||
PG&E Corp. | 7,206 | 383 | ||||||||||
|
| |||||||||||
Total United States | 4,202 | |||||||||||
|
| |||||||||||
Total Common Stocks (Cost $9,655) |
| 8,889 | ||||||||||
|
| |||||||||||
PRINCIPAL AMOUNT (000S) | ||||||||||||
CORPORATE BONDS & NOTES 4.6% | ||||||||||||
BRAZIL 0.4% | ||||||||||||
UTILITIES 0.4% | ||||||||||||
Petrobras Global Finance BV |
| |||||||||||
2.000% due 05/20/2016 | $ | 19 | 19 | |||||||||
2.886% due 03/17/2017 | 19 | 17 | ||||||||||
5.375% due 01/27/2021 | 4 | 3 | ||||||||||
3.500% due 02/06/2017 | 2 | 2 | ||||||||||
3.000% due 01/15/2019 | 2 | 2 | ||||||||||
4.875% due 03/17/2020 | 13 | 10 | ||||||||||
6.850% due 06/05/2115 | 10 | 7 | ||||||||||
6.750% due 01/27/2041 | 10 | 6 | ||||||||||
|
| |||||||||||
66 | ||||||||||||
|
| |||||||||||
Total Brazil | 66 | |||||||||||
|
| |||||||||||
DENMARK 0.2% | ||||||||||||
BANKING & FINANCE 0.2% | ||||||||||||
Nordea Kredit Realkreditaktieselskab |
| |||||||||||
2.000% due 10/01/2047 | DKK | 10 | 1 | |||||||||
Nykredit Realkredit A/S |
| |||||||||||
2.500% due 10/01/2047 | 132 | 18 | ||||||||||
2.000% due 10/01/2047 | 50 | 7 | ||||||||||
Realkredit Danmark A/S |
| |||||||||||
2.500% due 10/01/2047 | 49 | 7 | ||||||||||
|
| |||||||||||
33 | ||||||||||||
|
| |||||||||||
Total Denmark | 33 | |||||||||||
|
| |||||||||||
JERSEY, CHANNEL ISLANDS 0.0% | ||||||||||||
BANKING & FINANCE 0.0% | ||||||||||||
UBS Group Funding Jersey Ltd. |
| |||||||||||
2.950% due 09/24/2020 | $ | 2 | 2 | |||||||||
4.125% due 09/24/2025 | 2 | 2 | ||||||||||
|
| |||||||||||
4 | ||||||||||||
|
| |||||||||||
Total Jersey, Channel Islands |
| 4 | ||||||||||
|
| |||||||||||
LUXEMBOURG 0.1% | ||||||||||||
INDUSTRIALS 0.1% | ||||||||||||
Actavis Funding SCS |
| |||||||||||
3.800% due 03/15/2025 | 6 | 6 | ||||||||||
|
| |||||||||||
Total Luxembourg | 6 | |||||||||||
|
| |||||||||||
NETHERLANDS 0.6% | ||||||||||||
BANKING & FINANCE 0.6% | ||||||||||||
Rabobank Group |
| |||||||||||
8.375% due 07/26/2016 (c) | 100 | 103 | ||||||||||
|
| |||||||||||
Total Netherlands | 103 | |||||||||||
|
| |||||||||||
PRINCIPAL AMOUNT (000S) | MARKET VALUE (000S) | |||||||||||
PORTUGAL 0.0% | ||||||||||||
BANKING & FINANCE 0.0% | ||||||||||||
Novo Banco S.A. |
| |||||||||||
5.000% due 04/23/2019 | EUR | 5 | $ | 5 | ||||||||
|
| |||||||||||
Total Portugal | 5 | |||||||||||
|
| |||||||||||
UNITED KINGDOM 0.1% | ||||||||||||
INDUSTRIALS 0.1% | ||||||||||||
Unique Pub Finance Co. PLC |
| |||||||||||
5.659% due 06/30/2027 | GBP | 12 | 18 | |||||||||
|
| |||||||||||
Total United Kingdom | 18 | |||||||||||
|
| |||||||||||
UNITED STATES 3.2% | ||||||||||||
BANKING & FINANCE 1.2% | ||||||||||||
Ally Financial, Inc. |
| |||||||||||
6.250% due 12/01/2017 | $ | 40 | 42 | |||||||||
3.600% due 05/21/2018 | 20 | 20 | ||||||||||
5.500% due 02/15/2017 | 10 | 10 | ||||||||||
Bank of America Corp. |
| |||||||||||
3.875% due 08/01/2025 | 10 | 10 | ||||||||||
CIT Group, Inc. |
| |||||||||||
5.000% due 05/15/2017 | 15 | 16 | ||||||||||
General Motors Financial Co., Inc. |
| |||||||||||
2.750% due 05/15/2016 | 13 | 13 | ||||||||||
Navient Corp. |
| |||||||||||
5.625% due 08/01/2033 | 47 | 32 | ||||||||||
OneMain Financial Holdings, Inc. |
| |||||||||||
7.250% due 12/15/2021 | 32 | 32 | ||||||||||
Santander Holdings USA, Inc. |
| |||||||||||
4.500% due 07/17/2025 | 17 | 17 | ||||||||||
|
| |||||||||||
192 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 1.7% | ||||||||||||
AbbVie, Inc. |
| |||||||||||
3.600% due 05/14/2025 | 22 | 22 | ||||||||||
Amgen, Inc. |
| |||||||||||
3.875% due 11/15/2021 | 2 | 2 | ||||||||||
3.125% due 05/01/2025 | 4 | 4 | ||||||||||
Boxer Parent Co., Inc. (9.000% Cash or 9.750% PIK) |
| |||||||||||
9.000% due 10/15/2019 (a) | 10 | 6 | ||||||||||
Caesars Entertainment Operating Co., Inc. |
| |||||||||||
8.500% due 02/15/2020 ^(d) | 4 | 3 | ||||||||||
9.000% due 02/15/2020 ^(d) | 14 | 11 | ||||||||||
11.250% due 06/01/2017 ^(d) | 70 | 53 | ||||||||||
California Resources Corp. |
| |||||||||||
5.000% due 01/15/2020 | 3 | 1 | ||||||||||
5.500% due 09/15/2021 | 2 | 1 | ||||||||||
8.000% due 12/15/2022 | 9 | 5 | ||||||||||
CCO Safari LLC |
| |||||||||||
3.579% due 07/23/2020 | 2 | 2 | ||||||||||
4.464% due 07/23/2022 | 3 | 3 | ||||||||||
4.908% due 07/23/2025 | 4 | 4 | ||||||||||
6.384% due 10/23/2035 | 2 | 2 | ||||||||||
CVS Health Corp. |
| |||||||||||
3.875% due 07/20/2025 | 2 | 2 | ||||||||||
DISH DBS Corp. |
| |||||||||||
7.125% due 02/01/2016 | 15 | 15 | ||||||||||
iHeartCommunications, Inc. |
| |||||||||||
9.000% due 03/01/2021 | 22 | 15 | ||||||||||
Intrepid Aviation Group Holdings LLC |
| |||||||||||
6.875% due 02/15/2019 | 40 | 33 | ||||||||||
Kraft Heinz Foods Co. |
| |||||||||||
3.950% due 07/15/2025 | 12 | 12 |
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 33 |
Table of Contents
Schedule of Investments PIMCO Balanced Income Fund (Cont.)
PRINCIPAL AMOUNT (000S) | MARKET VALUE (000S) | |||||||||||
Spanish Broadcasting System, Inc. |
| |||||||||||
12.500% due 04/15/2017 | $ | 27 | $ | 27 | ||||||||
Thermo Fisher Scientific, Inc. |
| |||||||||||
3.300% due 02/15/2022 | 2 | 2 | ||||||||||
Times Square Hotel Trust |
| |||||||||||
8.528% due 08/01/2026 | 14 | 16 | ||||||||||
Westmoreland Coal Co. |
| |||||||||||
8.750% due 01/01/2022 | 38 | 24 | ||||||||||
Wynn Las Vegas LLC |
| |||||||||||
5.500% due 03/01/2025 | 16 | 14 | ||||||||||
Zimmer Biomet Holdings, Inc. |
| |||||||||||
3.550% due 04/01/2025 | 7 | 7 | ||||||||||
|
| |||||||||||
286 | ||||||||||||
|
| |||||||||||
UTILITIES 0.3% | ||||||||||||
AT&T, Inc. |
| |||||||||||
3.875% due 08/15/2021 | 2 | 2 | ||||||||||
3.000% due 06/30/2022 | 2 | 2 | ||||||||||
Illinois Power Generating Co. |
| |||||||||||
6.300% due 04/01/2020 | 30 | 18 | ||||||||||
Sprint Communications, Inc. |
| |||||||||||
9.125% due 03/01/2017 | 15 | 15 | ||||||||||
Verizon Communications, Inc. |
| |||||||||||
4.600% due 04/01/2021 | 2 | 2 | ||||||||||
5.150% due 09/15/2023 | 4 | 5 | ||||||||||
|
| |||||||||||
44 | ||||||||||||
|
| |||||||||||
Total United States |
| 522 | ||||||||||
|
| |||||||||||
Total Corporate Bonds & Notes (Cost $833) | 757 | |||||||||||
|
| |||||||||||
NON-AGENCY MORTGAGE-BACKED SECURITIES 4.8% | ||||||||||||
UNITED KINGDOM 0.1% | ||||||||||||
Indus Eclipse PLC |
| |||||||||||
0.829% due 01/25/2020 | GBP | 12 | 17 | |||||||||
|
| |||||||||||
Total United Kingdom | 17 | |||||||||||
|
| |||||||||||
UNITED STATES 4.7% | ||||||||||||
American Home Mortgage Assets Trust |
| |||||||||||
1.197% due 10/25/2046 | $ | 100 | 71 | |||||||||
BAMLL Re-REMIC Trust |
| |||||||||||
5.383% due 11/15/2016 | 21 | 21 | ||||||||||
BCAP LLC Trust |
| |||||||||||
2.596% due 10/26/2035 | 49 | 49 | ||||||||||
2.897% due 07/26/2036 | 61 | 61 | ||||||||||
Countrywide Alternative Loan Trust |
| |||||||||||
0.743% due 11/20/2035 | 281 | 229 | ||||||||||
Countrywide Home Loan Mortgage Pass-Through Trust |
| |||||||||||
5.750% due 12/25/2035 ^ | 64 | 60 | ||||||||||
Credit Suisse Mortgage Capital Certificates |
| |||||||||||
0.551% due 12/27/2035 | 50 | 46 |
PRINCIPAL AMOUNT (000S) | MARKET VALUE (000S) | |||||||||||
GSR Mortgage Loan Trust |
| |||||||||||
2.852% due 03/25/2037 ^ | $ | 44 | $ | 39 | ||||||||
HarborView Mortgage Loan Trust |
| |||||||||||
0.642% due 12/19/2036 ^ | 47 | 33 | ||||||||||
IndyMac Mortgage Loan Trust |
| |||||||||||
0.632% due 07/25/2036 | 57 | 46 | ||||||||||
Lehman XS Trust |
| |||||||||||
0.692% due 02/25/2036 | 45 | 36 | ||||||||||
Morgan Stanley Dean Witter Capital, Inc. Trust |
| |||||||||||
7.490% due 07/15/2033 | 26 | 29 | ||||||||||
Nationslink Funding Corp. Commercial Loan Pass-Through Certificates |
| |||||||||||
6.450% due 01/22/2026 | 28 | 30 | ||||||||||
Washington Mutual Mortgage Pass-Through Certificates Trust |
| |||||||||||
4.530% due 09/25/2036 ^ | 53 | 29 | ||||||||||
|
| |||||||||||
Total United States | 779 | |||||||||||
|
| |||||||||||
Total Non-Agency Mortgage-Backed Securities (Cost $803) | 796 | |||||||||||
|
| |||||||||||
SHARES | ||||||||||||
REAL ESTATE INVESTMENT TRUSTS 2.8% | ||||||||||||
UNITED STATES 2.8% | ||||||||||||
FINANCIALS 2.8% | ||||||||||||
Colony Capital, Inc. ‘A’ | 16,755 | 326 | ||||||||||
Outfront Media, Inc. | 6,502 | 142 | ||||||||||
|
| |||||||||||
468 | ||||||||||||
|
| |||||||||||
Total Real Estate Investment Trusts (Cost $570) | 468 | |||||||||||
|
| |||||||||||
PRINCIPAL AMOUNT (000S) | ||||||||||||
SOVEREIGN ISSUES 1.5% | ||||||||||||
BRAZIL 1.2% | ||||||||||||
Brazil Notas do Tesouro Nacional |
| |||||||||||
6.000% due 08/15/2050 | BRL | 136 | 29 | |||||||||
10.000% due 01/01/2025 | 645 | 117 | ||||||||||
Brazil Notas do Tesouro Nacional Inflation Linked Bond |
| |||||||||||
6.000% due 05/15/2045 | 211 | 45 | ||||||||||
|
| |||||||||||
Total Brazil | 191 | |||||||||||
|
| |||||||||||
GREECE 0.3% | ||||||||||||
Republic of Greece Government International Bond |
| |||||||||||
3.000% due 02/24/2027 | EUR | 10 | 8 | |||||||||
3.000% due 02/24/2029 | 1 | 1 | ||||||||||
3.000% due 02/24/2030 | 1 | 1 | ||||||||||
3.000% due 02/24/2031 | 1 | 1 | ||||||||||
3.000% due 02/24/2032 | 1 | 0 | ||||||||||
3.000% due 02/24/2033 | 1 | 0 |
PRINCIPAL AMOUNT (000S) | MARKET VALUE (000S) | |||||||||||
3.000% due 02/24/2034 | EUR | 5 | $ | 3 | ||||||||
3.000% due 02/24/2035 | 1 | 0 | ||||||||||
3.000% due 02/24/2036 | 2 | 1 | ||||||||||
3.000% due 02/24/2037 | 2 | 1 | ||||||||||
3.000% due 02/24/2038 | 2 | 1 | ||||||||||
3.000% due 02/24/2039 | 2 | 1 | ||||||||||
3.000% due 02/24/2040 | 2 | 1 | ||||||||||
3.000% due 02/24/2041 | 2 | 1 | ||||||||||
3.000% due 02/24/2042 | 2 | 1 | ||||||||||
3.800% due 08/08/2017 | JPY | 1,000 | 8 | |||||||||
4.750% due 04/17/2019 | EUR | 20 | 20 | |||||||||
|
| |||||||||||
Total Greece | 49 | |||||||||||
|
| |||||||||||
Total Sovereign Issues (Cost $381) |
| 240 | ||||||||||
|
| |||||||||||
U.S. TREASURY OBLIGATIONS 4.2% | ||||||||||||
UNITED STATES 4.2% | ||||||||||||
U.S. Treasury Bonds |
| |||||||||||
2.125% due 05/15/2025 | $ | 465 | 459 | |||||||||
U.S. Treasury Notes |
| |||||||||||
2.250% due 11/15/2025 | 230 | 229 | ||||||||||
|
| |||||||||||
Total U.S. Treasury Obligations (Cost $691) | 688 | |||||||||||
|
| |||||||||||
Total Investments in Securities (Cost $14,944) | 13,833 | |||||||||||
|
| |||||||||||
SHARES | ||||||||||||
INVESTMENTS IN AFFILIATES 10.8% | ||||||||||||
SHORT-TERM INSTRUMENTS 10.8% | ||||||||||||
CENTRAL FUNDS USED FOR CASH MANAGEMENT PURPOSES 10.8% | ||||||||||||
PIMCO Short-Term Floating NAV Portfolio III | 180,084 | 1,778 | ||||||||||
|
| |||||||||||
Total Short-Term Instruments (Cost $1,783) | 1,778 | |||||||||||
|
| |||||||||||
Total Investments in Affiliates (Cost $1,783) | 1,778 | |||||||||||
Total Investments 94.9% (Cost $16,727) | $ | 15,611 | ||||||||||
Financial Derivative (Cost or Premiums, net $(123)) | (124 | ) | ||||||||||
Other Assets and Liabilities, net 5.9% | 957 | |||||||||||
|
| |||||||||||
Net Assets 100.0% | $ | �� | 16,444 | |||||||||
|
|
NOTES TO SCHEDULE OF INVESTMENTS (AMOUNTS IN THOUSANDS*, EXCEPT NUMBER OF CONTRACTS):
* | A zero balance may reflect actual amounts rounding to less than one thousand. |
^ | Security is in default. |
(a) | Payment in-kind bond security. |
(b) | Security did not produce income within the last twelve months. |
(c) | Perpetual maturity; date shown, if applicable, represents next contractual call date. |
(d) | Security is subject to a forbearance agreement entered into by the Fund which forbears the Fund from taking action to, among other things, accelerate and collect payments on the subject note with respect to specified events of default. |
34 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
(e) FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED
FUTURES CONTRACTS:
Description | Type | Expiration Month | # of Contracts | Unrealized Appreciation/ (Depreciation) | Variation Margin | |||||||||||||||||
Asset | Liability | |||||||||||||||||||||
90-Day Eurodollar March Futures | Short | 03/2016 | 4 | $ | 0 | $ | 0 | $ | 0 | |||||||||||||
|
|
|
|
|
| |||||||||||||||||
Total Futures Contracts | $ | 0 | $ | 0 | $ | 0 | ||||||||||||||||
|
|
|
|
|
|
SWAP AGREEMENTS:
CREDIT DEFAULT SWAPS ON CREDIT INDICES - SELL PROTECTION (1)
Index/Tranches | Fixed Receive Rate | Maturity Date | Notional Amount (2) | Market Value (3) | Unrealized Appreciation | Variation Margin | ||||||||||||||||||||||||
Asset | Liability | |||||||||||||||||||||||||||||
CDX.HY-25 5-Year Index | 5.000 | % | 12/20/2020 | $ | 879 | $ | 13 | $ | 15 | $ | 1 | $ | 0 | |||||||||||||||||
|
|
|
|
|
|
|
|
(1) | If the Fund is a seller of protection and a credit event occurs, as defined under the terms of that particular swap agreement, the Fund will either (i) pay to the buyer of protection an amount equal to the notional amount of the swap and take delivery of the referenced obligation or underlying securities comprising the referenced index or (ii) pay a net settlement amount in the form of cash or securities equal to the notional amount of the swap less the recovery value of the referenced obligation or underlying securities comprising the referenced index. |
(2) | The maximum potential amount the Fund could be required to pay as a seller of credit protection or receive as a buyer of credit protection if a credit event occurs as defined under the terms of that particular swap agreement. |
(3) | The prices and resulting values for credit default swap agreements on credit indices serve as an indicator of the current status of the payment/performance risk and represent the likelihood of an expected liability (or profit) for the credit derivative should the notional amount of the swap agreement be closed/sold as of the period end. Increasing market values, in absolute terms when compared to the notional amount of the swap, represent a deterioration of the referenced indices’ credit soundness and a greater likelihood or risk of default or other credit event occurring as defined under the terms of the agreement. |
INTEREST RATE SWAPS
Pay/Receive | Floating Rate Index | Fixed Rate | Maturity | Notional | Market | Unrealized Appreciation/ (Depreciation) | Variation Margin | |||||||||||||||||||||||
Asset | Liability | |||||||||||||||||||||||||||||
Pay | 3-Month USD-LIBOR | 2.750 | % | 06/17/2025 | $ 760 | $ | 39 | $ | 7 | $ | 3 | $ | 0 | |||||||||||||||||
Receive | 3-Month USD-LIBOR | 2.750 | 12/16/2045 | 280 | (6 | ) | (4 | ) | 0 | (3 | ) | |||||||||||||||||||
Pay | 6-Month AUD-BBR-BBSW | 4.750 | 06/18/2024 | AUD 200 | 20 | 6 | 0 | (1 | ) | |||||||||||||||||||||
Pay | 6-Month AUD-BBR-BBSW | 3.500 | 06/17/2025 | 400 | 11 | (1 | ) | 0 | (3 | ) | ||||||||||||||||||||
Pay | 28-Day MXN-TIIE | 5.810 | 05/02/2022 | MXN 100 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||
Pay | 28-Day MXN-TIIE | 5.850 | 05/02/2022 | 400 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||
Pay | 28-Day MXN-TIIE | 5.980 | 08/26/2024 | 300 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||
|
|
|
|
|
|
|
| |||||||||||||||||||||||
$ | 64 | $ | 8 | $ | 3 | $ | (7 | ) | ||||||||||||||||||||||
|
|
|
|
|
|
|
| |||||||||||||||||||||||
Total Swap Agreements | $ | 77 | $ | 23 | $ | 4 | $ | (7 | ) | |||||||||||||||||||||
|
|
|
|
|
|
|
|
FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED SUMMARY
The following is a summary of the market value and variation margin of Exchange-Traded or Centrally Cleared Financial Derivative Instruments as of December 31, 2015:
Cash of $119 has been pledged as collateral for exchange-traded and centrally cleared financial derivative instruments as of December 31, 2015. See Note 7, Principal Risks, in the Notes to Financial Statements for more information regarding master netting arrangements.
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||
Market Value | Variation Margin Asset | Market Value | Variation Margin Liability | |||||||||||||||||||||||||||||||
Purchased Options | Futures | Swap Agreements | Total | Written Options | Futures | Swap Agreements | Total | |||||||||||||||||||||||||||
Total Exchange-Traded or Centrally Cleared | $ | 0 | $ | 0 | $ | 4 | $ | 4 | $ | 0 | $ | 0 | $ | (7) | $ | (7) | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(f) FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER
FORWARD FOREIGN CURRENCY CONTRACTS:
Counterparty | Settlement Month | Currency to be Delivered | Currency to be Received | Unrealized Appreciation/ (Depreciation) | ||||||||||||||||||||||||
Asset | Liability | |||||||||||||||||||||||||||
AZD | 01/2016 | $ | 65 | AUD | 90 | $ | 1 | $ | 0 | |||||||||||||||||||
02/2016 | AUD | 90 | $ | 65 | 0 | (1 | ) | |||||||||||||||||||||
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 35 |
Table of Contents
Schedule of Investments PIMCO Balanced Income Fund (Cont.)
Counterparty | Settlement Month | Currency to be Delivered | Currency to be Received | Unrealized Appreciation/ (Depreciation) | ||||||||||||||||||||||||
Asset | Liability | |||||||||||||||||||||||||||
BOA | 01/2016 | BRL | 334 | $ | 85 | $ | 1 | $ | 0 | |||||||||||||||||||
01/2016 | $ | 84 | BRL | 334 | 1 | 0 | ||||||||||||||||||||||
01/2016 | 16 | CAD | 22 | 0 | 0 | |||||||||||||||||||||||
02/2016 | BRL | 334 | $ | 83 | 0 | (1 | ) | |||||||||||||||||||||
03/2016 | $ | 21 | RUB | 1,521 | 0 | (1 | ) | |||||||||||||||||||||
BPS | 01/2016 | BRL | 79 | $ | 20 | 0 | 0 | |||||||||||||||||||||
01/2016 | $ | 20 | BRL | 79 | 0 | 0 | ||||||||||||||||||||||
CBK | 01/2016 | 764 | GBP | 515 | 0 | (5 | ) | |||||||||||||||||||||
02/2016 | GBP | 515 | $ | 764 | 5 | 0 | ||||||||||||||||||||||
02/2016 | $ | 6 | EUR | 5 | 0 | 0 | ||||||||||||||||||||||
DUB | 01/2016 | BRL | 1,255 | $ | 331 | 13 | 0 | |||||||||||||||||||||
01/2016 | $ | 320 | BRL | 1,255 | 0 | (3 | ) | |||||||||||||||||||||
02/2016 | BRL | 1,098 | $ | 278 | 3 | 0 | ||||||||||||||||||||||
FBF | 03/2016 | $ | 4 | RUB | 305 | 0 | 0 | |||||||||||||||||||||
GLM | 01/2016 | JPY | 15,524 | $ | 127 | 0 | (2 | ) | ||||||||||||||||||||
03/2016 | $ | 20 | RUB | 1,385 | 0 | (1 | ) | |||||||||||||||||||||
04/2016 | BRL | 24 | $ | 7 | 1 | 0 | ||||||||||||||||||||||
HUS | 01/2016 | EUR | 509 | 543 | 0 | (11 | ) | |||||||||||||||||||||
02/2016 | $ | 92 | EUR | 84 | 0 | 0 | ||||||||||||||||||||||
JPM | 02/2016 | AUD | 14 | $ | 10 | 0 | 0 | |||||||||||||||||||||
02/2016 | DKK | 235 | 34 | 0 | 0 | |||||||||||||||||||||||
02/2016 | EUR | 299 | 322 | 0 | (4 | ) | ||||||||||||||||||||||
02/2016 | GBP | 24 | 36 | 1 | 0 | |||||||||||||||||||||||
02/2016 | JPY | 13,047 | 106 | 0 | (3 | ) | ||||||||||||||||||||||
02/2016 | $ | 38 | BRL | 153 | 1 | 0 | ||||||||||||||||||||||
MSB | 01/2016 | GBP | 515 | $ | 777 | 17 | 0 | |||||||||||||||||||||
01/2016 | $ | 126 | JPY | 15,283 | 1 | 0 | ||||||||||||||||||||||
02/2016 | EUR | 1 | $ | 1 | 0 | 0 | ||||||||||||||||||||||
02/2016 | JPY | 15,283 | 126 | 0 | (1 | ) | ||||||||||||||||||||||
04/2016 | BRL | 24 | 7 | 1 | 0 | |||||||||||||||||||||||
05/2016 | ZAR | 180 | 12 | 1 | 0 | |||||||||||||||||||||||
NAB | 01/2016 | AUD | 90 | 65 | 0 | (1 | ) | |||||||||||||||||||||
SCX | 01/2016 | $ | 2 | JPY | 241 | 0 | 0 | |||||||||||||||||||||
02/2016 | JPY | 246 | $ | 2 | 0 | 0 | ||||||||||||||||||||||
02/2016 | $ | 5 | AUD | 7 | 0 | 0 | ||||||||||||||||||||||
UAG | 01/2016 | 557 | EUR | 510 | 0 | (3 | ) | |||||||||||||||||||||
02/2016 | EUR | 510 | $ | 557 | 3 | 0 | ||||||||||||||||||||||
|
|
|
| |||||||||||||||||||||||||
Total Forward Foreign Currency Contracts |
| $ | 50 | $ | (37 | ) | ||||||||||||||||||||||
|
|
|
|
WRITTEN OPTIONS:
FOREIGN CURRENCY OPTIONS
Counterparty | Description | Strike Price | Expiration Date | Notional Amount | Premiums (Received) | Market Value | ||||||||||||||||||||
DUB | Put - OTC BRL versus JPY | JPY | 30.000 | 09/22/2016 | BRL 10 | $ | 0 | $ | 0 | |||||||||||||||||
GLM | Call - OTC USD versus BRL | BRL | 3.905 | 03/31/2016 | $ 40 | (1 | ) | (3 | ) | |||||||||||||||||
�� | ||||||||||||||||||||||||||
JPM | Put - OTC BRL versus JPY | JPY | 30.000 | 09/22/2016 | BRL 30 | (1 | ) | (1 | ) | |||||||||||||||||
MSB | Put - OTC BRL versus JPY | 30.000 | 09/22/2016 | 20 | 0 | (1 | ) | |||||||||||||||||||
Call - OTC USD versus BRL | BRL | 3.950 | 04/14/2016 | $ 40 | (1 | ) | (2 | ) | ||||||||||||||||||
|
|
|
| |||||||||||||||||||||||
$ | (3 | ) | $ | (7 | ) | |||||||||||||||||||||
|
|
|
| |||||||||||||||||||||||
Total Written Options |
| $ | (3 | ) | $ | (7 | ) | |||||||||||||||||||
|
|
|
|
TRANSACTIONS IN WRITTEN CALL AND PUT OPTIONS FOR THE PERIOD ENDED DECEMBER 31, 2015
Notional Amount in $ | Notional Amount in BRL | Premiums | ||||||||||
Balance at Beginning of Period | $ | 80 | BRL 60 | $ | (3 | ) | ||||||
Sales | 0 | 0 | 0 | |||||||||
Closing Buys | 0 | 0 | 0 | |||||||||
Expirations | 0 | 0 | 0 | |||||||||
Exercised | 0 | 0 | 0 | |||||||||
|
|
|
|
|
| |||||||
Balance at End of Period | $ | 80 | BRL 60 | $ | (3 | ) | ||||||
|
|
|
|
|
|
36 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
SWAP AGREEMENTS:
CREDIT DEFAULT SWAPS ON CORPORATE AND SOVEREIGN ISSUES - SELL PROTECTION (1)
Counterparty | Reference Entity | Fixed Receive Rate | Maturity Date | Implied Credit Spread at December 31, 2015 (2) | Notional Amount (3) | Premiums Paid/(Received) | Unrealized Appreciation/ (Depreciation) | Swap Agreements, at Value | ||||||||||||||||||||||||||
Asset | Liability | |||||||||||||||||||||||||||||||||
BOA | Russia Government International Bond | 1.000 | % | 12/20/2020 | 3.062 | % | $ 10 | $ | (1 | ) | $ | 0 | $ | 0 | $ | (1 | ) | |||||||||||||||||
BPS | Petrobras International Finance Co. | 1.000 | 12/20/2019 | 9.956 | 1 | 0 | 0 | 0 | 0 | |||||||||||||||||||||||||
BRC | Petrobras International Finance Co. | 1.000 | 12/20/2019 | 9.956 | 2 | 0 | (1 | ) | 0 | (1 | ) | |||||||||||||||||||||||
GST | Gazprom OAO Via Gaz Capital S.A. | 1.000 | 06/20/2020 | 3.727 | 100 | (13 | ) | 2 | 0 | (11 | ) | |||||||||||||||||||||||
Russia Government International Bond | 1.000 | 06/20/2020 | 2.937 | 75 | (9 | ) | 3 | 0 | (6 | ) | ||||||||||||||||||||||||
HUS | Petrobras International Finance Co. | 1.000 | 12/20/2019 | 9.956 | 23 | (2 | ) | (4 | ) | 0 | (6 | ) | ||||||||||||||||||||||
Russia Government International Bond | 1.000 | 06/20/2019 | 2.658 | 50 | (2 | ) | 0 | 0 | (2 | ) | ||||||||||||||||||||||||
Russia Government International Bond | 1.000 | 06/20/2024 | 3.393 | 50 | (5 | ) | (3 | ) | 0 | (8 | ) | |||||||||||||||||||||||
Russia Government International Bond | 1.000 | 09/20/2024 | 3.403 | 5 | (1 | ) | 0 | 0 | (1 | ) | ||||||||||||||||||||||||
JPM | Gazprom OAO Via Gaz Capital S.A. | 1.000 | 03/20/2016 | 2.332 | 90 | (8 | ) | 8 | 0 | 0 | ||||||||||||||||||||||||
Petrobras International Finance Co. | 1.000 | 12/20/2019 | 9.956 | 32 | (3 | ) | (6 | ) | 0 | (9 | ) | |||||||||||||||||||||||
|
|
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|
| |||||||||||||||||||||||||||
$ | (44 | ) | $ | (1 | ) | $ | 0 | $ | (45 | ) | ||||||||||||||||||||||||
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CREDIT DEFAULT SWAPS ON CREDIT INDICES - SELL PROTECTION (1)
Counterparty | Index/Tranches | Fixed Receive Rate | Maturity Date | Notional Amount (3) | Premiums (Received) | Unrealized Appreciation/ (Depreciation) | Swap Agreements, at Value (4) | |||||||||||||||||||||||
Asset | Liability | |||||||||||||||||||||||||||||
BOA | ABX.HE.AAA.6-2 Index | 0.110 | % | 05/25/2046 | $ | 121 | $ (24 | ) | $ | 1 | $ | 0 | $ | (23 | ) | |||||||||||||||
FBF | CMBX.NA.AAA.6 Index | 0.500 | 05/11/2063 | 100 | (2 | ) | 0 | 0 | (2 | ) | ||||||||||||||||||||
CMBX.NA.AAA.7 Index | 0.500 | 01/17/2047 | 100 | (2 | ) | (2 | ) | 0 | (4 | ) | ||||||||||||||||||||
GST | CMBX.NA.AAA.6 Index | 0.500 | 05/11/2063 | 200 | (5 | ) | 0 | 0 | (5 | ) | ||||||||||||||||||||
CMBX.NA.AAA.7 Index | 0.500 | 01/17/2047 | 200 | (7 | ) | 0 | 0 | (7 | ) | |||||||||||||||||||||
MYC | ABX.HE.AAA.6-2 Index | 0.110 | 05/25/2046 | 194 | (38 | ) | 1 | 0 | (37 | ) | ||||||||||||||||||||
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| |||||||||||||||||||||||
$ (78 | ) | $ | 0 | $ | 0 | $ | (78 | ) | ||||||||||||||||||||||
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(1) | If the Fund is a seller of protection and a credit event occurs, as defined under the terms of that particular swap agreement, the Fund will either (i) pay to the buyer of protection an amount equal to the notional amount of the swap and take delivery of the referenced obligation or underlying securities comprising the referenced index or (ii) pay a net settlement amount in the form of cash or securities equal to the notional amount of the swap less the recovery value of the referenced obligation or underlying securities comprising the referenced index. |
(2) | Implied credit spreads, represented in absolute terms, utilized in determining the market value of credit default swap agreements on corporate or sovereign issues as of period end serve as an indicator of the current status of the payment/performance risk and represent the likelihood or risk of default for the credit derivative. The implied credit spread of a particular referenced entity reflects the cost of buying/selling protection and may include upfront payments required to be made to enter into the agreement. Wider credit spreads represent a deterioration of the referenced entity’s credit soundness and a greater likelihood or risk of default or other credit event occurring as defined under the terms of the agreement. |
(3) | The maximum potential amount the Fund could be required to pay as a seller of credit protection or receive as a buyer of credit protection if a credit event occurs as defined under the terms of that particular swap agreement. |
(4) | The prices and resulting values for credit default swap agreements on credit indices serve as an indicator of the current status of the payment/performance risk and represent the likelihood of an expected liability (or profit) for the credit derivative should the notional amount of the swap agreement be closed/sold as of the period end. Increasing market values, in absolute terms when compared to the notional amount of the swap, represent a deterioration of the referenced indices’ credit soundness and a greater likelihood or risk of default or other credit event occurring as defined under the terms of the agreement. |
INTEREST RATE SWAPS
Counterparty | Pay/Receive Floating Rate | Floating Rate Index | Fixed Rate | Maturity Date | Notional Amount | Premiums Paid/(Received) | Unrealized Appreciation/ (Depreciation) | Swap Agreements, at Value | ||||||||||||||||||||||||||
Asset | Liability | |||||||||||||||||||||||||||||||||
BPS | Pay | 1-Year BRL-CDI | 12.000 | % | 01/04/2021 | BRL | 100 | $ | 0 | $ | (3 | ) | $ | 0 | $ | (3 | ) | |||||||||||||||||
DUB | Pay | 1-Year BRL-CDI | 12.810 | 01/04/2021 | 30 | 0 | (1 | ) | 0 | (1 | ) | |||||||||||||||||||||||
FBF | Pay | 1-Year BRL-CDI | 12.810 | 01/04/2021 | 40 | 0 | (1 | ) | 0 | (1 | ) | |||||||||||||||||||||||
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 37 |
Table of Contents
Schedule of Investments PIMCO Balanced Income Fund (Cont.)
Counterparty | Pay/Receive Floating Rate | Floating Rate Index | Fixed Rate | Maturity Date | Notional Amount | Premiums Paid/(Received) | Unrealized Appreciation/ (Depreciation) | Swap Agreements, at Value | ||||||||||||||||||||||||||
Asset | Liability | |||||||||||||||||||||||||||||||||
GLM | Pay | 1-Year BRL-CDI | 16.400 | % | 01/04/2021 | BRL | 40 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | |||||||||||||||||||
Pay | 3-Month USD-LIBOR | 2.350 | 02/18/2021 | $ | 200 | 1 | 2 | 3 | 0 | |||||||||||||||||||||||||
Pay | 3-Month USD-LIBOR | 2.550 | 02/18/2026 | 100 | 0 | 1 | 1 | 0 | ||||||||||||||||||||||||||
JPM | Pay | 3-Month USD-LIBOR | 2.350 | 02/18/2021 | 100 | 1 | 0 | 1 | 0 | |||||||||||||||||||||||||
MYC | Pay | 1-Year BRL-CDI | 12.230 | 01/04/2021 | BRL | 100 | 0 | (3 | ) | 0 | (3 | ) | ||||||||||||||||||||||
Pay | 1-Year BRL-CDI | 12.810 | 01/04/2021 | 40 | 0 | (1 | ) | 0 | (1 | ) | ||||||||||||||||||||||||
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$ | 2 | $ | (6 | ) | $ | 5 | $ | (9 | ) | |||||||||||||||||||||||||
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| |||||||||||||||||||||||||||
Total Swap Agreements | $ | (120 | ) | $ | (7 | ) | $ | 5 | $ | (132 | ) | |||||||||||||||||||||||
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FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER SUMMARY
The following is a summary by counterparty of the market value of OTC financial derivative instruments and collateral (received)/pledged as of December 31, 2015:
Counterparty | Financial Derivative Assets | Financial Derivative Liabilities | ||||||||||||||||||||||||||||||||||||||||||||
Forward Foreign Currency Contracts | Purchased Options | Swap Agreements | Total Over the Counter | Forward Foreign Currency Contracts | Written Options | Swap Agreements | Total Over the Counter | Net Market Value of OTC Derivatives | Collateral (Received)/ Pledged | Net Exposure (5) | ||||||||||||||||||||||||||||||||||||
AZD | $ | 1 | $ | 0 | $ | 0 | $ | 1 | $ | (1 | ) | $ | 0 | $ | 0 | $ | (1 | ) | $ | 0 | $ | 0 | $ | 0 | ||||||||||||||||||||||
BOA | 2 | 0 | 0 | 2 | (2 | ) | 0 | (24 | ) | (26 | ) | (24 | ) | 0 | (24 | ) | ||||||||||||||||||||||||||||||
BPS | 0 | 0 | 0 | 0 | 0 | 0 | (3 | ) | (3 | ) | (3 | ) | 0 | (3 | ) | |||||||||||||||||||||||||||||||
BRC | 0 | 0 | 0 | 0 | 0 | 0 | (1 | ) | (1 | ) | (1 | ) | 0 | (1 | ) | |||||||||||||||||||||||||||||||
CBK | 5 | 0 | 0 | 5 | (5 | ) | 0 | 0 | (5 | ) | 0 | 0 | 0 | |||||||||||||||||||||||||||||||||
DUB | 16 | 0 | 0 | 16 | (3 | ) | 0 | (1 | ) | (4 | ) | 12 | 0 | 12 | ||||||||||||||||||||||||||||||||
FBF | 0 | 0 | 0 | 0 | 0 | 0 | (7 | ) | (7 | ) | (7 | ) | 0 | (7 | ) | |||||||||||||||||||||||||||||||
GLM | 1 | 0 | 4 | 5 | (3 | ) | (3 | ) | 0 | (6 | ) | (1 | ) | 0 | (1 | ) | ||||||||||||||||||||||||||||||
GST | 0 | 0 | 0 | 0 | 0 | 0 | (29 | ) | (29 | ) | (29 | ) | 0 | (29 | ) | |||||||||||||||||||||||||||||||
HUS | 0 | 0 | 0 | 0 | (11 | ) | 0 | (17 | ) | (28 | ) | (28 | ) | 0 | (28 | ) | ||||||||||||||||||||||||||||||
JPM | 2 | 0 | 1 | 3 | (7 | ) | (1 | ) | (9 | ) | (17 | ) | (14 | ) | 0 | (14 | ) | |||||||||||||||||||||||||||||
MSB | 20 | 0 | 0 | 20 | (1 | ) | (3 | ) | 0 | (4 | ) | 16 | 0 | 16 | ||||||||||||||||||||||||||||||||
MYC | 0 | 0 | 0 | 0 | 0 | 0 | (41 | ) | (41 | ) | (41 | ) | 0 | (41 | ) | |||||||||||||||||||||||||||||||
NAB | 0 | 0 | 0 | 0 | (1 | ) | 0 | 0 | (1 | ) | (1 | ) | 0 | (1 | ) | |||||||||||||||||||||||||||||||
UAG | 3 | 0 | 0 | 3 | (3 | ) | 0 | 0 | (3 | ) | 0 | 0 | 0 | |||||||||||||||||||||||||||||||||
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| |||||||||||||||||||||||||||||||
Total Over the Counter | $ | 50 | $ | 0 | $ | 5 | $ | 55 | $ | (37 | ) | $ | (7 | ) | $ | (132 | ) | $ | (176 | ) | ||||||||||||||||||||||||||
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(5) | Net Exposure represents the net receivable/(payable) that would be due from/to the counterparty in the event of default. Exposure from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same legal entity. See Note 7, Principal Risks, in the Notes to Financial Statements for more information regarding master netting arrangements. |
FAIR VALUE OF FINANCIAL DERIVATIVE INSTRUMENTS
The following is a summary of the fair valuation of the Fund’s derivative instruments categorized by risk exposure. See Note 7, Principal Risks, in the Notes to Financial Statements on risks of the Fund.
Fair Values of Financial Derivative Instruments on the Statements of Assets and Liabilities as of December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
�� | Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | ||||||||||||||||||
Financial Derivative Instruments - Assets |
| |||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Swap Agreements | $ | 0 | $ | 1 | $ | 0 | $ | 0 | $ | 3 | $ | 4 | ||||||||||||
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| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | 50 | $ | 0 | $ | 50 | ||||||||||||
Swap Agreements | 0 | 0 | 0 | 0 | 5 | 5 | ||||||||||||||||||
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| |||||||||||||
$ | 0 | $ | 0 | $ | 0 | $ | 50 | $ | 5 | $ | 55 | |||||||||||||
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| |||||||||||||
$ | 0 | $ | 1 | $ | 0 | $ | 50 | $ | 8 | $ | 59 | |||||||||||||
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| |||||||||||||
Financial Derivative Instruments - Liabilities |
| |||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Swap Agreements | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 7 | $ | 7 | ||||||||||||
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| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | 37 | $ | 0 | $ | 37 | ||||||||||||
Written Options | 0 | 0 | 0 | 7 | 0 | 7 | ||||||||||||||||||
Swap Agreements | 0 | 123 | 0 | 0 | 9 | 132 | ||||||||||||||||||
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| |||||||||||||
$ | 0 | $ | 123 | $ | 0 | $ | 44 | $ | 9 | $ | 176 | |||||||||||||
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| |||||||||||||
$ | 0 | $ | 123 | $ | 0 | $ | 44 | $ | 16 | $ | 183 | |||||||||||||
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38 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
The effect of Financial Derivative Instruments on the Statements of Operations for the period ended December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Net Realized Gain (Loss) on Financial Derivative Instruments |
| |||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Futures | $ | 0 | $ | 0 | $ | 15 | $ | 0 | $ | 0 | $ | 15 | ||||||||||||
Swap Agreements | 0 | (15 | ) | 0 | 0 | 13 | (2 | ) | ||||||||||||||||
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| |||||||||||||
$ | 0 | $ | (15 | ) | $ | 15 | $ | 0 | $ | 13 | $ | 13 | ||||||||||||
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| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | 124 | $ | 0 | $ | 124 | ||||||||||||
Swap Agreements | 0 | 4 | 0 | 0 | 2 | 6 | ||||||||||||||||||
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$ | 0 | $ | 4 | $ | 0 | $ | 124 | $ | 2 | $ | 130 | |||||||||||||
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| |||||||||||||
$ | 0 | $ | (11 | ) | $ | 15 | $ | 124 | $ | 15 | $ | 143 | ||||||||||||
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Net Change in Unrealized Appreciation (Depreciation) on Financial Derivative Instruments |
| |||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Futures | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||||||||
Swap Agreements | 0 | 20 | 0 | 0 | 6 | 26 | ||||||||||||||||||
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| |||||||||||||
$ | 0 | $ | 20 | $ | 0 | $ | 0 | $ | 6 | $ | 26 | |||||||||||||
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| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | 5 | $ | 0 | $ | 5 | ||||||||||||
Written Options | 0 | 0 | 0 | (4 | ) | 0 | (4 | ) | ||||||||||||||||
Swap Agreements | 0 | (7 | ) | 0 | 0 | (8 | ) | (15 | ) | |||||||||||||||
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| |||||||||||||
$ | 0 | $ | (7 | ) | $ | 0 | $ | 1 | $ | (8 | ) | $ | (14 | ) | ||||||||||
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$ | 0 | $ | 13 | $ | 0 | $ | 1 | $ | (2 | ) | $ | 12 | ||||||||||||
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FAIR VALUE MEASUREMENTS
The following is a summary of the fair valuations according to the inputs used as of December 31, 2015 in valuing the Fund’s assets and liabilities:
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at | ||||||||||||
Investments in Securities, at Value | ||||||||||||||||
Asset-Backed Securities | ||||||||||||||||
Cayman Islands | $ | 0 | $ | 163 | $ | 0 | $ | 163 | ||||||||
United States | 0 | 1,508 | 12 | 1,520 | ||||||||||||
Bank Loan Obligations | ||||||||||||||||
United States | 0 | 312 | 0 | 312 | ||||||||||||
Common Stocks | ||||||||||||||||
Australia | ||||||||||||||||
Consumer Discretionary | 0 | 169 | 0 | 169 | ||||||||||||
Health Care | 0 | 146 | 0 | 146 | ||||||||||||
Industrials | 0 | 184 | 0 | 184 | ||||||||||||
Brazil | ||||||||||||||||
Health Care | 0 | 42 | 0 | 42 | ||||||||||||
Industrials | 69 | 0 | 0 | 69 | ||||||||||||
Utilities | 0 | 41 | 0 | 41 | ||||||||||||
Canada | ||||||||||||||||
Utilities | 165 | 0 | 0 | 165 | ||||||||||||
France | ||||||||||||||||
Consumer Staples | 0 | 142 | 0 | 142 | ||||||||||||
Utilities | 0 | 194 | 0 | 194 | ||||||||||||
Germany | ||||||||||||||||
Materials | 95 | 0 | 0 | 95 | ||||||||||||
Greece | ||||||||||||||||
Consumer Discretionary | 0 | 132 | 0 | 132 | ||||||||||||
Hong Kong | ||||||||||||||||
Telecommunication Services | 0 | 292 | 0 | 292 | ||||||||||||
Italy | ||||||||||||||||
Financials | 0 | 267 | 0 | 267 | ||||||||||||
Industrials | 0 | 92 | 0 | 92 | ||||||||||||
Japan | ||||||||||||||||
Consumer Discretionary | 0 | 145 | 0 | 145 | ||||||||||||
Mexico | ||||||||||||||||
Consumer Staples | 44 | 0 | 0 | 44 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at | ||||||||||||
Netherlands | ||||||||||||||||
Financials | $ | 0 | $ | 431 | $ | 0 | $ | 431 | ||||||||
Russia | ||||||||||||||||
Consumer Staples | 42 | 0 | 0 | 42 | ||||||||||||
Spain | ||||||||||||||||
Consumer Staples | 0 | 139 | 0 | 139 | ||||||||||||
Switzerland | ||||||||||||||||
Health Care | 0 | 289 | 0 | 289 | ||||||||||||
Taiwan | ||||||||||||||||
Information Technology | 0 | 191 | 0 | 191 | ||||||||||||
Thailand | ||||||||||||||||
Telecommunication Services | 0 | 38 | 0 | 38 | ||||||||||||
United Kingdom | ||||||||||||||||
Consumer Staples | 0 | 97 | 0 | 97 | ||||||||||||
Energy | 99 | 0 | 0 | 99 | ||||||||||||
Financials | 0 | 768 | 0 | 768 | ||||||||||||
Telecommunication Services | 0 | 374 | 0 | 374 | ||||||||||||
United States | ||||||||||||||||
Consumer Discretionary | 639 | 0 | 0 | 639 | ||||||||||||
Energy | 189 | 0 | 0 | 189 | ||||||||||||
Financials | 278 | 0 | 0 | 278 | ||||||||||||
Health Care | 775 | 0 | 0 | 775 | ||||||||||||
Industrials | 185 | 0 | 0 | 185 | ||||||||||||
Information Technology | 975 | 0 | 0 | 975 | ||||||||||||
Materials | 238 | 0 | 0 | 238 | ||||||||||||
Telecommunication Services | 540 | 0 | 0 | 540 | ||||||||||||
Utilities | 383 | 0 | 0 | 383 | ||||||||||||
Corporate Bonds & Notes | ||||||||||||||||
Brazil | ||||||||||||||||
Utilities | 0 | 66 | 0 | 66 | ||||||||||||
Denmark | ||||||||||||||||
Banking & Finance | 0 | 33 | 0 | 33 | ||||||||||||
Jersey, Channel Islands | ||||||||||||||||
Banking & Finance | 0 | 4 | 0 | 4 |
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 39 |
Table of Contents
Schedule of Investments PIMCO Balanced Income Fund (Cont.)
December 31, 2015 (Unaudited)
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at | ||||||||||||
Luxembourg | ||||||||||||||||
Industrials | $ | 0 | $ | 6 | $ | 0 | $ | 6 | ||||||||
Netherlands | ||||||||||||||||
Banking & Finance | 0 | 103 | 0 | 103 | ||||||||||||
Portugal | ||||||||||||||||
Banking & Finance | 0 | 5 | 0 | 5 | ||||||||||||
United Kingdom | ||||||||||||||||
Industrials | 0 | 18 | 0 | 18 | ||||||||||||
United States | ||||||||||||||||
Banking & Finance | 0 | 192 | 0 | 192 | ||||||||||||
Industrials | 0 | 286 | 0 | 286 | ||||||||||||
Utilities | 0 | 44 | 0 | 44 | ||||||||||||
Non-Agency Mortgage-Backed Securities | ||||||||||||||||
United Kingdom | 0 | 17 | 0 | 17 | ||||||||||||
United States | 0 | 779 | 0 | 779 | ||||||||||||
Real Estate Investment Trusts | ||||||||||||||||
United States | ||||||||||||||||
Financials | 468 | 0 | 0 | 468 | ||||||||||||
Sovereign Issues | ||||||||||||||||
Brazil | 0 | 191 | 0 | 191 | ||||||||||||
Greece | 0 | 49 | 0 | 49 | ||||||||||||
U.S. Treasury Obligations | ||||||||||||||||
United States | 0 | 688 | 0 | 688 | ||||||||||||
$ | 5,184 | $ | 8,637 | $ | 12 | $ | 13,833 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at | ||||||||||||
Investments in Affiliates, at Value | ||||||||||||||||
Short-Term Instruments | ||||||||||||||||
Central Funds Used for Cash Management Purposes | $ | 1,778 | $ | 0 | $ | 0 | $ | 1,778 | ||||||||
Total Investments | $ | 6,962 | $ | 8,637 | $ | 12 | $ | 15,611 | ||||||||
Financial Derivative Instruments - Assets |
| |||||||||||||||
Exchange-traded or centrally cleared | 0 | 4 | 0 | 4 | ||||||||||||
Over the counter | 0 | 55 | 0 | 55 | ||||||||||||
$ | 0 | $ | 59 | $ | 0 | $ | 59 | |||||||||
Financial Derivative Instruments - Liabilities |
| |||||||||||||||
Exchange-traded or centrally cleared | 0 | (7 | ) | 0 | (7 | ) | ||||||||||
Over the counter | 0 | (176 | ) | 0 | (176 | ) | ||||||||||
$ | 0 | $ | (183 | ) | $ | 0 | $ | (183 | ) | |||||||
Totals | $ | 6,962 | $ | 8,513 | $ | 12 | $ | 15,487 |
There were no significant transfers between Levels 1, 2, or 3 during the period ended December 31, 2015.
40 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
Schedule of Investments PIMCO Dividend and Income Builder Fund
December 31, 2015 (Unaudited)
PRINCIPAL AMOUNT (000S) | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN SECURITIES 101.0% | ||||||||||||
ASSET-BACKED SECURITIES 2.1% | ||||||||||||
UNITED STATES 2.1% | ||||||||||||
Credit Suisse First Boston Mortgage Securities Corp. |
| |||||||||||
1.042% due 01/25/2032 | $ | 1,660 | $ | 1,445 | ||||||||
EMC Mortgage Loan Trust |
| |||||||||||
1.521% due 02/25/2041 | 43 | 42 | ||||||||||
HSI Asset Securitization Corp. Trust |
| |||||||||||
0.592% due 12/25/2036 | 5,848 | 2,502 | ||||||||||
JPMorgan Mortgage Acquisition Trust |
| |||||||||||
5.059% due 11/25/2036 | 200 | 202 | ||||||||||
Morgan Stanley Home Equity Loan Trust |
| |||||||||||
0.522% due 12/25/2036 | 190 | 108 | ||||||||||
Residential Asset Securities Corp. Trust |
| |||||||||||
1.307% due 01/25/2034 | 2,406 | 2,168 | ||||||||||
Structured Asset Investment Loan Trust |
| |||||||||||
0.572% due 09/25/2036 | 7,494 | 6,002 | ||||||||||
|
| |||||||||||
Total Asset-Backed Securities | 12,469 | |||||||||||
|
| |||||||||||
BANK LOAN OBLIGATIONS 0.4% | ||||||||||||
BRAZIL 0.0% | ||||||||||||
OGX |
| |||||||||||
TBD% - 13.000% due 04/10/2049 | 15 | 16 | ||||||||||
|
| |||||||||||
UNITED STATES 0.4% | ||||||||||||
Energy Future Intermediate Holding Co. LLC |
| |||||||||||
4.250% due 06/19/2016 | 2,217 | 2,213 | ||||||||||
iHeartCommunications, Inc. |
| |||||||||||
7.174% due 01/30/2019 | 300 | 212 | ||||||||||
|
| |||||||||||
Total Bank Loan Obligations (Cost $2,532) | 2,425 | |||||||||||
|
| |||||||||||
SHARES | ||||||||||||
COMMON STOCKS 88.8% | ||||||||||||
AUSTRALIA 5.2% | ||||||||||||
CONSUMER DISCRETIONARY 1.8% | ||||||||||||
G8 Education Ltd. | 4,217,450 | 10,906 | ||||||||||
|
| |||||||||||
HEALTH CARE 1.4% | ||||||||||||
Sonic Healthcare Ltd. | 669,633 | 8,670 | ||||||||||
|
| |||||||||||
INDUSTRIALS 2.0% | ||||||||||||
Spotless Group Holdings Ltd. | 15,363,269 | 12,038 | ||||||||||
|
| |||||||||||
Total Australia | 31,614 | |||||||||||
|
| |||||||||||
BRAZIL 1.9% | ||||||||||||
ENERGY 0.0% | ||||||||||||
OGX Petroleo e Gas S.A. ADR (b) | 6,334 | 0 | ||||||||||
|
| |||||||||||
HEALTH CARE 0.5% | ||||||||||||
Qualicorp S.A. | 811,499 | 2,886 | ||||||||||
|
| |||||||||||
INDUSTRIALS 1.1% | ||||||||||||
Arteris S.A. | 2,685,400 | 6,550 | ||||||||||
|
| |||||||||||
UTILITIES 0.3% | ||||||||||||
Light S.A. | 749,400 | 1,871 | ||||||||||
|
| |||||||||||
Total Brazil | 11,307 | |||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
CANADA 1.6% | ||||||||||||
UTILITIES 1.6% | ||||||||||||
Capital Power Corp. | 765,277 | $ | 9,828 | |||||||||
|
| |||||||||||
Total Canada | 9,828 | |||||||||||
|
| |||||||||||
FRANCE 3.3% | ||||||||||||
CONSUMER STAPLES 1.4% | ||||||||||||
Carrefour S.A. | 292,211 | 8,433 | ||||||||||
|
| |||||||||||
UTILITIES 1.9% | ||||||||||||
Engie S.A. | 639,354 | 11,325 | ||||||||||
|
| |||||||||||
Total France | 19,758 | |||||||||||
|
| |||||||||||
GERMANY 1.0% | ||||||||||||
MATERIALS 1.0% | ||||||||||||
Covestro AG (b) | 161,582 | 5,906 | ||||||||||
|
| |||||||||||
Total Germany | 5,906 | |||||||||||
|
| |||||||||||
GREECE 1.3% | ||||||||||||
CONSUMER DISCRETIONARY 1.3% | ||||||||||||
OPAP S.A. | 888,397 | 7,796 | ||||||||||
|
| |||||||||||
Total Greece | 7,796 | |||||||||||
|
| |||||||||||
HONG KONG 2.9% | ||||||||||||
TELECOMMUNICATION SERVICES 2.9% | ||||||||||||
China Mobile Ltd. | 1,271,455 | 14,312 | ||||||||||
PCCW Ltd. | 4,990,000 | 2,917 | ||||||||||
|
| |||||||||||
17,229 | ||||||||||||
|
| |||||||||||
Total Hong Kong | 17,229 | |||||||||||
|
| |||||||||||
ITALY 3.9% | ||||||||||||
FINANCIALS 2.8% | ||||||||||||
Intesa Sanpaolo SpA | 5,103,171 | 16,948 | ||||||||||
|
| |||||||||||
INDUSTRIALS 1.1% | ||||||||||||
Societa Iniziative Autostradali e Servizi SpA | 625,887 | 6,651 | ||||||||||
|
| |||||||||||
Total Italy | 23,599 | |||||||||||
|
| |||||||||||
JAPAN 1.4% | ||||||||||||
CONSUMER DISCRETIONARY 1.4% | ||||||||||||
Bridgestone Corp. | 251,865 | 8,639 | ||||||||||
|
| |||||||||||
Total Japan | 8,639 | |||||||||||
|
| |||||||||||
MEXICO 0.5% | ||||||||||||
CONSUMER STAPLES 0.5% | ||||||||||||
Coca-Cola Femsa S.A.B. | 404,007 | 2,890 | ||||||||||
|
| |||||||||||
Total Mexico | 2,890 | |||||||||||
|
| |||||||||||
NETHERLANDS 4.2% | ||||||||||||
FINANCIALS 4.2% | ||||||||||||
Aegon NV | 3,007,193 | 17,007 |
SHARES | MARKET VALUE (000S) | |||||||||||
NN Group NV | 244,626 | $ | 8,631 | |||||||||
|
| |||||||||||
25,638 | ||||||||||||
|
| |||||||||||
Total Netherlands | 25,638 | |||||||||||
|
| |||||||||||
RUSSIA 0.3% | ||||||||||||
CONSUMER STAPLES 0.3% | ||||||||||||
Magnit PJSC SP - GDR | 48,407 | 1,947 | ||||||||||
|
| |||||||||||
Total Russia | 1,947 | |||||||||||
|
| |||||||||||
SPAIN 1.4% | ||||||||||||
CONSUMER STAPLES 1.4% | ||||||||||||
Ebro Foods S.A. | 431,133 | 8,481 | ||||||||||
|
| |||||||||||
Total Spain | 8,481 | |||||||||||
|
| |||||||||||
SWITZERLAND 2.8% | ||||||||||||
HEALTH CARE 2.8% | ||||||||||||
Roche Holding AG | 61,451 | 17,029 | ||||||||||
|
| |||||||||||
Total Switzerland | 17,029 | |||||||||||
|
| |||||||||||
TAIWAN 1.9% | ||||||||||||
INFORMATION TECHNOLOGY 1.9% | ||||||||||||
Taiwan Semiconductor Manufacturing Co. Ltd. | 2,641,564 | 11,396 | ||||||||||
|
| |||||||||||
Total Taiwan | 11,396 | |||||||||||
|
| |||||||||||
THAILAND 0.4% | ||||||||||||
TELECOMMUNICATION SERVICES 0.4% | ||||||||||||
Total Access Communication PCL NVDR | 2,736,758 | 2,286 | ||||||||||
|
| |||||||||||
Total Thailand | 2,286 | |||||||||||
|
| |||||||||||
UNITED KINGDOM 13.2% | ||||||||||||
CONSUMER STAPLES 0.9% | ||||||||||||
Imperial Tobacco Group PLC | 109,324 | 5,774 | ||||||||||
|
| |||||||||||
ENERGY 1.1% | ||||||||||||
Golar LNG Partners LP | 476,992 | 6,382 | ||||||||||
|
| |||||||||||
FINANCIALS 7.5% | ||||||||||||
HSBC Holdings PLC | 2,504,827 | 19,774 | ||||||||||
ICAP PLC | 1,138,331 | 8,544 | ||||||||||
Lloyds Banking Group PLC | 15,811,814 | 17,014 | ||||||||||
|
| |||||||||||
45,332 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 3.7% | ||||||||||||
Vodafone Group PLC | 6,877,822 | 22,303 | ||||||||||
|
| |||||||||||
Total United Kingdom | 79,791 | |||||||||||
|
| |||||||||||
UNITED STATES 41.6% | ||||||||||||
CONSUMER DISCRETIONARY 6.4% | ||||||||||||
Comcast Corp. ‘A’ | 75,664 | 4,270 | ||||||||||
General Motors Co. | 417,174 | 14,188 | ||||||||||
Kohl’s Corp. | 153,021 | 7,288 | ||||||||||
Macy’s, Inc. | 204,364 | 7,149 |
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 41 |
Table of Contents
Schedule of Investments PIMCO Dividend and Income Builder Fund (Cont.)
SHARES | MARKET VALUE (000S) | |||||||||||
SeaWorld Entertainment, Inc. | 289,182 | $ | 5,694 | |||||||||
|
| |||||||||||
38,589 | ||||||||||||
|
| |||||||||||
ENERGY 1.9% | ||||||||||||
Schlumberger Ltd. | 163,296 | 11,390 | ||||||||||
|
| |||||||||||
FINANCIALS 2.8% | ||||||||||||
Navient Corp. | 486,254 | 5,567 | ||||||||||
Prudential Financial, Inc. | 140,054 | 11,402 | ||||||||||
|
| |||||||||||
16,969 | ||||||||||||
|
| |||||||||||
HEALTH CARE 7.6% | ||||||||||||
AbbVie, Inc. | 290,513 | 17,210 | ||||||||||
Merck & Co., Inc. | 215,861 | 11,402 | ||||||||||
Pfizer, Inc. | 531,643 | 17,161 | ||||||||||
|
| |||||||||||
45,773 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 1.9% | ||||||||||||
RR Donnelley & Sons Co. | 774,310 | 11,398 | ||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 9.4% | ||||||||||||
Cisco Systems, Inc. | 527,825 | 14,333 | ||||||||||
QUALCOMM, Inc. | 452,594 | 22,623 | ||||||||||
Symantec Corp. | 404,095 | 8,486 | ||||||||||
Western Digital Corp. | 188,569 | 11,324 | ||||||||||
|
| |||||||||||
56,766 | ||||||||||||
|
| |||||||||||
MATERIALS 2.3% | ||||||||||||
International Paper Co. | 375,177 | 14,144 | ||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 5.5% | ||||||||||||
AT&T, Inc. | 651,384 | 22,414 | ||||||||||
CenturyLink, Inc. | 427,554 | 10,757 | ||||||||||
|
| |||||||||||
33,171 | ||||||||||||
|
| |||||||||||
UTILITIES 3.8% | ||||||||||||
PG&E Corp. | 428,679 | 22,802 | ||||||||||
|
| |||||||||||
Total United States | 251,002 | |||||||||||
|
| |||||||||||
Total Common Stocks (Cost $590,818) | 536,136 | |||||||||||
|
| |||||||||||
PRINCIPAL AMOUNT (000S) | ||||||||||||
CORPORATE BONDS & NOTES 2.2% | ||||||||||||
AUSTRIA 0.0% | ||||||||||||
INDUSTRIALS 0.0% | ||||||||||||
OGX Austria GmbH | ||||||||||||
8.375% due 04/01/2022 ^ | $ | 200 | 0 | |||||||||
8.500% due 06/01/2018 ^ | 200 | 0 | ||||||||||
|
| |||||||||||
0 | ||||||||||||
|
| |||||||||||
Total Austria | 0 | |||||||||||
|
| |||||||||||
BRAZIL 0.3% | ||||||||||||
BANKING & FINANCE 0.1% | ||||||||||||
Banco Votorantim S.A. | ||||||||||||
5.250% due 02/11/2016 | 200 | 200 | ||||||||||
|
|
PRINCIPAL | MARKET VALUE (000S) | |||||||||||
UTILITIES 0.2% | ||||||||||||
Petrobras Global Finance BV | ||||||||||||
2.461% due 01/15/2019 | $ | 9 | $ | 7 | ||||||||
2.886% due 03/17/2017 | 23 | 21 | ||||||||||
3.250% due 03/17/2017 | 20 | 19 | ||||||||||
3.406% due 03/17/2020 | 11 | 8 | ||||||||||
3.500% due 02/06/2017 | 28 | 26 | ||||||||||
4.250% due 10/02/2023 | EUR | 100 | 68 | |||||||||
4.375% due 05/20/2023 | $ | 45 | 30 | |||||||||
4.875% due 03/17/2020 | 243 | 183 | ||||||||||
5.375% due 01/27/2021 | 1,083 | 809 | ||||||||||
6.250% due 12/14/2026 | GBP | 100 | 96 | |||||||||
6.850% due 06/05/2115 | $ | 90 | 59 | |||||||||
|
| |||||||||||
1,326 | ||||||||||||
|
| |||||||||||
Total Brazil | 1,526 | |||||||||||
|
| |||||||||||
CAYMAN ISLANDS 0.0% | ||||||||||||
UTILITIES 0.0% | ||||||||||||
Odebrecht Drilling Norbe Ltd. |
| |||||||||||
6.350% due 06/30/2022 | 157 | 58 | ||||||||||
|
| |||||||||||
Total Cayman Islands | 58 | |||||||||||
|
| |||||||||||
FRANCE 0.1% | ||||||||||||
BANKING & FINANCE 0.1% | ||||||||||||
BPCE S.A. |
| |||||||||||
12.500% due 08/29/2049 | 100 | 128 | ||||||||||
12.500% due 09/30/2019 (d) | EUR | 300 | 438 | |||||||||
|
| |||||||||||
566 | ||||||||||||
|
| |||||||||||
Total France | 566 | |||||||||||
|
| |||||||||||
IRELAND 0.1% | ||||||||||||
BANKING & FINANCE 0.0% | ||||||||||||
Vnesheconombank Via VEB Finance PLC |
| |||||||||||
6.902% due 07/09/2020 | $ | 100 | 101 | |||||||||
|
| |||||||||||
INDUSTRIALS 0.1% | ||||||||||||
Russian Railways via RZD Capital PLC |
| |||||||||||
7.487% due 03/25/2031 | GBP | 300 | 419 | |||||||||
|
| |||||||||||
UTILITIES 0.0% | ||||||||||||
AK Transneft OJSC Via TransCapitalInvest Ltd. |
| |||||||||||
8.700% due 08/07/2018 | $ | 100 | 110 | |||||||||
|
| |||||||||||
Total Ireland | 630 | |||||||||||
|
| |||||||||||
LUXEMBOURG 0.9% | ||||||||||||
BANKING & FINANCE 0.2% | ||||||||||||
Sberbank of Russia Via SB Capital S.A. |
| |||||||||||
3.352% due 11/15/2019 | EUR | 300 | 321 | |||||||||
6.125% due 02/07/2022 | $ | 1,000 | 1,007 | |||||||||
|
| |||||||||||
1,328 | ||||||||||||
|
| |||||||||||
UTILITIES 0.7% | ||||||||||||
Gazprom Neft OAO Via GPN Capital S.A. |
| |||||||||||
4.375% due 09/19/2022 | 300 | 266 | ||||||||||
6.000% due 11/27/2023 | 300 | 284 | ||||||||||
Gazprom OAO Via Gaz Capital S.A. |
| |||||||||||
5.999% due 01/23/2021 | 30 | 30 | ||||||||||
6.605% due 02/13/2018 | EUR | 50 | 57 |
PRINCIPAL | MARKET VALUE (000S) | |||||||||||
9.250% due 04/23/2019 | $ | 3,100 | $ | 3,471 | ||||||||
|
| |||||||||||
4,108 | ||||||||||||
|
| |||||||||||
Total Luxembourg | 5,436 | |||||||||||
|
| |||||||||||
MEXICO 0.0% | ||||||||||||
INDUSTRIALS 0.0% | ||||||||||||
Corp. GEO S.A.B. de C.V. |
| |||||||||||
8.875% due 03/27/2022 ^ | $ | 300 | 6 | |||||||||
9.250% due 06/30/2020 ^ | 100 | 2 | ||||||||||
|
| |||||||||||
8 | ||||||||||||
|
| |||||||||||
Total Mexico | 8 | |||||||||||
|
| |||||||||||
NETHERLANDS 0.0% | ||||||||||||
INDUSTRIALS 0.0% | ||||||||||||
Schaeffler Holding Finance BV (6.875% Cash or 6.875% PIK) |
| |||||||||||
6.875% due 08/15/2018 (a) | EUR | 100 | 113 | |||||||||
|
| |||||||||||
Total Netherlands | 113 | |||||||||||
|
| |||||||||||
UNITED KINGDOM 0.5% | ||||||||||||
BANKING & FINANCE 0.3% | ||||||||||||
Barclays Bank PLC | ||||||||||||
14.000% due 06/15/2019 (d) | GBP | 300 | 573 | |||||||||
Co-operative Group Holdings Ltd. |
| |||||||||||
6.875% due 07/08/2020 | 200 | 322 | ||||||||||
LBG Capital PLC | ||||||||||||
15.000% due 12/21/2019 | 300 | 602 | ||||||||||
Mitchells & Butlers Finance PLC |
| |||||||||||
1.033% due 12/15/2030 | 159 | 210 | ||||||||||
Royal Bank of Scotland PLC | ||||||||||||
9.500% due 03/16/2022 | $ | 200 | 217 | |||||||||
|
| |||||||||||
1,924 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 0.2% | ||||||||||||
Enterprise Inns PLC | ||||||||||||
6.875% due 02/15/2021 | GBP | 200 | 314 | |||||||||
Marstons Issuer PLC | ||||||||||||
5.641% due 07/15/2035 | 200 | 277 | ||||||||||
Priory Group PLC | ||||||||||||
8.875% due 02/15/2019 | 200 | 305 | ||||||||||
Spirit Issuer PLC | ||||||||||||
3.289% due 12/28/2031 | 22 | 30 | ||||||||||
6.582% due 12/28/2027 | 200 | 309 | ||||||||||
|
| |||||||||||
1,235 | ||||||||||||
|
| |||||||||||
Total United Kingdom | 3,159 | |||||||||||
|
| |||||||||||
UNITED STATES 0.3% | ||||||||||||
BANKING & FINANCE 0.1% | ||||||||||||
Cantor Fitzgerald LP |
| |||||||||||
7.875% due 10/15/2019 | $ | 280 | 308 | |||||||||
International Lease Finance Corp. |
| |||||||||||
7.125% due 09/01/2018 | 325 | 357 | ||||||||||
|
| |||||||||||
665 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 0.2% | ||||||||||||
Caesars Entertainment Operating Co., Inc. |
| |||||||||||
8.500% due 02/15/2020 ^(e) | 291 | 223 | ||||||||||
9.000% due 02/15/2020 ^(e) | 244 | 187 | ||||||||||
11.250% due 06/01/2017 ^(e) | 309 | 233 |
42 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
PRINCIPAL | MARKET VALUE (000S) | |||||||||||
CVS Pass-Through Trust |
| |||||||||||
8.353% due 07/10/2031 | $ | 86 | $ | 106 | ||||||||
iHeartCommunications, Inc. |
| |||||||||||
9.000% due 03/01/2021 | 3 | 2 | ||||||||||
9.000% due 12/15/2019 | 54 | 40 | ||||||||||
9.000% due 09/15/2022 | 210 | 146 | ||||||||||
|
| |||||||||||
937 | ||||||||||||
|
| |||||||||||
Total United States | 1,602 | |||||||||||
|
| |||||||||||
VENEZUELA 0.0% | ||||||||||||
INDUSTRIALS 0.0% | ||||||||||||
Petroleos de Venezuela S.A. | ||||||||||||
8.500% due 11/02/2017 | 400 | 214 | ||||||||||
|
| |||||||||||
Total Venezuela | 214 | |||||||||||
|
| |||||||||||
Total Corporate Bonds & Notes | 13,312 | |||||||||||
|
| |||||||||||
NON-AGENCY MORTGAGE-BACKED SECURITIES 2.2% | ||||||||||||
UNITED STATES 2.2% | ||||||||||||
American Home Mortgage Assets Trust |
| |||||||||||
6.250% due 06/25/2037 | 150 | 109 | ||||||||||
Banc of America Alternative Loan Trust |
| |||||||||||
6.000% due 04/25/2036 ^ | 79 | 68 | ||||||||||
6.000% due 06/25/2046 ^ | 94 | 77 | ||||||||||
6.000% due 07/25/2046 ^ | 160 | 132 | ||||||||||
Banc of America Funding Trust |
| |||||||||||
4.007% due 05/20/2036 ^ | 38 | 35 | ||||||||||
Banc of America Mortgage Trust |
| |||||||||||
5.060% due 11/20/2046 ^ | 18 | 15 | ||||||||||
6.000% due 10/25/2036 ^ | 45 | 38 | ||||||||||
Bear Stearns ALT-A Trust |
| |||||||||||
2.820% due 05/25/2036 ^ | 180 | 124 | ||||||||||
3.048% due 09/25/2035 ^ | 131 | 99 | ||||||||||
Bear Stearns Mortgage Funding Trust |
| |||||||||||
7.000% due 08/25/2036 | 212 | 201 | ||||||||||
Chase Mortgage Finance Trust |
| |||||||||||
2.720% due 09/25/2036 ^ | 93 | 81 | ||||||||||
Citigroup Mortgage Loan Trust, Inc. |
| |||||||||||
2.643% due 07/25/2046 ^ | 21 | 19 | ||||||||||
Countrywide Alternative Loan Resecuritization Trust |
| |||||||||||
6.000% due 05/25/2036 ^ | 43 | 38 | ||||||||||
Countrywide Alternative Loan Trust |
| |||||||||||
1.122% due 10/25/2037 ^ | 7,027 | 3,200 | ||||||||||
6.000% due 06/25/2036 ^ | 231 | 208 | ||||||||||
6.000% due 02/25/2037 ^ | 203 | 162 | ||||||||||
6.000% due 06/25/2037 ^ | 683 | 570 | ||||||||||
6.250% due 12/25/2036 ^ | 43 | 35 | ||||||||||
Countrywide Home Loan Mortgage Pass-Through Trust |
| |||||||||||
0.922% due 07/25/2037 ^ | 36 | 26 | ||||||||||
2.634% due 09/25/2037 ^ | 122 | 107 | ||||||||||
Credit Suisse First Boston Mortgage Securities Corp. |
| |||||||||||
6.000% due 11/25/2035 ^ | 25 | 17 | ||||||||||
6.000% due 01/25/2036 | 70 | 54 | ||||||||||
Credit Suisse Mortgage Capital Certificates |
| |||||||||||
2.838% due 12/29/2037 | 202 | 120 | ||||||||||
Credit Suisse Mortgage Capital Mortgage-Backed Trust |
| |||||||||||
5.000% due 03/25/2037 ^ | 4 | 4 | ||||||||||
6.750% due 08/25/2036 ^ | 30 | 24 | ||||||||||
First Horizon Alternative Mortgage Securities Trust |
| |||||||||||
2.448% due 06/25/2036 | 729 | 601 | ||||||||||
HarborView Mortgage Loan Trust |
| |||||||||||
4.007% due 06/19/2036 ^ | 27 | 19 | ||||||||||
HSI Asset Loan Obligation Trust |
| |||||||||||
6.000% due 06/25/2037 ^ | 20 | 17 |
PRINCIPAL | MARKET VALUE (000S) | |||||||||||
IndyMac Mortgage Loan Trust |
| |||||||||||
2.389% due 06/25/2037 | $ | 233 | $ | 132 | ||||||||
2.652% due 08/25/2035 ^ | 209 | 173 | ||||||||||
2.950% due 05/25/2037 ^ | 167 | 128 | ||||||||||
JPMorgan Alternative Loan Trust |
| |||||||||||
1.799% due 05/26/2037 | 134 | 120 | ||||||||||
JPMorgan Mortgage Trust |
| |||||||||||
6.500% due 07/25/2036 ^ | 115 | 87 | ||||||||||
Merrill Lynch Mortgage Investors Trust |
| |||||||||||
2.658% due 03/25/2036 ^ | 23 | 16 | ||||||||||
Morgan Stanley Mortgage Loan Trust |
| |||||||||||
2.809% due 06/25/2037 | 729 | 485 | ||||||||||
RBSSP Resecuritization Trust |
| |||||||||||
9.391% due 06/26/2037 | 185 | 110 | ||||||||||
Residential Accredit Loans, Inc. Trust |
| |||||||||||
0.822% due 10/25/2045 | 170 | 122 | ||||||||||
5.500% due 03/25/2037 | 813 | 636 | ||||||||||
6.250% due 03/25/2037 ^ | 60 | 49 | ||||||||||
Residential Funding Mortgage Securities, Inc. Trust |
| |||||||||||
6.000% due 10/25/2036 ^ | 17 | 16 | ||||||||||
Structured Adjustable Rate Mortgage Loan Trust |
| |||||||||||
2.655% due 10/25/2036 ^ | 3,766 | 2,800 | ||||||||||
Wells Fargo Alternative Loan Trust |
| |||||||||||
2.768% due 07/25/2037 ^ | 2,415 | 2,059 | ||||||||||
|
| |||||||||||
Total Non-Agency Mortgage-Backed Securities (Cost $13,309) | 13,133 | |||||||||||
|
| |||||||||||
MUNICIPAL BONDS & NOTES 0.1% | ||||||||||||
MICHIGAN 0.0% | ||||||||||||
Michigan Tobacco Settlement Finance Authority Revenue Bonds, Series 2006 |
| |||||||||||
7.309% due 06/01/2034 | 225 | 194 | ||||||||||
|
| |||||||||||
Total Michigan | 194 | |||||||||||
|
| |||||||||||
VIRGINIA 0.0% | ||||||||||||
Tobacco Settlement Financing Corp., Virginia Revenue Bonds, Series 2007 |
| |||||||||||
6.706% due 06/01/2046 | 385 | 298 | ||||||||||
|
| |||||||||||
Total Virginia | 298 | |||||||||||
|
| |||||||||||
WEST VIRGINIA 0.1% | ||||||||||||
Tobacco Settlement Finance Authority, West Virginia Revenue Bonds, Series 2007 |
| |||||||||||
7.467% due 06/01/2047 | 370 | 321 | ||||||||||
|
| |||||||||||
Total West Virginia | 321 | |||||||||||
|
| |||||||||||
Total Municipal Bonds & Notes | 813 | |||||||||||
|
| |||||||||||
SHARES | ||||||||||||
REAL ESTATE INVESTMENT TRUSTS 4.6% | ||||||||||||
UNITED STATES 4.6% | ||||||||||||
FINANCIALS 4.6% | ||||||||||||
Colony Capital, Inc. ‘A’ | 996,680 | 19,415 | ||||||||||
Outfront Media, Inc. | 386,758 | 8,443 | ||||||||||
|
| |||||||||||
27,858 | ||||||||||||
|
| |||||||||||
Total Real Estate Investment Trusts | 27,858 | |||||||||||
|
| |||||||||||
PRINCIPAL | MARKET VALUE (000S) | |||||||||||
SOVEREIGN ISSUES 0.2% | ||||||||||||
BRAZIL 0.1% | ||||||||||||
Brazil Notas do Tesouro Nacional |
| |||||||||||
6.000% due 08/15/2050 | BRL | 718 | $ | 156 | ||||||||
Brazil Notas do Tesouro Nacional Inflation Linked Bond |
| |||||||||||
6.000% due 05/15/2045 | 1,386 | 298 | ||||||||||
|
| |||||||||||
Total Brazil | 454 | |||||||||||
|
| |||||||||||
GREECE 0.1% | ||||||||||||
Republic of Greece Government International Bond |
| |||||||||||
3.800% due 08/08/2017 | JPY | 29,000 | 217 | |||||||||
4.500% due 07/03/2017 | 10,000 | 77 | ||||||||||
4.750% due 04/17/2019 | EUR | 100 | 100 | |||||||||
|
| |||||||||||
Total Greece | 394 | |||||||||||
|
| |||||||||||
VENEZUELA 0.0% | ||||||||||||
Venezuela Government International Bond |
| |||||||||||
7.750% due 10/13/2019 | $ | 200 | 80 | |||||||||
7.650% due 04/21/2025 | 100 | 38 | ||||||||||
|
| |||||||||||
Total Venezuela | 118 | |||||||||||
|
| |||||||||||
Total Sovereign Issues (Cost $1,630) | 966 | |||||||||||
|
| |||||||||||
SHORT-TERM INSTRUMENTS 0.4% | ||||||||||||
REPURCHASE AGREEMENTS (f) 0.2% | ||||||||||||
1,159 | ||||||||||||
|
| |||||||||||
U.S. TREASURY BILLS 0.2% | ||||||||||||
0.195% due 01/14/2016 - 01/21/2016 (c)(i) | 1,487 | 1,487 | ||||||||||
|
| |||||||||||
Total Short-Term Instruments (Cost $2,646) | 2,646 | |||||||||||
|
| |||||||||||
Total Investments in Securities (Cost $670,653) | 609,774 | |||||||||||
|
| |||||||||||
SHARES | ||||||||||||
INVESTMENTS IN AFFILIATES 0.8% | ||||||||||||
SHORT-TERM INSTRUMENTS 0.8% | ||||||||||||
CENTRAL FUNDS USED FOR CASH MANAGEMENT PURPOSES 0.8% | ||||||||||||
PIMCO Short-Term Floating NAV Portfolio III | 486,115 | 4,800 | ||||||||||
|
| |||||||||||
Total Short-Term Instruments (Cost $4,800) | 4,800 | |||||||||||
|
| |||||||||||
Total Investments in Affiliates (Cost $4,800) | 4,800 | |||||||||||
Total Investments 101.8% (Cost $675,453) | $ | 614,574 | ||||||||||
Financial Derivative (Cost or Premiums, net $0) | 421 | |||||||||||
Other Assets and Liabilities, net (1.9%) | (11,417 | ) | ||||||||||
|
| |||||||||||
Net Assets 100.0% | $ | 603,578 | ||||||||||
|
|
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 43 |
Table of Contents
Schedule of Investments PIMCO Dividend and Income Builder Fund (Cont.)
NOTES TO SCHEDULE OF INVESTMENTS (AMOUNTS IN THOUSANDS*, EXCEPT NUMBER OF CONTRACTS):
* | A zero balance may reflect actual amounts rounding to less than one thousand. |
^ | Security is in default. |
(a) | Payment in-kind bond security. |
(b) | Security did not produce income within the last twelve months. |
(c) | Coupon represents a weighted average yield to maturity. |
(d) | Perpetual maturity; date shown, if applicable, represents next contractual call date. |
(e) | Security is subject to a forbearance agreement entered into by the Fund which forbears the Fund from taking action to, among other things, accelerate and collect payments on the subject note with respect to specified events of default. |
BORROWINGS AND OTHER FINANCING TRANSACTIONS
(f) REPURCHASE AGREEMENTS:
Counterparty | Lending Rate | Settlement Date | Maturity Date | Principal Amount | Collateralized By | Collateral (Received), at Value | Repurchase Agreements, at Value | Repurchase Agreement Proceeds to be Received (1) | ||||||||||||||||||||
SSB | 0.010% | 12/31/2015 | 01/04/2016 | $ | 1,159 | Fannie Mae 2.170% due 10/17/2022 | $ | (1,185 | ) | $ | 1,159 | $ | 1,159 | |||||||||||||||
|
|
|
|
|
| |||||||||||||||||||||||
Total Repurchase Agreements |
| $ | (1,185 | ) | $ | 1,159 | $ | 1,159 | ||||||||||||||||||||
|
|
|
|
|
|
(1) | Includes accrued interest. |
BORROWINGS AND OTHER FINANCING TRANSACTIONS SUMMARY
The following is a summary by counterparty of the market value of Borrowings and Other Financing Transactions and collateral (received) as of December 31, 2015:
Counterparty | Repurchase Agreement Proceeds to be Received | Payable for Reverse Repurchase Agreements | Payable for Sale-Buyback Transactions | Total Borrowings and Other Financing Transactions | Collateral (Received) | Net Exposure (2) | ||||||||||||||||||
Global/Master Repurchase Agreement | ||||||||||||||||||||||||
SSB | $ | 1,159 | $ | 0 | $ | 0 | $ | 1,159 | $ | (1,185 | ) | $ | (26 | ) | ||||||||||
|
|
|
|
|
| |||||||||||||||||||
Total Borrowings and Other Financing Transactions | $ | 1,159 | $ | 0 | $ | 0 | ||||||||||||||||||
|
|
|
|
|
|
(2) | Net Exposure represents the net receivable/(payable) that would be due from/to the counterparty in the event of default. Exposure from borrowings and other financing transactions can only be netted across transactions governed under the same master agreement with the same legal entity. See Note 7, Principal Risks, in the Notes to Financial Statements for more information regarding master netting arrangements. |
(g) FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED
FUTURES CONTRACTS:
Description | Type | Expiration Month | # of Contracts | Unrealized Appreciation/ (Depreciation) | Variation Margin | |||||||||||||||||
Asset | Liability | |||||||||||||||||||||
British pound currency March Futures | Short | 03/2016 | 39 | $ | 64 | $ | 24 | $ | 0 | |||||||||||||
Euro currency March Futures | Short | 03/2016 | 8 | 3 | 6 | 0 | ||||||||||||||||
Japanese yen currency March Futures | Short | 03/2016 | 3 | (7 | ) | 0 | (1 | ) | ||||||||||||||
|
|
|
|
|
| |||||||||||||||||
Total Futures Contracts | $ | 60 | $ | 30 | $ | (1 | ) | |||||||||||||||
|
|
|
|
|
|
FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED SUMMARY
The following is a summary of the market value and variation margin of Exchange-Traded or Centrally Cleared Financial Derivative Instruments as of December 31, 2015:
Cash of $194 has been pledged as collateral for exchange-traded and centrally cleared financial derivative instruments as of December 31, 2015. See Note 7, Principal Risks, in the Notes to Financial Statements for more information regarding master netting arrangements.
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||
Market Value | Variation Margin Asset | Total | Market Value | Variation Margin Liability | Total | |||||||||||||||||||||||||||||
Purchased Options | Futures | Swap Agreements | Written Options | Futures | Swap Agreements | |||||||||||||||||||||||||||||
Total Exchange-Traded or Centrally Cleared | $ | 0 | $ | 30 | $ | 0 | $ | 30 | $ | 0 | $ | (1) | $ | 0 | $ | (1) | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
44 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
(h) FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER
FORWARD FOREIGN CURRENCY CONTRACTS:
Counterparty | Settlement Month | Currency to | Currency to | Unrealized Appreciation/ (Depreciation) | ||||||||||||||||||||||||
Asset | Liability | |||||||||||||||||||||||||||
BOA | 01/2016 | CAD | 2,822 | $ | 2,031 | $ | 0 | $ | (8 | ) | ||||||||||||||||||
01/2016 | EUR | 13,414 | 14,739 | 162 | 0 | |||||||||||||||||||||||
02/2016 | $ | 14,750 | EUR | 13,414 | 0 | (162 | ) | |||||||||||||||||||||
CBK | 01/2016 | 14,657 | 13,414 | 0 | (79 | ) | ||||||||||||||||||||||
01/2016 | 67,565 | GBP | 45,528 | 0 | (448 | ) | ||||||||||||||||||||||
02/2016 | GBP | 45,528 | $ | 67,568 | 445 | 0 | ||||||||||||||||||||||
02/2016 | $ | 201 | CAD | 268 | 0 | (8 | ) | |||||||||||||||||||||
02/2016 | 31,810 | GBP | 21,587 | 16 | 0 | |||||||||||||||||||||||
HUS | 01/2016 | EUR | 49,385 | $ | 52,628 | 0 | (1,041 | ) | ||||||||||||||||||||
JPM | 01/2016 | $ | 1,987 | EUR | 1,821 | 0 | (9 | ) | ||||||||||||||||||||
MSB | 01/2016 | GBP | 45,528 | $ | 68,640 | 1,523 | 0 | |||||||||||||||||||||
UAG | 01/2016 | $ | 53,943 | EUR | 49,385 | 0 | (274 | ) | ||||||||||||||||||||
02/2016 | EUR | 49,385 | $ | 53,981 | 275 | 0 | ||||||||||||||||||||||
|
|
|
| |||||||||||||||||||||||||
Total Forward Foreign Currency Contracts |
| $ | 2,421 | $ | (2,029 | ) | ||||||||||||||||||||||
|
|
|
|
FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER SUMMARY
The following is a summary by counterparty of the market value of OTC financial derivative instruments and collateral (received)/pledged as of December 31, 2015:
(i) | Securities with an aggregate market value of $1,487 have been pledged as collateral for financial derivative instruments as governed by International Swaps and Derivatives Association, Inc. master agreements as of December 31, 2015. |
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||||||||||||||
Counterparty | Forward Foreign | Purchased Options | Swap Agreements | Total Over the Counter | Forward Foreign | Written Options | Swap Agreements | Total Over the Counter | Net Market Value of OTC Derivatives | Collateral Pledged | Net Exposure (1) | |||||||||||||||||||||||||||||||||||
BOA | $ | 162 | $ | 0 | $ | 0 | $ | 162 | $ | (170 | ) | $ | 0 | $ | 0 | $ | (170 | ) | $ | (8 | ) | $ | 0 | $ | (8 | ) | ||||||||||||||||||||
CBK | 461 | 0 | 0 | 461 | (535 | ) | 0 | 0 | (535 | ) | (74 | ) | 0 | (74 | ) | |||||||||||||||||||||||||||||||
HUS | 0 | 0 | 0 | 0 | (1,041 | ) | 0 | 0 | (1,041 | ) | (1,041 | ) | 1,487 | 446 | ||||||||||||||||||||||||||||||||
JPM | 0 | 0 | 0 | 0 | (9 | ) | 0 | 0 | (9 | ) | (9 | ) | 0 | (9 | ) | |||||||||||||||||||||||||||||||
MSB | 1,523 | 0 | 0 | 1,523 | 0 | 0 | 0 | 0 | 1,523 | (1,250 | ) | 273 | ||||||||||||||||||||||||||||||||||
UAG | 275 | 0 | 0 | 275 | (274 | ) | 0 | 0 | (274 | ) | 1 | 0 | 1 | |||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||||||||
Total Over the Counter | $ | 2,421 | $ | 0 | $ | 0 | $ | 2,421 | $ | (2,029 | ) | $ | 0 | $ | 0 | $ | (2,029 | ) | ||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) | Net Exposure represents the net receivable/(payable) that would be due from/to the counterparty in the event of default. Exposure from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same legal entity. See Note 7, Principal Risks, in the Notes to Financial Statements for more information regarding master netting arrangements. |
FAIR VALUE OF FINANCIAL DERIVATIVE INSTRUMENTS
The following is a summary of the fair valuation of the Fund’s derivative instruments categorized by risk exposure. See Note 7, Principal Risks, in the Notes to Financial Statements on risks of the Fund.
Fair Values of Financial Derivative Instruments on the Statements of Assets and Liabilities as of December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Financial Derivative Instruments - Assets | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Futures | $ | 0 | $ | 0 | $ | 0 | $ | 30 | $ | 0 | $ | 30 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | 2,421 | $ | 0 | $ | 2,421 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 0 | $ | 0 | $ | 0 | $ | 2,451 | $ | 0 | $ | 2,451 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Financial Derivative Instruments - Liabilities | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Futures | $ | 0 | $ | 0 | $ | 0 | $ | 1 | $ | 0 | $ | 1 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | 2,029 | $ | 0 | $ | 2,029 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 0 | $ | 0 | $ | 0 | $ | 2,030 | $ | 0 | $ | 2,030 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 45 |
Table of Contents
Schedule of Investments PIMCO Dividend and Income Builder Fund (Cont.)
The effect of Financial Derivative Instruments on the Statements of Operations for the period ended December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Net Realized Gain on Financial Derivative Instruments | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Futures | $ | 0 | $ | 0 | $ | 0 | $ | 175 | $ | 0 | $ | 175 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | 4,161 | $ | 0 | $ | 4,161 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 0 | $ | 0 | $ | 0 | $ | 4,336 | $ | 0 | $ | 4,336 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Net Change in Unrealized Appreciation on Financial Derivative Instruments |
| |||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Futures | $ | 0 | $ | 0 | $ | 0 | $ | 164 | $ | 0 | $ | 164 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | �� | $ | 0 | $ | 0 | $ | 1,819 | $ | 0 | $ | 1,819 | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 0 | $ | 0 | $ | 0 | $ | 1,983 | $ | 0 | $ | 1,983 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
FAIR VALUE MEASUREMENTS
The following is a summary of the fair valuations according to the inputs used as of December 31, 2015 in valuing the Fund’s assets and liabilities:
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Investments in Securities, at Value | ||||||||||||||||
Asset-Backed Securities | ||||||||||||||||
United States | $ | 0 | $ | 12,469 | $ | 0 | $ | 12,469 | ||||||||
Bank Loan Obligations | ||||||||||||||||
Brazil | 0 | 0 | 16 | 16 | ||||||||||||
United States | 0 | 2,425 | 0 | 2,425 | ||||||||||||
Common Stocks | ||||||||||||||||
Australia | ||||||||||||||||
Consumer Discretionary | 0 | 10,906 | 0 | 10,906 | ||||||||||||
Health Care | 0 | 8,670 | 0 | 8,670 | ||||||||||||
Industrials | 0 | 12,038 | 0 | 12,038 | ||||||||||||
Brazil | ||||||||||||||||
Health Care | 0 | 2,886 | 0 | 2,886 | ||||||||||||
Industrials | 6,550 | 0 | 0 | 6,550 | ||||||||||||
Utilities | 0 | 1,871 | 0 | 1,871 | ||||||||||||
Canada | ||||||||||||||||
Utilities | 9,828 | 0 | 0 | 9,828 | ||||||||||||
France | ||||||||||||||||
Consumer Staples | 0 | 8,433 | 0 | 8,433 | ||||||||||||
Utilities | 0 | 11,325 | 0 | 11,325 | ||||||||||||
Germany | ||||||||||||||||
Materials | 5,906 | 0 | 0 | 5,906 | ||||||||||||
Greece | ||||||||||||||||
Consumer Discretionary | 0 | 7,796 | 0 | 7,796 | ||||||||||||
Hong Kong | ||||||||||||||||
Telecommunication Services | 0 | 17,229 | 0 | 17,229 | ||||||||||||
Italy | ||||||||||||||||
Financials | 0 | 16,948 | 0 | 16,948 | ||||||||||||
Industrials | 0 | 6,651 | 0 | 6,651 | ||||||||||||
Japan | ||||||||||||||||
Consumer Discretionary | 0 | 8,639 | 0 | 8,639 | ||||||||||||
Mexico | ||||||||||||||||
Consumer Staples | 2,890 | 0 | 0 | 2,890 | ||||||||||||
Netherlands | ||||||||||||||||
Financials | 0 | 25,638 | 0 | 25,638 | ||||||||||||
Russia | ||||||||||||||||
Consumer Staples | 1,947 | 0 | 0 | 1,947 | ||||||||||||
Spain | ||||||||||||||||
Consumer Staples | 0 | 8,481 | 0 | 8,481 | ||||||||||||
Switzerland | ||||||||||||||||
Health Care | 0 | 17,029 | 0 | 17,029 | ||||||||||||
Taiwan | ||||||||||||||||
Information Technology | 0 | 11,396 | 0 | 11,396 | ||||||||||||
Thailand | ||||||||||||||||
Telecommunication Services | 0 | 2,286 | 0 | 2,286 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
United Kingdom | ||||||||||||||||
Consumer Staples | $ | 0 | $ | 5,774 | $ | 0 | $ | 5,774 | ||||||||
Energy | 6,382 | 0 | 0 | 6,382 | ||||||||||||
Financials | 0 | 45,332 | 0 | 45,332 | ||||||||||||
Telecommunication Services | 0 | 22,303 | 0 | 22,303 | ||||||||||||
United States | ||||||||||||||||
Consumer Discretionary | 38,589 | 0 | 0 | 38,589 | ||||||||||||
Energy | 11,390 | 0 | 0 | 11,390 | ||||||||||||
Financials | 16,969 | 0 | 0 | 16,969 | ||||||||||||
Health Care | 45,773 | 0 | 0 | 45,773 | ||||||||||||
Industrials | 11,398 | 0 | 0 | 11,398 | ||||||||||||
Information Technology | 56,766 | 0 | 0 | 56,766 | ||||||||||||
Materials | 14,144 | 0 | 0 | 14,144 | ||||||||||||
Telecommunication Services | 33,171 | 0 | 0 | 33,171 | ||||||||||||
Utilities | 22,802 | 0 | 0 | 22,802 | ||||||||||||
Corporate Bonds & Notes | ||||||||||||||||
Brazil | ||||||||||||||||
Banking & Finance | 0 | 200 | 0 | 200 | ||||||||||||
Utilities | 0 | 1,326 | 0 | 1,326 | ||||||||||||
Cayman Islands | ||||||||||||||||
Utilities | 0 | 58 | 0 | 58 | ||||||||||||
France | ||||||||||||||||
Banking & Finance | 0 | 566 | 0 | 566 | ||||||||||||
Ireland | ||||||||||||||||
Banking & Finance | 0 | 101 | 0 | 101 | ||||||||||||
Industrials | 0 | 419 | 0 | 419 | ||||||||||||
Utilities | 0 | 110 | 0 | 110 | ||||||||||||
Luxembourg | ||||||||||||||||
Banking & Finance | 0 | 1,328 | 0 | 1,328 | ||||||||||||
Utilities | 0 | 4,108 | 0 | 4,108 | ||||||||||||
Mexico | ||||||||||||||||
Industrials | 0 | 8 | 0 | 8 | ||||||||||||
Netherlands | ||||||||||||||||
Industrials | 0 | 113 | 0 | 113 | ||||||||||||
United Kingdom | ||||||||||||||||
Banking & Finance | 0 | 1,924 | 0 | 1,924 | ||||||||||||
Industrials | 0 | 1,235 | 0 | 1,235 | ||||||||||||
United States | ||||||||||||||||
Banking & Finance | 0 | 665 | 0 | 665 | ||||||||||||
Industrials | 0 | 937 | 0 | 937 | ||||||||||||
Venezuela | ||||||||||||||||
Industrials | 0 | 214 | 0 | 214 | ||||||||||||
Non-Agency Mortgage-Backed Securities | ||||||||||||||||
United States | 0 | 13,133 | 0 | 13,133 |
46 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Municipal Bonds & Notes | ||||||||||||||||
Michigan | $ | 0 | $ | 194 | $ | 0 | $ | 194 | ||||||||
Virginia | 0 | 298 | 0 | 298 | ||||||||||||
West Virginia | 0 | 321 | �� | 0 | 321 | |||||||||||
Real Estate Investment Trusts | ||||||||||||||||
United States | ||||||||||||||||
Financials | 27,858 | 0 | 0 | 27,858 | ||||||||||||
Sovereign Issues | ||||||||||||||||
Brazil | 0 | 454 | 0 | 454 | ||||||||||||
Greece | 0 | 394 | 0 | 394 | ||||||||||||
Venezuela | 0 | 118 | 0 | 118 | ||||||||||||
Short-Term Instruments | ||||||||||||||||
Repurchase Agreements | 0 | 1,159 | 0 | 1,159 | ||||||||||||
U.S. Treasury Bills | 0 | 1,487 | 0 | 1,487 | ||||||||||||
$ | 312,363 | $ | 297,395 | $ | 16 | $ | 609,774 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Investments in Affiliates, at Value | ||||||||||||||||
Short-Term Instruments | ||||||||||||||||
Central Funds Used for Cash Management Purposes | $ | 4,800 | $ | 0 | $ | 0 | $ | 4,800 | ||||||||
Total Investments | $ | 317,163 | $ | 297,395 | $ | 16 | $ | 614,574 | ||||||||
Financial Derivative Instruments - Assets |
| |||||||||||||||
Exchange-traded or centrally cleared | 30 | 0 | 0 | 30 | ||||||||||||
Over the counter | 0 | 2,421 | 0 | 2,421 | ||||||||||||
$ | 30 | $ | 2,421 | $ | 0 | $ | 2,451 | |||||||||
Financial Derivative Instruments - Liabilities |
| |||||||||||||||
Exchange-traded or centrally cleared | (1 | ) | 0 | 0 | (1 | ) | ||||||||||
Over the counter | 0 | (2,029 | ) | 0 | (2,029 | ) | ||||||||||
$ | (1 | ) | $ | (2,029 | ) | $ | 0 | $ | (2,030 | ) | ||||||
Totals | $ | 317,192 | $ | 297,787 | $ | 16 | $ | 614,995 |
There were no significant transfers between Levels 1, 2, or 3 during the period ended December 31, 2015.
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 47 |
Table of Contents
Schedule of Investments PIMCO EqS® Long/Short Fund
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN SECURITIES 67.2% | ||||||||||||
COMMON STOCKS 51.2% | ||||||||||||
UNITED KINGDOM 1.7% | ||||||||||||
FINANCIALS 1.7% | ||||||||||||
Markit Ltd. (a) | 500,000 | $ | 15,085 | |||||||||
|
| |||||||||||
Total United Kingdom | 15,085 | |||||||||||
|
| |||||||||||
UNITED STATES 49.5% | ||||||||||||
CONSUMER DISCRETIONARY 6.8% | ||||||||||||
Dollar General Corp. (e) | 80,000 | 5,750 | ||||||||||
Kate Spade & Co. (a) | 200,000 | 3,554 | ||||||||||
Live Nation Entertainment, Inc. (a) | 1,050,000 | 25,798 | ||||||||||
Nordstrom, Inc. | 465,000 | 23,162 | ||||||||||
|
| |||||||||||
58,264 | ||||||||||||
|
| |||||||||||
CONSUMER STAPLES 1.2% | ||||||||||||
Sanderson Farms, Inc. (e) | 137,412 | 10,652 | ||||||||||
|
| |||||||||||
ENERGY 0.4% | ||||||||||||
Newfield Exploration Co. (a) | 100,000 | 3,256 | ||||||||||
|
| |||||||||||
FINANCIALS 3.4% | ||||||||||||
Bank of New York Mellon Corp. | 500,000 | 20,610 | ||||||||||
Citizens Financial Group, Inc. (e) | 320,000 | 8,381 | ||||||||||
|
| |||||||||||
28,991 | ||||||||||||
|
| |||||||||||
HEALTH CARE 7.3% | ||||||||||||
DaVita HealthCare Partners, Inc. (a)(e) | 250,000 | 17,427 | ||||||||||
Laboratory Corp. of America Holdings (a) | 345,000 | 42,656 | ||||||||||
Mylan NV (a) | 50,000 | 2,704 | ||||||||||
|
| |||||||||||
62,787 | ||||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
INDUSTRIALS 10.9% | ||||||||||||
General Dynamics Corp. (e) | 80,000 | $ | 10,989 | |||||||||
KAR Auction Services, Inc. (e) | 1,000,000 | 37,030 | ||||||||||
Kirby Corp. (a) | 350,000 | 18,417 | ||||||||||
Neilsen Holdings PLC (e) | 350,000 | 16,310 | ||||||||||
Northrop Grumman Corp. (e) | 60,000 | 11,328 | ||||||||||
|
| |||||||||||
94,074 | ||||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 15.8% | ||||||||||||
Alphabet, Inc. ‘C’ (a)(e) | 27,000 | 20,490 | ||||||||||
Booz Allen Hamilton Holding Corp. (e) | 370,000 | 11,414 | ||||||||||
DST Systems, Inc. (e) | 296,000 | 33,762 | ||||||||||
First Data Corp. ‘A’ (a) | 3,150,000 | 50,463 | ||||||||||
Jabil Circuit, Inc. (e) | 400,000 | 9,316 | ||||||||||
Mentor Graphics Corp. | 592,000 | 10,905 | ||||||||||
|
| |||||||||||
136,350 | ||||||||||||
|
| |||||||||||
MATERIALS 1.1% | ||||||||||||
Sealed Air Corp. (e) | 220,000 | 9,812 | ||||||||||
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| |||||||||||
TELECOMMUNICATION SERVICES 2.6% | ||||||||||||
Level 3 Communications, Inc. (a)(e) | 411,635 | 22,376 | ||||||||||
|
| |||||||||||
Total United States | 426,562 | |||||||||||
|
| |||||||||||
Total Common Stocks (Cost $414,500) |
| 441,647 | ||||||||||
|
| |||||||||||
REAL ESTATE INVESTMENT TRUSTS 5.5% | ||||||||||||
UNITED STATES 5.5% | ||||||||||||
FINANCIALS 5.5% | ||||||||||||
Iron Mountain, Inc. | 1,750,000 | 47,268 | ||||||||||
|
| |||||||||||
Total Real Estate Investment Trusts |
| 47,268 | ||||||||||
|
| |||||||||||
MARKET VALUE (000S) | ||||||||||||
SHORT-TERM INSTRUMENTS 10.5% | ||||||||||||
REPURCHASE AGREEMENTS (c) 0.1% |
| |||||||||||
$ | 517 | |||||||||||
|
| |||||||||||
PRINCIPAL AMOUNT (000S) | ||||||||||||
U.S. TREASURY BILLS 10.4% | ||||||||||||
0.148% due 01/07/2016 -01/28/2016 (b)(g) | $ | 89,518 | 89,513 | |||||||||
|
| |||||||||||
Total Short-Term Instruments (Cost $90,028) | 90,030 | |||||||||||
|
| |||||||||||
Total Investments in Securities (Cost $556,375) | 578,945 | |||||||||||
|
| |||||||||||
SHARES | ||||||||||||
INVESTMENTS IN AFFILIATES 35.5% | ||||||||||||
SHORT-TERM INSTRUMENTS 35.5% | ||||||||||||
CENTRAL FUNDS USED FOR CASH MANAGEMENT PURPOSES 35.5% | ||||||||||||
PIMCO Short-Term | 30,967,838 | 305,776 | ||||||||||
|
| |||||||||||
Total Short-Term Instruments (Cost $307,000) | 305,776 | |||||||||||
|
| |||||||||||
Total Investments in Affiliates (Cost $307,000) | 305,776 | |||||||||||
Total Investments 102.7% (Cost $863,375) | $ | 884,721 | ||||||||||
Securities Sold Short (d) (37.2%) (Proceeds $327,141) | (320,587 | ) | ||||||||||
Financial Derivative (Cost or Premiums, net $0) |
| (280 | ) | |||||||||
Other Assets and Liabilities, net 34.5% | 297,369 | |||||||||||
|
| |||||||||||
Net Assets 100.0% | $ | 861,223 | ||||||||||
|
|
NOTES TO SCHEDULE OF INVESTMENTS (AMOUNTS IN THOUSANDS*, EXCEPT NUMBER OF SHARES):
* | A zero balance may reflect actual amounts rounding to less than one thousand. |
(a) | Security did not produce income within the last twelve months. |
(b) | Coupon represents a weighted average yield to maturity. |
BORROWINGS AND OTHER FINANCING TRANSACTIONS
(c) REPURCHASE AGREEMENTS:
Counterparty | Lending Rate | Settlement Date | Maturity Date | Principal Amount | Collateralized By | Collateral (Received), at Value | Repurchase Agreements, at Value | Repurchase Agreement Proceeds to be Received (1) | ||||||||||||||||||||
SSB | 0.010% | 12/31/2015 | 01/04/2016 | $ | 517 | Fannie Mae 2.170% due 10/17/2022 | $ | (531 | ) | $ | 517 | $ | 517 | |||||||||||||||
|
|
|
|
|
| |||||||||||||||||||||||
Total Repurchase Agreements |
| $ | (531 | ) | $ | 517 | $ | 517 | ||||||||||||||||||||
|
|
|
|
|
|
(1) | Includes accrued interest. |
48 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
(d) SECURITIES SOLD SHORT:
(e) | Securities with an aggregate market value of $153,799 and cash of $324,753 have been pledged as collateral as of December 31, 2015 for equity short sales and equity options as governed by prime brokerage agreements and agreements governing listed equity option transactions. |
Counterparty | Description | Shares | Proceeds | Payable for Short Sales (2) | ||||||||||
Common Stocks | ||||||||||||||
Canada | ||||||||||||||
Consumer Discretionary | ||||||||||||||
FOB | Lululemon Athletica, Inc. | (120,000 | ) | $ | (6,261 | ) | $ | (6,297 | ) | |||||
GSC | Restaurant Brands International, Inc. | (134,800 | ) | (4,841 | ) | (5,036 | ) | |||||||
Finland | ||||||||||||||
Industrials | ||||||||||||||
Kone OYJ ‘B’ | (300,000 | ) | (11,967 | ) | (12,702 | ) | ||||||||
Italy | ||||||||||||||
Consumer Discretionary | ||||||||||||||
Ferrari NV | (116,000 | ) | (5,855 | ) | (5,568 | ) | ||||||||
Switzerland | ||||||||||||||
Energy | ||||||||||||||
FOB | Transocean Ltd. | (900,000 | ) | (12,434 | ) | (11,142 | ) | |||||||
United Kingdom | ||||||||||||||
Consumer Discretionary | ||||||||||||||
GSC | Burberry Group PLC | (100,000 | ) | (1,788 | ) | (1,775 | ) | |||||||
Energy | ||||||||||||||
FOB | Ensco PLC ‘A’ | (400,000 | ) | (6,183 | ) | (6,156 | ) | |||||||
United States | ||||||||||||||
Consumer Discretionary | ||||||||||||||
Buckle, Inc. | (150,000 | ) | (4,650 | ) | (4,617 | ) | ||||||||
Darden Restaurants, Inc. | (100,000 | ) | (5,594 | ) | (6,364 | ) | ||||||||
GSC | Carter’s, Inc. | (60,000 | ) | (5,358 | ) | (5,342 | ) | |||||||
Cracker Barrel Old Country Store, Inc. | (52,000 | ) | (7,046 | ) | (6,595 | ) | ||||||||
New York Times Co. ‘A’ | (150,000 | ) | (2,073 | ) | (2,013 | ) | ||||||||
Ralph Lauren Corp. | (50,000 | ) | (5,556 | ) | (5,599 | ) | ||||||||
Restoration Hardware Holdings, Inc. | (60,000 | ) | (5,100 | ) | (4,767 | ) | ||||||||
Sonic Corp. | (148,133 | ) | (4,256 | ) | (4,786 | ) | ||||||||
Consumer Staples | ||||||||||||||
FOB | Coty, Inc. ‘A’ | (440,000 | ) | (12,065 | ) | (11,277 | ) | |||||||
Mead Johnson Nutrition Co. | (155,000 | ) | (11,882 | ) | (12,291 | ) | ||||||||
Energy | ||||||||||||||
Cabot Oil & Gas Corp. | (575,000 | ) | (10,420 | ) | (10,172 | ) | ||||||||
Gulfport Energy Corp. | (530,000 | ) | (12,345 | ) | (13,022 | ) | ||||||||
Hess Corp. | (150,000 | ) | (7,232 | ) | (7,272 | ) | ||||||||
Matador Resources Co. | (195,000 | ) | (3,844 | ) | (3,855 | ) | ||||||||
Range Resources Corp. | (575,000 | ) | (15,693 | ) | (14,151 | ) | ||||||||
National Oilwell Varco, Inc. | (300,000 | ) | (11,409 | ) | (10,047 | ) | ||||||||
Financials | ||||||||||||||
Realogy Holdings Corp. | (70,000 | ) | (2,553 | ) | (2,567 | ) | ||||||||
GSC | LPL Financial Holdings, Inc. | (300,000 | ) | (11,582 | ) | (12,795 | ) | |||||||
NorthStar Asset Management Group, Inc. | (800,000 | ) | (14,907 | ) | (9,712 | ) | ||||||||
Health Care | ||||||||||||||
FOB | MEDNAX, Inc. | (70,000 | ) | (5,080 | ) | (5,016 | ) | |||||||
GSC | Abaxis, Inc. | (200,000 | ) | (10,417 | ) | (11,136 | ) | |||||||
Industrials | ||||||||||||||
FOB | Covanta Holding Corp. | (800,000 | ) | (11,511 | ) | (12,592 | ) | |||||||
Donaldson Co., Inc. | (270,000 | ) | (7,808 | ) | (7,738 | ) | ||||||||
Lincoln Electric Holdings, Inc. | (100,000 | ) | (5,034 | ) | (5,221 | ) | ||||||||
MSC Industrial Direct Co., Inc. ‘A’ | (140,000 | ) | (8,442 | ) | (7,878 | ) | ||||||||
WW Grainger, Inc. | (67,000 | ) | (13,196 | ) | (13,573 | ) | ||||||||
GSC | 3M Co. | (50,000 | ) | (7,520 | ) | (7,532 | ) | |||||||
Cintas Corp. | (25,000 | ) | (2,285 | ) | (2,276 | ) | ||||||||
Deere & Co. | (100,000 | ) | (7,758 | ) | (7,681 | ) | ||||||||
Fastenal Co. | (140,000 | ) | (5,533 | ) | (5,715 | ) | ||||||||
Herman Miller, Inc. | (100,000 | ) | (2,815 | ) | (2,870 | ) | ||||||||
Oshkosh Corp. | (250,000 | ) | (9,933 | ) | (9,760 | ) | ||||||||
XPO Logistics, Inc. | (195,800 | ) | (5,309 | ) | (5,336 | ) |
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 49 |
Table of Contents
Schedule of Investments PIMCO EqS® Long/Short Fund (Cont.)
Counterparty | Description | Shares | Proceeds | Payable for Short Sales (2) | ||||||||||
Information Technology | ||||||||||||||
FOB | Computer Sciences Corp. | (200,000 | ) | $ | (6,631 | ) | $ | (6,564 | ) | |||||
Teradata Corp. | (200,000 | ) | (5,732 | ) | (5,284 | ) | ||||||||
GSC | Zillow Group, Inc. ‘C’ | (278,534 | ) | (7,207 | ) | (6,540 | ) | |||||||
Materials | ||||||||||||||
FOB | Tronox Ltd. ‘A’ | (500,000 | ) | (2,036 | ) | (1,955 | ) | |||||||
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Total Short Sales | $ | (327,141 | ) | $ | (320,587 | ) | ||||||||
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(2) | Payable for short sales includes $408 of dividends payable. |
BORROWINGS AND OTHER FINANCING TRANSACTIONS SUMMARY
The following is a summary by counterparty of the market value of Borrowings and Other Financing Transactions and collateral (received)/pledged as of December 31, 2015:
Counterparty | Repurchase Agreement Proceeds to be Received | Payable for Reverse Repurchase Agreements | Payable for Sale-Buyback Transactions | Payable for Short Sales | Total Borrowings and Other Financing Transactions | Collateral (Received)/Pledged | Net Exposure (3) | |||||||||||||||||||||
Global/Master Repurchase Agreement | ||||||||||||||||||||||||||||
SSB | $ | 517 | $ | 0 | $ | 0 | $ | 0 | $ | 517 | $ | (531 | ) | $ | (14 | ) | ||||||||||||
Prime Brokerage Agreement | ||||||||||||||||||||||||||||
FOB | 0 | 0 | 0 | (178,895 | ) | (178,895 | ) | 221,264 | 42,369 | |||||||||||||||||||
GSC | 0 | 0 | 0 | (141,692 | ) | �� | (141,692 | ) | 257,165 | 115,473 | ||||||||||||||||||
MSC | 0 | 0 | 0 | 0 | 0 | 123 | 123 | |||||||||||||||||||||
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Total Borrowings and Other Financing Transactions | $ | 517 | $ | 0 | $ | 0 | $ | (320,587 | ) | |||||||||||||||||||
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(3) | Net Exposure represents the net receivable/(payable) that would be due from/to the counterparty in the event of default. Exposure from borrowings and other financing transactions can only be netted across transactions governed under the same master agreement with the same legal entity. See Note 7, Principal Risks, in the Notes to Financial Statements for more information regarding master netting arrangements. |
(f) FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER
FORWARD FOREIGN CURRENCY CONTRACTS:
Counterparty | Settlement Month | Currency to be Delivered | Currency to be Received | Unrealized Appreciation/ (Depreciation) | ||||||||||||||||||||||||
Asset | Liability | |||||||||||||||||||||||||||
HUS | 01/2016 | EUR | 13,285 | $ | 14,158 | $ | 0 | $ | (280 | ) | ||||||||||||||||||
UAG | 01/2016 | $ | 14,511 | EUR | 13,285 | 0 | (74 | ) | ||||||||||||||||||||
02/2016 | EUR | 13,285 | $ | 14,521 | 74 | 0 | ||||||||||||||||||||||
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| |||||||||||||||||||||||||
Total Forward Foreign Currency Contracts |
| $ | 74 | $ | (354 | ) | ||||||||||||||||||||||
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|
WRITTEN OPTIONS:
AS OF DECEMBER 31, 2015, THERE WERE NO OPEN WRITTEN OPTIONS. TRANSACTIONS IN WRITTEN CALL AND PUT OPTIONS FOR THE PERIOD ENDED DECEMBER 31, 2015:
# of Contracts | Premiums | |||||||
Balance at Beginning of Period | 0 | $ | 0 | |||||
Sales | 2,700 | (588 | ) | |||||
Closing Buys | 0 | 0 | ||||||
Expirations | 0 | 0 | ||||||
Exercised | (2,700 | ) | 588 | |||||
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| |||||
Balance at End of Period | 0 | $ | 0 | |||||
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|
50 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER SUMMARY
The following is a summary by counterparty of the market value of OTC financial derivative instruments and collateral pledged as of December 31, 2015:
(g) | Securities with an aggregate market value of $281 have been pledged as collateral for financial derivative instruments as governed by International Swaps and Derivatives Association, Inc. master agreements as of December 31, 2015. |
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||||||||||||||
Counterparty | Forward Foreign Currency Contracts | Purchased Options | Swap Agreements | Total Over the Counter | Forward Foreign Currency Contracts | Written Options | Swap Agreements | Total Over the Counter | Net Market Value of OTC Derivatives | Collateral Pledged | Net Exposure (1) | |||||||||||||||||||||||||||||||||||
HUS | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | (280 | ) | $ | 0 | $ | 0 | $ | (280 | ) | $ | (280 | ) | $ | 281 | $ | 1 | |||||||||||||||||||||
UAG | 74 | 0 | 0 | 74 | (74 | ) | 0 | 0 | (74 | ) | 0 | 0 | 0 | |||||||||||||||||||||||||||||||||
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| |||||||||||||||||||||||||||||||
Total Over the Counter | $ | 74 | $ | 0 | $ | 0 | $ | 74 | $ | (354 | ) | $ | 0 | $ | 0 | $ | (354 | ) | ||||||||||||||||||||||||||||
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(1) | Net Exposure represents the net receivable/(payable) that would be due from/to the counterparty in the event of default. Exposure from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same legal entity. See Note 7, Principal Risks, in the Notes to Financial Statements for more information regarding master netting arrangements. |
FAIR VALUE OF FINANCIAL DERIVATIVE INSTRUMENTS
The following is a summary of the fair valuation of the Fund’s derivative instruments categorized by risk exposure. See Note 7, Principal Risks, in the Notes to Financial Statements on risks of the Fund.
Fair Values of Financial Derivative Instruments on the Statements of Assets and Liabilities as of December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Financial Derivative Instruments - Assets | ||||||||||||||||||||||||
Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | 74 | $ | 0 | $ | 74 | ||||||||||||
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| |||||||||||||
Financial Derivative Instruments - Liabilities | ||||||||||||||||||||||||
Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | 354 | $ | 0 | $ | 354 | ||||||||||||
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The effect of Financial Derivative Instruments on the Statements of Operations for the period ended December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Net Realized Gain (Loss) on Financial Derivative Instruments |
| |||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Purchased Options | $ | 0 | $ | 0 | $ | (2,829 | ) | $ | 0 | $ | 0 | $ | (2,829 | ) | ||||||||||
Futures | 0 | 0 | (1,831 | ) | 0 | 0 | (1,831 | ) | ||||||||||||||||
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| |||||||||||||
$ | 0 | $ | 0 | $ | (4,660 | ) | $ | 0 | $ | 0 | $ | (4,660 | ) | |||||||||||
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| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | 786 | $ | 0 | $ | 786 | ||||||||||||
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| |||||||||||||
$ | 0 | $ | 0 | $ | (4,660 | ) | $ | 786 | $ | 0 | $ | (3,874 | ) | |||||||||||
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Net Change in Unrealized Appreciation (Depreciation) on Financial Derivative Instruments |
| |||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Purchased Options | $ | 0 | $ | 0 | $ | 2,346 | $ | 0 | $ | 0 | $ | 2,346 | ||||||||||||
Futures | 0 | 0 | (202 | ) | 0 | 0 | (202 | ) | ||||||||||||||||
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| |||||||||||||
$ | 0 | $ | 0 | $ | 2,144 | $ | 0 | $ | 0 | $ | 2,144 | |||||||||||||
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|
| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | (191 | ) | $ | 0 | $ | (191 | ) | ||||||||||
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|
|
| |||||||||||||
$ | 0 | $ | 0 | $ | 2,144 | $ | (191 | ) | $ | 0 | $ | 1,953 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 51 |
Table of Contents
Schedule of Investments PIMCO EqS® Long/Short Fund (Cont.)
December 31, 2015 (Unaudited)
FAIR VALUE MEASUREMENTS
The following is a summary of the fair valuations according to the inputs used as of December 31, 2015 in valuing the Fund’s assets and liabilities:
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Investments in Securities, at Value | ||||||||||||||||
Common Stocks | ||||||||||||||||
United Kingdom | ||||||||||||||||
Financials | $ | 15,085 | $ | 0 | $ | 0 | $ | 15,085 | ||||||||
United States | ||||||||||||||||
Consumer Discretionary | 58,264 | 0 | 0 | 58,264 | ||||||||||||
Consumer Staples | 10,652 | 0 | 0 | 10,652 | ||||||||||||
Energy | 3,256 | 0 | 0 | 3,256 | ||||||||||||
Financials | 28,991 | 0 | 0 | 28,991 | ||||||||||||
Health Care | 62,787 | 0 | 0 | 62,787 | ||||||||||||
Industrials | 94,074 | 0 | 0 | 94,074 | ||||||||||||
Information Technology | 136,350 | 0 | 0 | 136,350 | ||||||||||||
Materials | 9,812 | 0 | 0 | 9,812 | ||||||||||||
Telecommunication Services | 22,376 | 0 | 0 | 22,376 | ||||||||||||
Real Estate Investment Trusts | ||||||||||||||||
United States | ||||||||||||||||
Financials | 47,268 | 0 | 0 | 47,268 | ||||||||||||
Short-Term Instruments | ||||||||||||||||
Repurchase Agreements | 0 | 517 | 0 | 517 | ||||||||||||
U.S. Treasury Bills | 0 | 89,513 | 0 | 89,513 | ||||||||||||
$ | 488,915 | $ | 90,030 | $ | 0 | $ | 578,945 | |||||||||
Investments in Affiliates, at Value | ||||||||||||||||
Short-Term Instruments | ||||||||||||||||
Central Funds Used for Cash Management Purposes | 305,776 | 0 | 0 | 305,776 | ||||||||||||
Total Investments | $ | 794,691 | $ | 90,030 | $ | 0 | $ | 884,721 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Short Sales, at Value - Liabilities | ||||||||||||||||
Common Stocks | ||||||||||||||||
Canada | ||||||||||||||||
Consumer Discretionary | $ | (11,333 | ) | $ | 0 | $ | 0 | $ | (11,333 | ) | ||||||
Finland | ||||||||||||||||
Industrials | 0 | (12,702 | ) | 0 | (12,702 | ) | ||||||||||
Italy | ||||||||||||||||
Consumer Discretionary | (5,568 | ) | 0 | 0 | (5,568 | ) | ||||||||||
Switzerland | ||||||||||||||||
Energy | (11,142 | ) | 0 | 0 | (11,142 | ) | ||||||||||
United Kingdom | ||||||||||||||||
Consumer Discretionary | 0 | (1,775 | ) | 0 | (1,775 | ) | ||||||||||
Energy | (6,156 | ) | 0 | 0 | (6,156 | ) | ||||||||||
United States | ||||||||||||||||
Consumer Discretionary | (40,083 | ) | 0 | 0 | (40,083 | ) | ||||||||||
Consumer Staples | (23,568 | ) | 0 | 0 | (23,568 | ) | ||||||||||
Energy | (58,519 | ) | 0 | 0 | (58,519 | ) | ||||||||||
Financials | (25,074 | ) | 0 | 0 | (25,074 | ) | ||||||||||
Health Care | (16,152 | ) | 0 | 0 | (16,152 | ) | ||||||||||
Industrials | (88,172 | ) | 0 | 0 | (88,172 | ) | ||||||||||
Information Technology | (18,388 | ) | 0 | 0 | (18,388 | ) | ||||||||||
Materials | (1,955 | ) | 0 | 0 | (1,955 | ) | ||||||||||
|
|
|
|
|
|
|
| |||||||||
$ | (306,110 | ) | $ | (14,477 | ) | $ | 0 | $ | (320,587 | ) | ||||||
Financial Derivative Instruments - Assets |
| |||||||||||||||
Over the counter | $ | 0 | $ | 74 | $ | 0 | $ | 74 | ||||||||
Financial Derivative Instruments - Liabilities |
| |||||||||||||||
Over the counter | $ | 0 | $ | (354 | ) | $ | 0 | $ | (354 | ) | ||||||
Totals | $ | 488,581 | $ | 75,273 | $ | 0 | $ | 563,854 |
There were no significant transfers between Levels 1, 2, or 3 during the period ended December 31, 2015.
52 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
Schedule of Investments PIMCO Global Dividend Fund
December 31, 2015 (Unaudited)
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN SECURITIES 97.8% | ||||||||||||
COMMON STOCKS 93.9% | ||||||||||||
AUSTRALIA 3.5% | ||||||||||||
CONSUMER DISCRETIONARY 1.2% | ||||||||||||
G8 Education Ltd. | 451,915 | $ | 1,169 | |||||||||
|
| |||||||||||
HEALTH CARE 1.0% | ||||||||||||
Sonic Healthcare Ltd. | 74,674 | 967 | ||||||||||
|
| |||||||||||
INDUSTRIALS 1.3% | ||||||||||||
Spotless Group Holdings Ltd. | 1,600,629 | 1,254 | ||||||||||
|
| |||||||||||
Total Australia | 3,390 | |||||||||||
|
| |||||||||||
BRAZIL 2.1% | ||||||||||||
HEALTH CARE 0.5% | ||||||||||||
Qualicorp S.A. | 137,911 | 490 | ||||||||||
|
| |||||||||||
INDUSTRIALS 1.1% | ||||||||||||
Arteris S.A. | 433,300 | 1,057 | ||||||||||
|
| |||||||||||
UTILITIES 0.5% | ||||||||||||
Light S.A. | 212,710 | 531 | ||||||||||
|
| |||||||||||
Total Brazil | 2,078 | |||||||||||
|
| |||||||||||
CANADA 1.6% | ||||||||||||
UTILITIES 1.6% | ||||||||||||
Capital Power Corp. | 118,796 | 1,526 | ||||||||||
|
| |||||||||||
Total Canada | 1,526 | |||||||||||
|
| |||||||||||
FRANCE 3.4% | ||||||||||||
CONSUMER STAPLES 1.2% | ||||||||||||
Carrefour S.A. | 40,677 | 1,174 | ||||||||||
|
| |||||||||||
UTILITIES 2.2% | ||||||||||||
Engie S.A. | 117,929 | 2,089 | ||||||||||
|
| |||||||||||
Total France | 3,263 | |||||||||||
|
| |||||||||||
GERMANY 1.0% | ||||||||||||
MATERIALS 1.0% | ||||||||||||
Covestro AG (a) | 27,610 | 1,009 | ||||||||||
|
| |||||||||||
Total Germany | 1,009 | |||||||||||
|
| |||||||||||
GREECE 1.3% | ||||||||||||
CONSUMER DISCRETIONARY 1.3% | ||||||||||||
OPAP S.A. | 148,698 | 1,305 | ||||||||||
|
| |||||||||||
Total Greece | 1,305 | |||||||||||
|
| |||||||||||
HONG KONG 2.4% | ||||||||||||
TELECOMMUNICATION SERVICES 2.4% | ||||||||||||
China Mobile Ltd. | 211,000 | 2,375 | ||||||||||
|
| |||||||||||
Total Hong Kong | 2,375 | |||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
ITALY 3.8% | ||||||||||||
FINANCIALS 2.6% | ||||||||||||
Intesa Sanpaolo SpA | 762,293 | $ | 2,532 | |||||||||
|
| |||||||||||
INDUSTRIALS 1.2% | ||||||||||||
Societa Iniziative Autostradali e Servizi SpA | 112,282 | 1,193 | ||||||||||
|
| |||||||||||
Total Italy | 3,725 | |||||||||||
|
| |||||||||||
JAPAN 3.5% | ||||||||||||
CONSUMER DISCRETIONARY 1.5% | ||||||||||||
Bridgestone Corp. | 40,946 | 1,404 | ||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 2.0% | ||||||||||||
Nippon Telegraph & Telephone Corp. | 49,396 | 1,966 | ||||||||||
|
| |||||||||||
Total Japan | 3,370 | |||||||||||
|
| |||||||||||
MEXICO 0.5% | ||||||||||||
CONSUMER STAPLES 0.5% | ||||||||||||
Coca-Cola Femsa S.A.B. de C.V. ‘L’ | 66,500 | 476 | ||||||||||
|
| |||||||||||
Total Mexico | 476 | |||||||||||
|
| |||||||||||
NETHERLANDS 3.9% | ||||||||||||
FINANCIALS 3.9% | ||||||||||||
Aegon NV | 501,672 | 2,837 | ||||||||||
NN Group NV | 27,259 | 962 | ||||||||||
|
| |||||||||||
3,799 | ||||||||||||
|
| |||||||||||
Total Netherlands | 3,799 | |||||||||||
|
| |||||||||||
RUSSIA 0.4% | ||||||||||||
CONSUMER STAPLES 0.4% | ||||||||||||
Magnit PJSC SP - GDR | 10,450 | 420 | ||||||||||
|
| |||||||||||
Total Russia | 420 | |||||||||||
|
| |||||||||||
SPAIN 1.5% | ||||||||||||
CONSUMER STAPLES 1.5% | ||||||||||||
Ebro Foods S.A. | 72,985 | 1,436 | ||||||||||
|
| |||||||||||
Total Spain | 1,436 | |||||||||||
|
| |||||||||||
SWITZERLAND 2.2% | ||||||||||||
HEALTH CARE 2.2% | ||||||||||||
Roche Holding AG | 7,691 | 2,131 | ||||||||||
|
| |||||||||||
Total Switzerland | 2,131 | |||||||||||
|
| |||||||||||
TAIWAN 1.6% | ||||||||||||
INFORMATION TECHNOLOGY 1.6% | ||||||||||||
Taiwan Semiconductor Manufacturing Co. Ltd. | 370,871 | 1,600 | ||||||||||
|
| |||||||||||
Total Taiwan | 1,600 | |||||||||||
|
| |||||||||||
UNITED KINGDOM 12.9% | ||||||||||||
CONSUMER STAPLES 1.1% | ||||||||||||
Imperial Tobacco Group PLC | 20,729 | 1,095 | ||||||||||
|
| |||||||||||
SHARES | MARKET VALUE (000S) | |||||||||||
ENERGY 1.1% | ||||||||||||
Golar LNG Partners LP | 82,182 | $ | 1,100 | |||||||||
|
| |||||||||||
FINANCIALS 7.2% | ||||||||||||
HSBC Holdings PLC | 328,835 | 2,596 | ||||||||||
ICAP PLC | 204,785 | 1,537 | ||||||||||
Lloyds Banking Group PLC | 2,642,610 | 2,843 | ||||||||||
|
| |||||||||||
6,976 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 3.5% | ||||||||||||
Vodafone Group PLC | 1,053,340 | 3,416 | ||||||||||
|
| |||||||||||
Total United Kingdom | 12,587 | |||||||||||
|
| |||||||||||
UNITED STATES 48.3% | ||||||||||||
CONSUMER DISCRETIONARY 8.4% | ||||||||||||
Comcast Corp. ‘A’ | 37,924 | 2,140 | ||||||||||
General Motors Co. | 65,072 | 2,213 | ||||||||||
Kohl’s Corp. | 20,490 | 976 | ||||||||||
Macy’s, Inc. | 27,218 | 952 | ||||||||||
SeaWorld Entertainment, Inc. | 48,776 | 960 | ||||||||||
Time Warner, Inc. | 14,996 | 970 | ||||||||||
|
| |||||||||||
8,211 | ||||||||||||
|
| |||||||||||
ENERGY 2.1% | ||||||||||||
Schlumberger Ltd. | 29,109 | 2,030 | ||||||||||
|
| |||||||||||
FINANCIALS 6.8% | ||||||||||||
Blackstone Group LP | 78,238 | 2,288 | ||||||||||
Navient Corp. | 83,778 | 959 | ||||||||||
Prudential Financial, Inc. | 23,395 | 1,905 | ||||||||||
Regions Financial Corp. | 149,175 | 1,432 | ||||||||||
|
| |||||||||||
6,584 | ||||||||||||
|
| |||||||||||
HEALTH CARE 7.3% | ||||||||||||
AbbVie, Inc. | 41,295 | 2,446 | ||||||||||
Merck & Co., Inc. | 38,881 | 2,054 | ||||||||||
Pfizer, Inc. | 81,421 | 2,628 | ||||||||||
|
| |||||||||||
7,128 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 2.0% | ||||||||||||
Neilsen Holdings PLC | 41,560 | 1,937 | ||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 11.8% | ||||||||||||
Apple, Inc. | 20,116 | 2,118 | ||||||||||
Cisco Systems, Inc. | 79,366 | 2,155 | ||||||||||
QUALCOMM, Inc. | 58,082 | 2,903 | ||||||||||
Symantec Corp. | 69,446 | 1,458 | ||||||||||
Western Digital Corp. | 47,321 | 2,842 | ||||||||||
|
| |||||||||||
11,476 | ||||||||||||
|
| |||||||||||
MATERIALS 3.1% | ||||||||||||
International Paper Co. | 50,145 | 1,890 | ||||||||||
Steel Dynamics, Inc. | 63,389 | 1,133 | ||||||||||
|
| |||||||||||
3,023 | ||||||||||||
|
| |||||||||||
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 53 |
Table of Contents
Schedule of Investments PIMCO Global Dividend Fund (Cont.)
SHARES | MARKET VALUE (000S) | |||||||||||
TELECOMMUNICATION SERVICES 3.9% | ||||||||||||
AT&T, Inc. | 83,303 | $ | 2,866 | |||||||||
CenturyLink, Inc. | 37,873 | 953 | ||||||||||
|
| |||||||||||
3,819 | ||||||||||||
|
| |||||||||||
UTILITIES 2.9% | ||||||||||||
PG&E Corp. | 53,708 | 2,857 | ||||||||||
|
| |||||||||||
Total United States | 47,065 | |||||||||||
|
| |||||||||||
Total Common Stocks (Cost $97,890) | 91,555 | |||||||||||
|
| |||||||||||
REAL ESTATE INVESTMENT TRUSTS 2.8% | ||||||||||||
UNITED STATES 2.8% | ||||||||||||
FINANCIALS 2.8% | ||||||||||||
Colony Capital, Inc. ‘A’ | 95,139 | 1,853 | ||||||||||
Outfront Media, Inc. | 42,961 | 938 | ||||||||||
|
| |||||||||||
2,791 | ||||||||||||
|
| |||||||||||
Total Real Estate Investment Trusts | 2,791 | |||||||||||
|
|
MARKET VALUE (000S) | ||||||||||||
SHORT-TERM INSTRUMENTS 1.1% | ||||||||||||
REPURCHASE AGREEMENTS (b) 0.8% |
| |||||||||||
$ | 766 | |||||||||||
|
| |||||||||||
PRINCIPAL AMOUNT (000S) | ||||||||||||
U.S. TREASURY BILLS 0.3% | ||||||||||||
0.203% due 01/14/2016 (d) | $ | 281 | 281 | |||||||||
|
| |||||||||||
Total Short-Term Instruments (Cost $1,047) | 1,047 | |||||||||||
|
| |||||||||||
Total Investments in Securities (Cost $101,876) | 95,393 | |||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN AFFILIATES 1.3% | ||||||||||||
SHORT-TERM INSTRUMENTS 1.3% | ||||||||||||
CENTRAL FUNDS USED FOR CASH MANAGEMENT PURPOSES 1.3% | ||||||||||||
PIMCO Short-Term | 126,876 | $ | 1,253 | |||||||||
|
| |||||||||||
Total Short-Term Instruments (Cost $1,253) | 1,253 | |||||||||||
|
| |||||||||||
Total Investments in Affiliates (Cost $1,253) | 1,253 | |||||||||||
Total Investments 99.1% (Cost $103,129) | $ | 96,646 | ||||||||||
Financial Derivative (Cost or Premiums, net $0) | (74 | ) | ||||||||||
Other Assets and Liabilities, net 1.0% | 908 | |||||||||||
|
| |||||||||||
Net Assets 100.0% | $ | 97,480 | ||||||||||
|
|
NOTES TO SCHEDULE OF INVESTMENTS (AMOUNTS IN THOUSANDS*):
* | A zero balance may reflect actual amounts rounding to less than one thousand. |
(a) | Security did not produce income within the last twelve months. |
BORROWINGS AND OTHER FINANCING TRANSACTIONS
(b) REPURCHASE AGREEMENTS:
Counterparty | Lending Rate | Settlement Date | Maturity Date | Principal Amount | Collateralized By | Collateral (Received), at Value | Repurchase Agreements, at Value | Repurchase Agreement Proceeds to be Received (1) | ||||||||||||||||||||
SSB | 0.010% | 12/31/2015 | 01/04/2016 | $ | 766 | Fannie Mae 2.170% due 10/17/2022 | $ | (782 | ) | $ | 766 | $ | 766 | |||||||||||||||
|
|
|
|
|
| |||||||||||||||||||||||
Total Repurchase Agreements | $ | (782 | ) | $ | 766 | $ | 766 | |||||||||||||||||||||
|
|
|
|
|
|
(1) | Includes accrued interest. |
BORROWINGS AND OTHER FINANCING TRANSACTIONS SUMMARY
The following is a summary by counterparty of the market value of Borrowings and Other Financing Transactions and collateral (received) as of December 31, 2015:
Counterparty | Repurchase Agreement Proceeds to be Received | Payable for Reverse Repurchase Agreements | Payable for Sale-Buyback Transactions | Total Borrowings and Other Financing Transactions | Collateral (Received) | Net Exposure (2) | ||||||||||||||||||
Global/Master Repurchase Agreement | ||||||||||||||||||||||||
SSB | $ | 766 | $ | 0 | $ | 0 | $ | 766 | $ | (782 | ) | $ | (16 | ) | ||||||||||
|
|
|
|
|
| |||||||||||||||||||
Total Borrowings and Other Financing Transactions | $ | 766 | $ | 0 | $ | 0 | ||||||||||||||||||
|
|
|
|
|
|
(2) | Net Exposure represents the net receivable/(payable) that would be due from/to the counterparty in the event of default. Exposure from borrowings and other financing transactions can only be netted across transactions governed under the same master agreement with the same legal entity. See Note 7, Principal Risks, in the Notes to Financial Statements for more information regarding master netting arrangements. |
54 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
(c) FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER
FORWARD FOREIGN CURRENCY CONTRACTS:
Counterparty | Settlement Month | Currency to be Delivered | Currency to be Received | Unrealized Appreciation/ (Depreciation) | ||||||||||||||||||||||||
Asset | Liability | |||||||||||||||||||||||||||
BOA | 01/2016 | EUR | 3,475 | $ | 3,818 | $ | 42 | $ | 0 | |||||||||||||||||||
02/2016 | $ | 3,821 | EUR | 3,475 | 0 | (42 | ) | |||||||||||||||||||||
CBK | 01/2016 | 3,797 | 3,475 | 0 | (20 | ) | ||||||||||||||||||||||
01/2016 | 5,843 | GBP | 3,937 | 0 | (39 | ) | ||||||||||||||||||||||
02/2016 | GBP | 3,937 | $ | 5,843 | 38 | 0 | ||||||||||||||||||||||
HUS | 01/2016 | EUR | 8,757 | 9,333 | 0 | (184 | ) | |||||||||||||||||||||
02/2016 | $ | 75 | HKD | 582 | 0 | 0 | ||||||||||||||||||||||
02/2016 | 89 | SGD | 125 | 0 | (1 | ) | ||||||||||||||||||||||
MSB | 01/2016 | BRL | 473 | $ | 119 | 0 | 0 | |||||||||||||||||||||
01/2016 | GBP | 3,937 | 5,936 | 132 | 0 | |||||||||||||||||||||||
UAG | 01/2016 | $ | 9,566 | EUR | 8,758 | 0 | (49 | ) | ||||||||||||||||||||
02/2016 | EUR | 8,758 | $ | 9,573 | 49 | 0 | ||||||||||||||||||||||
|
|
|
| |||||||||||||||||||||||||
Total Forward Foreign Currency Contracts |
| $ | 261 | $ | (335 | ) | ||||||||||||||||||||||
|
|
|
|
FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER SUMMARY
The following is a summary by counterparty of the market value of OTC financial derivative instruments and collateral pledged as of December 31, 2015:
(d) | Securities with an aggregate market value of $281 have been pledged as collateral for financial derivative instruments as governed by International Swaps and Derivatives Association, Inc. master agreements as of December 31, 2015. |
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||||||||||||||
Counterparty | Forward Foreign Currency Contracts | Purchased Options | Swap Agreements | Total Over the Counter | Forward Foreign Currency Contracts | Written Options | Swap Agreements | Total Over the Counter | Net Market Value of OTC Derivatives | Collateral Pledged | Net Exposure (1) | |||||||||||||||||||||||||||||||||||
BOA | $ | 42 | $ | 0 | $ | 0 | $ | 42 | $ | (42 | ) | $ | 0 | $ | 0 | $ | (42 | ) | $ | 0 | $ | 0 | $ | 0 | ||||||||||||||||||||||
CBK | 38 | 0 | 0 | 38 | (59 | ) | 0 | 0 | (59 | ) | (21 | ) | 0 | (21 | ) | |||||||||||||||||||||||||||||||
HUS | 0 | 0 | 0 | 0 | (185 | ) | 0 | 0 | (185 | ) | (185 | ) | 281 | 96 | ||||||||||||||||||||||||||||||||
MSB | 132 | 0 | 0 | 132 | 0 | 0 | 0 | 0 | 132 | 0 | 132 | |||||||||||||||||||||||||||||||||||
UAG | 49 | 0 | 0 | 49 | (49 | ) | 0 | 0 | (49 | ) | 0 | 0 | 0 | |||||||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||||||||||||||||||||
Total Over the Counter | $ | 261 | $ | 0 | $ | 0 | $ | 261 | $ | (335 | ) | $ | 0 | $ | 0 | $ | (335 | ) | ||||||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) | Net Exposure represents the net receivable/(payable) that would be due from/to the counterparty in the event of default. Exposure from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same legal entity. See Note 7, Principal Risks, in the Notes to Financial Statements for more information regarding master netting arrangements. |
FAIR VALUE OF FINANCIAL DERIVATIVE INSTRUMENTS
The following is a summary of the fair valuation of the Fund’s derivative instruments categorized by risk exposure. See Note 7, Principal Risks, in the Notes to Financial Statements on risks of the Fund.
Fair Values of Financial Derivative Instruments on the Statements of Assets and Liabilities as of December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Financial Derivative Instruments - Assets | ||||||||||||||||||||||||
Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | 261 | $ | 0 | $ | 261 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Financial Derivative Instruments - Liabilities | ||||||||||||||||||||||||
Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | 335 | $ | 0 | $ | 335 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 55 |
Table of Contents
Schedule of Investments PIMCO Global Dividend Fund (Cont.)
December 31, 2015 (Unaudited)
The effect of Financial Derivative Instruments on the Statements of Operations for the period ended December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Net Realized Gain (Loss) on Financial Derivative Instruments | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Futures | $ | 0 | $ | 0 | $ | (10 | ) | $ | 0 | $ | 0 | $ | (10 | ) | ||||||||||
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Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | 336 | $ | 0 | $ | 336 | ||||||||||||
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$ | 0 | $ | 0 | $ | (10 | ) | $ | 336 | $ | 0 | $ | 326 | ||||||||||||
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Net Change in Unrealized Appreciation on Financial Derivative Instruments |
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Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | 210 | $ | 0 | $ | 210 | ||||||||||||
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FAIR VALUE MEASUREMENTS
The following is a summary of the fair valuations according to the inputs used as of December 31, 2015 in valuing the Fund’s assets and liabilities:
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Investments in Securities, at Value | ||||||||||||||||
Common Stocks | ||||||||||||||||
Australia | ||||||||||||||||
Consumer Discretionary | $ | 0 | $ | 1,169 | $ | 0 | $ | 1,169 | ||||||||
Health Care | 0 | 967 | 0 | 967 | ||||||||||||
Industrials | 0 | 1,254 | 0 | 1,254 | ||||||||||||
Brazil | ||||||||||||||||
Health Care | 0 | 490 | 0 | 490 | ||||||||||||
Industrials | 1,057 | 0 | 0 | 1,057 | ||||||||||||
Utilities | 0 | 531 | 0 | 531 | ||||||||||||
Canada | ||||||||||||||||
Utilities | 1,526 | 0 | 0 | 1,526 | ||||||||||||
France | ||||||||||||||||
Consumer Staples | 0 | 1,174 | 0 | 1,174 | ||||||||||||
Utilities | 0 | 2,089 | 0 | 2,089 | ||||||||||||
Germany | ||||||||||||||||
Materials | 1,009 | 0 | 0 | 1,009 | ||||||||||||
Greece | ||||||||||||||||
Consumer Discretionary | 0 | 1,305 | 0 | 1,305 | ||||||||||||
Hong Kong | ||||||||||||||||
Telecommunication Services | 0 | 2,375 | 0 | 2,375 | ||||||||||||
Italy | ||||||||||||||||
Financials | 0 | 2,532 | 0 | 2,532 | ||||||||||||
Industrials | 0 | 1,193 | 0 | 1,193 | ||||||||||||
Japan | ||||||||||||||||
Consumer Discretionary | 0 | 1,404 | 0 | 1,404 | ||||||||||||
Telecommunication Services | 0 | 1,966 | 0 | 1,966 | ||||||||||||
Mexico | ||||||||||||||||
Consumer Staples | 476 | 0 | 0 | 476 | ||||||||||||
Netherlands | ||||||||||||||||
Financials | 0 | 3,799 | 0 | 3,799 | ||||||||||||
Russia | ||||||||||||||||
Consumer Staples | 420 | 0 | 0 | 420 | ||||||||||||
Spain | ||||||||||||||||
Consumer Staples | 0 | 1,436 | 0 | 1,436 | ||||||||||||
Switzerland | ||||||||||||||||
Health Care | 0 | 2,131 | 0 | 2,131 | ||||||||||||
Taiwan | ||||||||||||||||
Information Technology | 0 | 1,600 | 0 | 1,600 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
United Kingdom | ||||||||||||||||
Consumer Staples | $ | 0 | $ | 1,095 | $ | 0 | $ | 1,095 | ||||||||
Energy | 1,100 | 0 | 0 | 1,100 | ||||||||||||
Financials | 0 | 6,976 | 0 | 6,976 | ||||||||||||
Telecommunication Services | 0 | 3,416 | 0 | 3,416 | ||||||||||||
United States | ||||||||||||||||
Consumer Discretionary | 8,211 | 0 | 0 | 8,211 | ||||||||||||
Energy | 2,030 | 0 | 0 | 2,030 | ||||||||||||
Financials | 6,584 | 0 | 0 | 6,584 | ||||||||||||
Health Care | 7,128 | 0 | 0 | 7,128 | ||||||||||||
Industrials | 1,937 | 0 | 0 | 1,937 | ||||||||||||
Information Technology | 11,476 | 0 | 0 | 11,476 | ||||||||||||
Materials | 3,023 | 0 | 0 | 3,023 | ||||||||||||
Telecommunication Services | 3,819 | 0 | 0 | 3,819 | ||||||||||||
Utilities | 2,857 | 0 | 0 | 2,857 | ||||||||||||
Real Estate Investment Trusts | ||||||||||||||||
United States | ||||||||||||||||
Financials | 2,791 | 0 | 0 | 2,791 | ||||||||||||
Short-Term Instruments | ||||||||||||||||
Repurchase Agreements | 0 | 766 | 0 | 766 | ||||||||||||
U.S. Treasury Bills | 0 | 281 | 0 | 281 | ||||||||||||
$ | 55,444 | $ | 39,949 | $ | 0 | $ | 95,393 | |||||||||
Investments in Affiliates, at Value | ||||||||||||||||
Short-Term Instruments | ||||||||||||||||
Central Funds Used for Cash Management Purposes | 1,253 | 0 | 0 | 1,253 | ||||||||||||
Total Investments | $ | 56,697 | $ | 39,949 | $ | 0 | $ | 96,646 | ||||||||
Financial Derivative Instruments - Assets |
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Over the counter | $ | 0 | $ | 261 | $ | 0 | $ | 261 | ||||||||
Financial Derivative Instruments - Liabilities |
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Over the counter | $ | 0 | $ | (335 | ) | $ | 0 | $ | (335 | ) | ||||||
Totals | $ | 56,697 | $ | 39,875 | $ | 0 | $ | 96,572 |
There were no significant transfers between Levels 1, 2, or 3 during the period ended December 31, 2015.
56 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
Schedule of Investments PIMCO International Dividend Fund
December 31, 2015 (Unaudited)
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN SECURITIES 98.4% | ||||||||||||
COMMON STOCKS 98.4% | ||||||||||||
AUSTRALIA 8.1% | ||||||||||||
CONSUMER DISCRETIONARY 1.8% | ||||||||||||
G8 Education Ltd. | 37,047 | $ | 96 | |||||||||
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CONSUMER STAPLES 1.8% | ||||||||||||
Coca-Cola Amatil Ltd. | 14,823 | 100 | ||||||||||
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HEALTH CARE 1.5% | ||||||||||||
Sonic Healthcare Ltd. | 6,258 | 81 | ||||||||||
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INDUSTRIALS 2.0% | ||||||||||||
Spotless Group Holdings Ltd. | 136,027 | 106 | ||||||||||
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MATERIALS 1.0% | ||||||||||||
Iluka Resources Ltd. | 12,636 | 56 | ||||||||||
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Total Australia | 439 | |||||||||||
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BRAZIL 3.0% | ||||||||||||
HEALTH CARE 0.4% | ||||||||||||
Qualicorp S.A. | 6,867 | 25 | ||||||||||
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INDUSTRIALS 1.5% | ||||||||||||
Arteris S.A. | 32,339 | 79 | ||||||||||
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UTILITIES 1.1% | ||||||||||||
Light S.A. | 23,780 | 59 | ||||||||||
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Total Brazil | 163 | |||||||||||
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CANADA 2.3% | ||||||||||||
UTILITIES 2.3% | ||||||||||||
Capital Power Corp. | 9,680 | 124 | ||||||||||
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Total Canada | 124 | |||||||||||
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CHINA 1.4% | ||||||||||||
CONSUMER STAPLES 1.4% | ||||||||||||
Want Want China Holdings Ltd. | 101,328 | 75 | ||||||||||
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Total China | 75 | |||||||||||
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FRANCE 6.3% | ||||||||||||
CONSUMER STAPLES 2.9% | ||||||||||||
Carrefour S.A. | 5,455 | 158 | ||||||||||
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UTILITIES 3.4% | ||||||||||||
Engie S.A. | 10,447 | 185 | ||||||||||
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Total France | 343 | |||||||||||
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GERMANY 1.3% | ||||||||||||
MATERIALS 1.3% | ||||||||||||
Covestro AG (a) | 1,908 | 70 | ||||||||||
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Total Germany | 70 | |||||||||||
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SHARES | MARKET VALUE (000S) | |||||||||||
GREECE 1.3% | ||||||||||||
CONSUMER DISCRETIONARY 1.3% | ||||||||||||
OPAP S.A. | 7,873 | $ | 69 | |||||||||
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Total Greece | 69 | |||||||||||
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HONG KONG 5.7% | ||||||||||||
TELECOMMUNICATION SERVICES 5.7% | ||||||||||||
China Mobile Ltd. | 16,052 | 180 | ||||||||||
PCCW Ltd. | 216,865 | 127 | ||||||||||
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307 | ||||||||||||
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Total Hong Kong | 307 | |||||||||||
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IRELAND 2.2% | ||||||||||||
MATERIALS 2.2% | ||||||||||||
Smurfit Kappa Group PLC | 4,748 | 122 | ||||||||||
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Total Ireland | 122 | |||||||||||
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ISRAEL 2.0% | ||||||||||||
HEALTH CARE 2.0% | ||||||||||||
Teva Pharmaceutical Industries Ltd. SP - ADR | 1,627 | 107 | ||||||||||
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Total Israel | 107 | |||||||||||
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ITALY 5.5% | ||||||||||||
FINANCIALS 3.9% | ||||||||||||
Intesa Sanpaolo SpA | 63,653 | 211 | ||||||||||
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INDUSTRIALS 1.6% | ||||||||||||
Societa Iniziative Autostradali e Servizi SpA | 7,991 | 85 | ||||||||||
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Total Italy | 296 | |||||||||||
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JAPAN 9.4% | ||||||||||||
CONSUMER DISCRETIONARY 4.0% | ||||||||||||
Bridgestone Corp. | 6,243 | 214 | ||||||||||
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CONSUMER STAPLES 2.5% | ||||||||||||
Lawson, Inc. | 1,643 | 134 | ||||||||||
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TELECOMMUNICATION SERVICES 2.9% | ||||||||||||
Nippon Telegraph & Telephone Corp. | 4,000 | 159 | ||||||||||
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Total Japan | 507 | |||||||||||
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MEXICO 1.3% | ||||||||||||
CONSUMER STAPLES 1.3% | ||||||||||||
Coca-Cola Femsa S.A.B. de C.V. ‘L’ | 10,224 | 73 | ||||||||||
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Total Mexico | 73 | |||||||||||
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NETHERLANDS 7.0% | ||||||||||||
FINANCIALS 7.0% | ||||||||||||
Aegon NV | 38,086 | 216 | ||||||||||
NN Group NV | 4,568 | 161 | ||||||||||
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377 | ||||||||||||
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Total Netherlands | 377 | |||||||||||
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SHARES | MARKET VALUE (000S) | |||||||||||
RUSSIA 0.9% | ||||||||||||
CONSUMER STAPLES 0.9% | ||||||||||||
Magnit PJSC SP - GDR | 1,167 | $ | 47 | |||||||||
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Total Russia | 47 | |||||||||||
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SPAIN 1.7% | ||||||||||||
CONSUMER STAPLES 1.7% | ||||||||||||
Ebro Foods S.A. | 4,614 | 91 | ||||||||||
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Total Spain | 91 | |||||||||||
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SWITZERLAND 4.0% | ||||||||||||
HEALTH CARE 4.0% | ||||||||||||
Roche Holding AG | 781 | 216 | ||||||||||
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Total Switzerland | 216 | |||||||||||
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TAIWAN 3.2% | ||||||||||||
INFORMATION TECHNOLOGY 3.2% | ||||||||||||
Taiwan Semiconductor Manufacturing Co. Ltd. | 39,673 | 171 | ||||||||||
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Total Taiwan | 171 | |||||||||||
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THAILAND 0.8% | ||||||||||||
TELECOMMUNICATION SERVICES 0.8% | ||||||||||||
Total Access Communication PCL NVDR | 49,809 | 42 | ||||||||||
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Total Thailand | 42 | |||||||||||
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UNITED KINGDOM 16.8% | ||||||||||||
CONSUMER STAPLES 1.0% | ||||||||||||
Imperial Tobacco Group PLC | 1,053 | 56 | ||||||||||
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ENERGY 1.0% | ||||||||||||
Golar LNG Partners LP | 4,148 | 55 | ||||||||||
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FINANCIALS 10.4% | ||||||||||||
HSBC Holdings PLC | 26,727 | 211 | ||||||||||
ICAP PLC | 18,193 | 136 | ||||||||||
Lloyds Banking Group PLC | 196,842 | 212 | ||||||||||
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559 | ||||||||||||
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TELECOMMUNICATION SERVICES 4.4% | ||||||||||||
Vodafone Group PLC | 72,433 | 235 | ||||||||||
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Total United Kingdom | 905 | |||||||||||
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UNITED STATES 14.2% | ||||||||||||
ENERGY 3.0% | ||||||||||||
Schlumberger Ltd. | 2,294 | 160 | ||||||||||
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HEALTH CARE 4.0% | ||||||||||||
AbbVie, Inc. | 1,531 | 91 | ||||||||||
Pfizer, Inc. | 3,918 | 126 | ||||||||||
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217 | ||||||||||||
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INDUSTRIALS 2.8% | ||||||||||||
Neilsen Holdings PLC | 3,192 | 149 | ||||||||||
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See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 57 |
Table of Contents
Schedule of Investments PIMCO International Dividend Fund (Cont.)
SHARES | MARKET VALUE (000S) | |||||||||||
INFORMATION TECHNOLOGY 4.4% | ||||||||||||
Cisco Systems, Inc. | 3,400 | $ | 92 | |||||||||
QUALCOMM, Inc. | 2,920 | 146 | ||||||||||
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238 | ||||||||||||
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Total United States | 764 | |||||||||||
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Total Common Stocks (Cost $5,703) | 5,308 | |||||||||||
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Total Investments in Securities (Cost $5,703) | 5,308 | |||||||||||
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SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN AFFILIATES 0.2% | ||||||||||||
SHORT-TERM INSTRUMENTS 0.2% | ||||||||||||
CENTRAL FUNDS USED FOR CASH MANAGEMENT PURPOSES 0.2% | ||||||||||||
PIMCO Short-Term | 1,036 | $ | 10 | |||||||||
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Total Short-Term Instruments (Cost $10) | 10 | |||||||||||
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Total Investments in Affiliates (Cost $10) | 10 | |||||||||||
Total Investments 98.6% (Cost $5,713) | $ | 5,318 | ||||||||||
Financial Derivative (Cost or Premiums, net $0) | (8 | ) | ||||||||||
Other Assets and Liabilities, net 1.5% | 82 | |||||||||||
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Net Assets 100.0% | $ | 5,392 | ||||||||||
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NOTES TO SCHEDULE OF INVESTMENTS (AMOUNTS IN THOUSANDS*):
* | A zero balance may reflect actual amounts rounding to less than one thousand. |
(a) | Security did not produce income within the last twelve months. |
(b) FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER
FORWARD FOREIGN CURRENCY CONTRACTS:
Counterparty | Settlement Month | Currency to be Delivered | Currency to be Received | Unrealized Appreciation/ (Depreciation) | ||||||||||||||||||||||||
Asset | Liability | |||||||||||||||||||||||||||
CBK | 02/2016 | AUD | 519 | $ | 365 | $ | 0 | $ | (13 | ) | ||||||||||||||||||
HUS | 02/2016 | EUR | 120 | 131 | 1 | 0 | ||||||||||||||||||||||
JPM | 01/2016 | $ | 168 | GBP | 113 | 0 | (1 | ) | ||||||||||||||||||||
02/2016 | GBP | 113 | $ | 168 | 1 | 0 | ||||||||||||||||||||||
MSB | 01/2016 | BRL | 16 | 4 | 0 | 0 | ||||||||||||||||||||||
01/2016 | GBP | 113 | 170 | 4 | 0 | |||||||||||||||||||||||
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Total Forward Foreign Currency Contracts | $ | 6 | $ | (14 | ) | |||||||||||||||||||||||
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FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER SUMMARY
The following is a summary by counterparty of the market value of OTC financial derivative instruments and collateral (received)/pledged as of December 31, 2015:
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||||||||||||||
Counterparty | Forward Foreign Currency Contracts | Purchased Options | Swap Agreements | Total Over the Counter | Forward Foreign Currency Contracts | Written Options | Swap Agreements | Total Over the Counter | Net Market Value of OTC Derivatives | Collateral (Received)/ Pledged | Net Exposure (1) | |||||||||||||||||||||||||||||||||||
CBK | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | (13 | ) | $ | 0 | $ | 0 | $ | (13 | ) | $ | (13 | ) | $ | 0 | $ | (13 | ) | ||||||||||||||||||||
HUS | 1 | 0 | 0 | 1 | 0 | 0 | 0 | 0 | 1 | 0 | 1 | |||||||||||||||||||||||||||||||||||
JPM | 1 | 0 | 0 | 1 | (1 | ) | 0 | 0 | (1 | ) | 0 | 0 | 0 | |||||||||||||||||||||||||||||||||
MSB | 4 | 0 | 0 | 4 | 0 | 0 | 0 | 0 | 4 | 0 | 4 | |||||||||||||||||||||||||||||||||||
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Total Over the Counter | $ | 6 | $ | 0 | $ | 0 | $ | 6 | $ | (14 | ) | $ | 0 | $ | 0 | $ | (14 | ) | ||||||||||||||||||||||||||||
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(1) | Net Exposure represents the net receivable/(payable) that would be due from/to the counterparty in the event of default. Exposure from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same legal entity. See Note 7, Principal Risks, in the Notes to Financial Statements for more information regarding master netting arrangements. |
58 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
FAIR VALUE OF FINANCIAL DERIVATIVE INSTRUMENTS
The following is a summary of the fair valuation of the Fund’s derivative instruments categorized by risk exposure. See Note 7, Principal Risks, in the Notes to Financial Statements on risks of the Fund.
Fair Values of Financial Derivative Instruments on the Statements of Assets and Liabilities as of December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Financial Derivative Instruments - Assets | ||||||||||||||||||||||||
Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | 6 | $ | 0 | $ | 6 | ||||||||||||
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Financial Derivative Instruments - Liabilities | ||||||||||||||||||||||||
Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | 14 | $ | 0 | $ | 14 | ||||||||||||
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The effect of Financial Derivative Instruments on the Statements of Operations for the period ended December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Net Realized Gain on Financial Derivative Instruments | ||||||||||||||||||||||||
Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | 23 | $ | 0 | $ | 23 | ||||||||||||
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Net Change in Unrealized (Depreciation) on Financial Derivative Instruments |
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Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | (9 | ) | $ | 0 | $ | (9 | ) | ||||||||||
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FAIR VALUE MEASUREMENTS
The following is a summary of the fair valuations according to the inputs used as of December 31, 2015 in valuing the Fund’s assets and liabilities:
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Investments in Securities, at Value | ||||||||||||||||
Common Stocks | ||||||||||||||||
Australia | ||||||||||||||||
Consumer Discretionary | $ | 0 | $ | 96 | $ | 0 | $ | 96 | ||||||||
Consumer Staples | 0 | 100 | 0 | 100 | ||||||||||||
Health Care | 0 | 81 | 0 | 81 | ||||||||||||
Industrials | 0 | 106 | 0 | 106 | ||||||||||||
Materials | 0 | 56 | 0 | 56 | ||||||||||||
Brazil | ||||||||||||||||
Health Care | 0 | 25 | 0 | 25 | ||||||||||||
Industrials | 79 | 0 | 0 | 79 | ||||||||||||
Utilities | 0 | 59 | 0 | 59 | ||||||||||||
Canada | ||||||||||||||||
Utilities | 124 | 0 | 0 | 124 | ||||||||||||
China | ||||||||||||||||
Consumer Staples | 0 | 75 | 0 | 75 | ||||||||||||
France | ||||||||||||||||
Consumer Staples | 0 | 158 | 0 | 158 | ||||||||||||
Utilities | 0 | 185 | 0 | 185 | ||||||||||||
Germany | ||||||||||||||||
Materials | 70 | 0 | 0 | 70 | ||||||||||||
Greece | ||||||||||||||||
Consumer Discretionary | 0 | 69 | 0 | 69 | ||||||||||||
Hong Kong | ||||||||||||||||
Telecommunication Services | 0 | 307 | 0 | 307 | ||||||||||||
Ireland | ||||||||||||||||
Materials | 0 | 122 | 0 | 122 | ||||||||||||
Israel | ||||||||||||||||
Health Care | 107 | 0 | 0 | 107 | ||||||||||||
Italy | ||||||||||||||||
Financials | 0 | 211 | 0 | 211 | ||||||||||||
Industrials | 0 | 85 | 0 | 85 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Japan | ||||||||||||||||
Consumer Discretionary | $ | 0 | $ | 214 | $ | 0 | $ | 214 | ||||||||
Consumer Staples | 0 | 134 | 0 | 134 | ||||||||||||
Telecommunication Services | 0 | 159 | 0 | 159 | ||||||||||||
Mexico | ||||||||||||||||
Consumer Staples | 73 | 0 | 0 | 73 | ||||||||||||
Netherlands | ||||||||||||||||
Financials | 0 | 377 | 0 | 377 | ||||||||||||
Russia | ||||||||||||||||
Consumer Staples | 47 | 0 | 0 | 47 | ||||||||||||
Spain | ||||||||||||||||
Consumer Staples | 0 | 91 | 0 | 91 | ||||||||||||
Switzerland | ||||||||||||||||
Health Care | 0 | 216 | 0 | 216 | ||||||||||||
Taiwan | ||||||||||||||||
Information Technology | 0 | 171 | 0 | 171 | ||||||||||||
Thailand | ||||||||||||||||
Telecommunication Services | 0 | 42 | 0 | 42 | ||||||||||||
United Kingdom | ||||||||||||||||
Consumer Staples | 0 | 56 | 0 | 56 | ||||||||||||
Energy | 55 | 0 | 0 | 55 | ||||||||||||
Financials | 0 | 559 | 0 | 559 | ||||||||||||
Telecommunication Services | 0 | 235 | 0 | 235 | ||||||||||||
United States | ||||||||||||||||
Energy | 160 | 0 | 0 | 160 | ||||||||||||
Health Care | 217 | 0 | 0 | 217 | ||||||||||||
Industrials | 149 | 0 | 0 | 149 | ||||||||||||
Information Technology | 238 | 0 | 0 | 238 | ||||||||||||
$ | 1,319 | $ | 3,989 | $ | 0 | $ | 5,308 |
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 59 |
Table of Contents
Schedule of Investments PIMCO International Dividend Fund (Cont.)
December 31, 2015 (Unaudited)
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Investments in Affiliates, at Value | ||||||||||||||||
Short-Term Instruments | ||||||||||||||||
Central Funds Used for Cash Management Purposes | $ | 10 | $ | 0 | $ | 0 | $ | 10 | ||||||||
Total Investments | $ | 1,329 | $ | 3,989 | $ | 0 | $ | 5,318 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Financial Derivative Instruments - Assets | ||||||||||||||||
Over the counter | $ | 0 | $ | 6 | $ | 0 | $ | 6 | ||||||||
Financial Derivative Instruments - Liabilities |
| |||||||||||||||
Over the counter | $ | 0 | $ | (14 | ) | $ | 0 | $ | (14 | ) | ||||||
Totals | $ | 1,329 | $ | 3,981 | $ | 0 | $ | 5,310 |
There were assets and liabilities valued at $59 transferred from Level 1 to Level 2 during the period ended December 31, 2015. There were no significant assets and liabilities transferred from Level 2 to Level 1 during the period ended December 31, 2015. There were no significant transfers between Levels 2 and 3 during the period ended December 31, 2015.
60 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
Schedule of Investments PIMCO U.S. Dividend Fund
December 31, 2015 (Unaudited)
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN SECURITIES 96.2% | ||||||||||||
COMMON STOCKS 91.5% | ||||||||||||
SWITZERLAND 4.0% | ||||||||||||
HEALTH CARE 4.0% | ||||||||||||
Roche Holding AG | 844 | $ | 234 | |||||||||
|
| |||||||||||
Total Switzerland | 234 | |||||||||||
|
| |||||||||||
UNITED KINGDOM 1.0% | ||||||||||||
ENERGY 1.0% | ||||||||||||
Golar LNG Partners LP | 4,452 | 59 | ||||||||||
|
| |||||||||||
Total United Kingdom | 59 | |||||||||||
|
| |||||||||||
UNITED STATES 86.5% | ||||||||||||
CONSUMER DISCRETIONARY 16.2% | ||||||||||||
Comcast Corp. ‘A’ | 5,085 | 287 | ||||||||||
General Motors Co. | 6,737 | 229 | ||||||||||
Kohl’s Corp. | 1,854 | 88 | ||||||||||
Macy’s, Inc. | 2,474 | 87 | ||||||||||
SeaWorld Entertainment, Inc. | 4,373 | 86 | ||||||||||
Time Warner, Inc. | 2,715 | 176 | ||||||||||
|
| |||||||||||
953 | ||||||||||||
|
| |||||||||||
ENERGY 2.9% | ||||||||||||
Schlumberger Ltd. | 2,478 | 173 | ||||||||||
|
| |||||||||||
FINANCIALS 10.6% | ||||||||||||
Blackstone Group LP | 4,750 | 139 | ||||||||||
JPMorgan Chase & Co. | 1,782 | 118 | ||||||||||
Navient Corp. | 4,538 | 52 | ||||||||||
Prudential Financial, Inc. | 2,051 | 167 | ||||||||||
Regions Financial Corp. | 15,005 | 144 | ||||||||||
|
| |||||||||||
620 | ||||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
HEALTH CARE 13.5% | ||||||||||||
AbbVie, Inc. | 4,485 | $ | 266 | |||||||||
Merck & Co., Inc. | 4,566 | 241 | ||||||||||
Pfizer, Inc. | 8,932 | 288 | ||||||||||
|
| |||||||||||
795 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 7.9% | ||||||||||||
Neilsen Holdings PLC | 6,155 | 287 | ||||||||||
Quad/Graphics, Inc. | 3,090 | 28 | ||||||||||
RR Donnelley & Sons Co. | 9,905 | 146 | ||||||||||
|
| |||||||||||
461 | ||||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 15.7% | ||||||||||||
Apple, Inc. | 2,427 | 255 | ||||||||||
Cisco Systems, Inc. | 7,506 | 204 | ||||||||||
QUALCOMM, Inc. | 5,880 | 294 | ||||||||||
Western Digital Corp. | 2,856 | 172 | ||||||||||
|
| |||||||||||
925 | ||||||||||||
|
| |||||||||||
MATERIALS 5.4% | ||||||||||||
International Paper Co. | 5,295 | 199 | ||||||||||
Steel Dynamics, Inc. | 6,533 | 117 | ||||||||||
|
| |||||||||||
316 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 9.4% | ||||||||||||
AT&T, Inc. | 9,248 | 318 | ||||||||||
CenturyLink, Inc. | 9,212 | 232 | ||||||||||
|
| |||||||||||
550 | ||||||||||||
|
| |||||||||||
UTILITIES 4.9% | ||||||||||||
PG&E Corp. | 5,401 | 287 | ||||||||||
|
| |||||||||||
Total United States | 5,080 | |||||||||||
|
| |||||||||||
Total Common Stocks (Cost $5,659) | 5,373 | |||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
REAL ESTATE INVESTMENT TRUSTS 4.7% | ||||||||||||
UNITED STATES 4.7% | ||||||||||||
FINANCIALS 4.7% | ||||||||||||
Colony Capital, Inc. ‘A’ | 8,613 | $ | 168 | |||||||||
Outfront Media, Inc. | 5,027 | 110 | ||||||||||
|
| |||||||||||
278 | ||||||||||||
|
| |||||||||||
Total Real Estate Investment Trusts | 278 | |||||||||||
|
| |||||||||||
Total Investments in Securities (Cost $5,991) | 5,651 | |||||||||||
|
| |||||||||||
INVESTMENTS IN AFFILIATES 2.4% | ||||||||||||
SHORT-TERM INSTRUMENTS 2.4% | ||||||||||||
CENTRAL FUNDS USED FOR CASH MANAGEMENT PURPOSES 2.4% | ||||||||||||
PIMCO Short-Term | 14,217 | 140 | ||||||||||
|
| |||||||||||
Total Short-Term Instruments (Cost $140) | 140 | |||||||||||
|
| |||||||||||
Total Investments in Affiliates (Cost $140) | 140 | |||||||||||
Total Investments 98.6% (Cost $6,131) | $ | 5,791 | ||||||||||
Financial Derivative (Cost or Premiums, net $0) | (1 | ) | ||||||||||
Other Assets and Liabilities, net 1.4% | 81 | |||||||||||
|
| |||||||||||
Net Assets 100.0% | $ | 5,871 | ||||||||||
|
|
NOTES TO SCHEDULE OF INVESTMENTS (AMOUNTS IN THOUSANDS*, EXCEPT NUMBER OF CONTRACTS):
* | A zero balance may reflect actual amounts rounding to less than one thousand. |
(a) FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED
FUTURES CONTRACTS:
Description | Type | Expiration Month | # of Contracts | Unrealized (Depreciation) | Variation Margin | |||||||||||||||||
Asset | Liability | |||||||||||||||||||||
E-mini S&P 500 Index March Futures | Long | 03/2016 | 1 | $ | (1 | ) | $ | 0 | $ | (1 | ) | |||||||||||
|
|
|
|
|
| |||||||||||||||||
Total Futures Contracts | $ | (1 | ) | $ | 0 | $ | (1 | ) | ||||||||||||||
|
|
|
|
|
|
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 61 |
Table of Contents
Schedule of Investments PIMCO U.S. Dividend Fund (Cont.)
December 31, 2015 (Unaudited)
FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED SUMMARY
The following is a summary of the market value and variation margin of Exchange-Traded or Centrally Cleared Financial Derivative Instruments as of December 31, 2015:
Cash of $19 has been pledged as collateral for exchange-traded and centrally cleared financial derivative instruments as of December 31, 2015. See Note 7, Principal Risks, in the Notes to Financial Statements for more information regarding master netting arrangements.
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||
Market Value | Variation Margin Asset | Total | Market Value | Variation Margin Liability | Total | |||||||||||||||||||||||||||||
Purchased Options | Futures | Swap Agreements | Written Options | Futures | Swap Agreements | |||||||||||||||||||||||||||||
Total Exchange-Traded or Centrally Cleared | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ (1) | $ | 0 | $ (1) | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
FAIR VALUE OF FINANCIAL DERIVATIVE INSTRUMENTS
The following is a summary of the fair valuation of the Fund’s derivative instruments categorized by risk exposure. See Note 7, Principal Risks, in the Notes to Financial Statements on risks of the Fund.
Fair Values of Financial Derivative Instruments on the Statements of Assets and Liabilities as of December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Financial Derivative Instruments - Liabilities | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Futures | $ | 0 | $ | 0 | $ | 1 | $ | 0 | $ | 0 | $ | 1 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
The effect of Financial Derivative Instruments on the Statements of Operations for the period ended December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Net Realized (Loss) on Financial Derivative Instruments | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Futures | $ | 0 | $ | 0 | $ | (1 | ) | $ | 0 | $ | 0 | $ | (1 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Net Change in Unrealized (Depreciation) on Financial Derivative Instruments |
| |||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Futures | $ | 0 | $ | 0 | $ | (1 | ) | $ | 0 | $ | 0 | $ | (1 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
FAIR VALUE MEASUREMENTS
The following is a summary of the fair valuations according to the inputs used as of December 31, 2015 in valuing the Fund’s assets and liabilities:
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Investments in Securities, at Value |
| |||||||||||||||
Common Stocks | ||||||||||||||||
Switzerland | ||||||||||||||||
Health Care | $ | 0 | $ | 234 | $ | 0 | $ | 234 | ||||||||
United Kingdom | ||||||||||||||||
Energy | 59 | 0 | 0 | 59 | ||||||||||||
United States | ||||||||||||||||
Consumer Discretionary | 953 | 0 | 0 | 953 | ||||||||||||
Energy | 173 | 0 | 0 | 173 | ||||||||||||
Financials | 620 | 0 | 0 | 620 | ||||||||||||
Health Care | 795 | 0 | 0 | 795 | ||||||||||||
Industrials | 461 | 0 | 0 | 461 | ||||||||||||
Information Technology | 925 | 0 | 0 | 925 | ||||||||||||
Materials | 316 | 0 | 0 | 316 | ||||||||||||
Telecommunication Services | 550 | 0 | 0 | 550 | ||||||||||||
Utilities | 287 | 0 | 0 | 287 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Real Estate Investment Trusts | ||||||||||||||||
United States | ||||||||||||||||
Financials | $ | 278 | $ | 0 | $ | 0 | $ | 278 | ||||||||
$ | 5,417 | $ | 234 | $ | 0 | $ | 5,651 | |||||||||
Investments in Affiliates, at Value | ||||||||||||||||
Short-Term Instruments | ||||||||||||||||
Central Funds Used for Cash Management Purposes | 140 | 0 | 0 | 140 | ||||||||||||
Total Investments | $ | 5,557 | $ | 234 | $ | 0 | $ | 5,791 | ||||||||
Financial Derivative Instruments - Liabilities |
| |||||||||||||||
Exchange-traded or centrally cleared | $ | (1 | ) | $ | 0 | $ | 0 | $ | (1 | ) | ||||||
Totals | $ | 5,556 | $ | 234 | $ | 0 | $ | 5,790 |
There were no significant transfers between Levels 1, 2, or 3 during the period ended December 31, 2015.
62 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
1. ORGANIZATION
PIMCO Equity Series (the “Trust”) was established as a Delaware statutory trust on December 28, 2009. The Trust is registered under the Investment Company Act of 1940, as amended (the “Act”), as an open-end management investment company. Information presented in these financial statements pertains to the Institutional Class, Class P, Class D, Class A, Class C and Class R shares of the funds (each a “Fund” and collectively the “Funds”) indicated on the cover of this report. Pacific Investment Management Company LLC (“PIMCO”) serves as the investment adviser (the “Adviser”) for the Funds.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently followed by the Trust in the preparation of its financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Each Fund is treated as an investment company under the reporting requirements of U.S. GAAP. The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.
(a) Securities Transactions and Investment Income Securities transactions are recorded as of the trade date for financial reporting purposes. Securities purchased or sold on a when-issued or delayed-delivery basis may be settled 15 days or more after the trade date. Realized gains and losses from securities sold are recorded on the identified cost basis. Dividend income is recorded on the ex-dividend date, except certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Fund is informed of the ex-dividend date. Interest income, adjusted for the accretion of discounts and amortization of premiums, is recorded on the accrual basis from settlement date, with the exception of securities with a forward starting effective date, where interest income is recorded on the accrual basis from effective date. For convertible securities, premiums attributable to the conversion feature are not amortized. Estimated tax liabilities on certain foreign securities are recorded on an accrual basis and are reflected as components of interest income or net change in unrealized appreciation (depreciation) on investments on the Statements of Operations, as appropriate. Tax liabilities realized as a result of such security sales are reflected as a component of net realized gain (loss) on investments on the Statements of Operations. Paydown gains and losses on mortgage-related and other asset-backed securities are recorded as components of interest income on the Statements of Operations. Income or short-term capital
gain distributions received from registered investment companies are recorded as dividend income. Long-term capital gain distributions received from registered investment companies are recorded as realized gains.
Debt obligations may be placed on non-accrual status and related interest income may be reduced by ceasing current accruals and writing off interest receivable when the collection of all or a portion of interest has become doubtful based on consistently applied procedures. A debt obligation is removed from non-accrual status when the issuer resumes interest payments or when collectability of interest is probable.
(b) Cash and Foreign Currency The functional and reporting currency for the Funds is the U.S. dollar. The market values of foreign securities, currency holdings and other assets and liabilities are translated into U.S. dollars based on the current exchange rates each business day. Purchases and sales of securities and income and expense items denominated in foreign currencies, if any, are translated into U.S. dollars at the exchange rate in effect on the transaction date. The Funds do not separately report the effects of changes in foreign exchange rates from changes in market prices on securities held. Such changes are included in net realized gain (loss) and net change in unrealized appreciation (depreciation) from investments on the Statements of Operations. The Funds may invest in foreign currency-denominated securities and may engage in foreign currency transactions either on a spot (cash) basis at the rate prevailing in the currency exchange market at the time or through a forward foreign currency contract (see Financial Derivative Instruments, if any). Realized foreign exchange gains or losses arising from sales of spot foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions and the difference between the recorded amounts of dividends, interest, and foreign withholding taxes and the U.S. dollar equivalent of the amounts actually received or paid are included in net realized gain (loss) on foreign currency transactions on the Statements of Operations. Net unrealized foreign exchange gains and losses arising from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period are included in net change in unrealized appreciation (depreciation) on foreign currency assets and liabilities on the Statements of Operations.
(c) Multiclass Operations Each class offered by the Trust has equal rights as to assets and voting privileges (except that shareholders of a class have exclusive voting rights regarding any matter relating solely to that class of shares). Income and non-class specific expenses are allocated daily to each class on the basis of the relative net assets. Realized and unrealized capital gains and losses are allocated daily based on the relative net assets of each class of the respective Fund. Class specific expenses, where applicable, currently include supervisory
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 63 |
Table of Contents
Notes to Financial Statements (Cont.)
and administrative and distribution and servicing fees. Under certain circumstances, the per share net asset value (“NAV”) of a class of the respective Fund’s shares may be different from the per share NAV of another class of shares as a result of the different daily expense accruals applicable to each class of shares.
(d) Dividends and Distributions to Shareholders Dividends from net investment income, if any, of the PIMCO EqS® Long/Short Fund, are declared and distributed to shareholders annually. Dividends from net investment income, if any, of each Fund, except the PIMCO EqS® Long/Short Fund are declared daily and distributed to shareholders quarterly. Net realized capital gains earned by each Fund, if any, will be distributed no less frequently than once each year.
Income dividends and capital gain distributions are determined in accordance with income tax regulations which may differ from U.S. GAAP. Differences between tax regulations and U.S. GAAP may cause timing differences between income and capital gain recognition. Examples of events that give rise to timing differences include wash sales, straddles and capital loss carryforwards. Further, the character of investment income and capital gains may be different for certain transactions under the two methods of accounting. Examples of transactions that may cause character differences include the treatment of paydowns on mortgage-backed securities, swaps, foreign currency transactions and contingent debt instruments. As a result, income dividends and capital gain distributions declared during a fiscal period may differ significantly from the net investment income (loss) and realized gains (losses) reported on each Fund’s annual financial statements presented under U.S. GAAP.
Distributions classified as a tax basis return of capital, if any, are reflected on the Statements of Changes in Net Assets and have been recorded to paid in capital. In addition, other amounts have been reclassified between undistributed (overdistributed) net investment income (loss), accumulated undistributed (overdistributed) net realized gains (losses) and/or paid in capital to more appropriately conform financial accounting to tax characterizations of dividend distributions.
(e) Statements of Cash Flows U.S. GAAP requires entities providing financial statements that report both financial position and results of operations to also provide a Statement of Cash Flows for each period for which results of operations are provided, but exempts investment companies meeting certain conditions. One of the conditions is that substantially all of the enterprise’s investments were carried at fair value during the period and classified as Level 1 or Level 2 in the fair value hierarchy in accordance with the requirements of U.S. GAAP. Another condition is that the enterprise had little or no debt, based on the average debt outstanding during the period, in relation to average total assets. Funds with certain degrees of borrowing activity, typically
through the use of reverse repurchase agreements or sale-buyback transactions, or a line of credit, have been determined to be at a level requiring a Statement of Cash Flows. Statements of Cash Flows, as applicable, have been prepared using the indirect method which requires net increase (decrease) in net assets resulting from operations to be adjusted to reconcile to net cash flows from operating activities.
(f) New Accounting Pronouncements In June 2014, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standards Update (“ASU”), ASU 2014-11, that expanded secured borrowing accounting for certain repurchase agreements. The ASU also sets forth additional disclosure requirements for certain transactions accounted for as sales in order to provide financial statement users with information to compare to similar transactions accounted for as secured borrowings. The ASU became effective prospectively for annual periods beginning after December 15, 2014, and interim periods beginning after March 15, 2015. The Funds have adopted the ASU. The financial statements have been modified to provide enhanced disclosures surrounding secured borrowing transactions, if any. See the Notes to Schedules of Investments for additional details.
In August 2014, the FASB issued ASU 2014-15 requiring management to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern. The ASU is effective prospectively for annual periods ending after December 15, 2016, and interim periods thereafter. At this time, management is evaluating the implications of these changes on the financial statements.
In May 2015, the FASB issued ASU 2015-07 which removes the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the NAV per share practical expedient. The ASU also removes the requirement to make certain disclosures for all investments that are eligible to be measured at fair value using the NAV per share practical expedient. The ASU is effective for annual periods beginning after December 15, 2015 and interim periods within those annual periods. At this time, management is evaluating the implications of these changes on the financial statements.
3. INVESTMENT VALUATION AND FAIR VALUE MEASUREMENTS
(a) Investment Valuation Policies The price of a Fund’s shares is based on the Fund’s NAV. The NAV of a Fund, or each of its share classes, as applicable, is determined by dividing the total value of portfolio investments and other assets attributable to that Fund or class, less any liabilities, by the total number of shares outstanding of that Fund or class. On each day that the New York Stock Exchange (“NYSE”) is open, Fund shares are ordinarily valued as of the close of
64 | PIMCO EQUITY SERIES |
Table of Contents
December 31, 2015 (Unaudited)
regular trading (“NYSE Close”). Information that becomes known to the Funds or their agents after the time as of which NAV has been calculated on a particular day will not generally be used to retroactively adjust the price of a security or the NAV determined earlier that day. Each Fund reserves the right to change the time its respective NAV is calculated if the Fund closes earlier, or as permitted by the SEC.
For purposes of calculating NAV, portfolio securities and other assets for which market quotes are readily available are valued at market value. Market value is generally determined on the basis of official closing prices or the last reported sales prices, or if no sales are reported, based on quotes obtained from established market makers or prices (including evaluated prices) supplied by the Funds’ approved pricing services, quotation reporting systems and other third-party sources (together, “Pricing Services”). The Funds will normally use pricing data for domestic equity securities received shortly after the NYSE Close and do not normally take into account trading, clearances or settlements that take place after the NYSE Close. A foreign (non-U.S.) equity security traded on a foreign exchange or on more than one exchange is typically valued using pricing information from the exchange considered by the Adviser to be the primary exchange. A foreign (non-U.S.) equity security will be valued as of the close of trading on the foreign exchange, or the NYSE Close, if the NYSE Close occurs before the end of trading on the foreign exchange. Domestic and foreign (non-U.S.) fixed income securities, non-exchange traded derivatives, and equity options are normally valued on the basis of quotes obtained from brokers and dealers or Pricing Services using data reflecting the earlier closing of the principal markets for those securities. Prices obtained from Pricing Services may be based on, among other things, information provided by market makers or estimates of market values obtained from yield data relating to investments or securities with similar characteristics. Certain fixed income securities purchased on a delayed-delivery basis are marked to market daily until settlement at the forward settlement date. Exchange-traded options, except equity options, futures and options on futures are valued at the settlement price determined by the relevant exchange. Swap agreements are valued on the basis of bid quotes obtained from brokers and dealers or market-based prices supplied by Pricing Services or other pricing sources. With respect to any portion of the Fund’s assets that are invested in one or more open-end management investment companies (other than exchange-traded funds (“ETFs”)), a Fund’s NAV will be calculated based upon the NAVs of such investments.
If a foreign (non-U.S.) equity security’s value has materially changed after the close of the security’s primary exchange or principal market but before the NYSE Close, the security may be valued at fair value based on procedures established and approved by the Board of
Trustees of the Trust (the “Board”). Foreign (non-U.S.) equity securities that do not trade when the NYSE is open are also valued at fair value. With respect to foreign (non-U.S.) equity securities, the Fund may determine the fair value of investments based on information provided by Pricing Services and other third-party vendors, which may recommend fair value or adjustments with reference to other securities, indices or assets. In considering whether fair valuation is required and in determining fair values, the Fund may, among other things, consider significant events (which may be considered to include changes in the value of U.S. securities or securities indices) that occur after the close of the relevant market and before the NYSE Close. A Fund may utilize modeling tools provided by third-party vendors to determine fair values of non-U.S. securities. Foreign (non-U.S.) exchanges may permit trading in foreign (non-U.S.) equity securities on days when the Trust is not open for business, which may result in a Fund’s portfolio investments being affected when shareholders are unable to buy or sell shares.
Senior secured floating rate loans for which an active secondary market exists to a reliable degree will be valued at the mean of the last available bid/ask prices in the market for such loans, as provided by a Pricing Service. Senior secured floating rate loans for which an active secondary market does not exist to a reliable degree will be valued at fair value, which is intended to approximate market value. In valuing a senior secured floating rate loan at fair value, the factors considered may include, but are not limited to, the following: (a) the creditworthiness of the borrower and any intermediate participants, (b) the terms of the loan, (c) recent prices in the market for similar loans, if any, and (d) recent prices in the market for instruments of similar quality, rate, period until next interest rate reset and maturity.
Investments valued in currencies other than the U.S. dollar are converted to the U.S. dollar using exchange rates obtained from Pricing Services. As a result, the value of such investments and, in turn, the NAV of the Fund’s shares may be affected by changes in the value of currencies in relation to the U.S. dollar. The value of investments traded in markets outside the United States or denominated in currencies other than the U.S. dollar may be affected significantly on a day that the Trust is not open for business. As a result, to the extent that a Fund holds foreign (non-U.S.) investments, the value of those investments may change at times when shareholders are unable to buy or sell shares and the value of such investments will be reflected in the Fund’s next calculated NAV.
Investments for which market quotes or market based valuations are not readily available are valued at fair value as determined in good faith by the Board or persons acting at their direction. The Board has adopted methods for valuing securities and other assets in circumstances where market quotes are not readily available, and has delegated to the Adviser the responsibility for applying the fair
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valuation methods. In the event that market quotes or market based valuations are not readily available, and the security or asset cannot be valued pursuant to a Board approved valuation method, the value of the security or asset will be determined in good faith by the Valuation Oversight Committee of the Board (“Valuation Oversight Committee”), generally based on recommendations provided by the Adviser. Market quotes are considered not readily available in circumstances where there is an absence of current or reliable market-based data (e.g., trade information, bid/ask information, indicative market quotations (“Broker Quotes”), Pricing Services’ prices), including where events occur after the close of the relevant market, but prior to the NYSE Close, that materially affect the values of a Fund’s securities or assets. In addition, market quotes are considered not readily available when, due to extraordinary circumstances, the exchanges or markets on which the securities trade do not open for trading for the entire day and no other market prices are available. The Board has delegated to the Adviser the responsibility for monitoring significant events that may materially affect the values of the Fund’s securities or assets and for determining whether the value of the applicable securities or assets should be reevaluated in light of such significant events.
When a Fund uses fair valuation to determine the value of a portfolio security or other asset for purposes of calculating its NAV, such investments will not be priced on the basis of quotes from the primary market in which they are traded, but rather may be priced by another method that the Board or persons acting at their direction believe reflects fair value. Fair valuation may require subjective determinations about the value of a security. While the Trust’s policy is intended to result in a calculation of the Fund’s NAV that fairly reflects security values as of the time of pricing, the Trust cannot ensure that fair values determined by the Board or persons acting at their direction would accurately reflect the price that a Fund could obtain for a security if it were to dispose of that security as of the time of pricing (for instance, in a forced or distressed sale). The prices used by a Fund may differ from the value that would be realized if the securities were sold. The Funds’ use of fair valuation may also help to deter “stale price arbitrage” as discussed under the “Abusive Trading Practices” section in each Fund’s prospectus.
(b) Fair Value Hierarchy U.S. GAAP describes fair value as the price that a Fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. It establishes a fair value hierarchy that prioritizes inputs to valuation methods and requires disclosure of the fair value hierarchy, separately for each major category of assets and liabilities, that segregates fair value measurements into levels (Level 1, 2, or 3). The inputs or methodology used for valuing securities are not necessarily an indication of the risks associated with investing in
those securities. Levels 1, 2, and 3 of the fair value hierarchy are defined as follows:
n | Level 1 — Inputs using (unadjusted) quoted prices in active markets or exchanges for identical assets and liabilities. |
n | Level 2 — Significant other observable inputs, which may include, but are not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market corroborated inputs. |
n | Level 3 — Significant unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available, which may include assumptions made by the Board or persons acting at their direction that are used in determining the fair value of investments. |
In accordance with the requirements of U.S. GAAP, the amounts of transfers between Levels 1 and 2 and transfers in and out of Level 3, if material, are disclosed in the Notes to Schedules of Investments for each respective Fund.
For fair valuations using significant unobservable inputs, U.S. GAAP requires a reconciliation of the beginning to ending balances for reported fair values that presents changes attributable to realized gain (loss), unrealized appreciation (depreciation), purchases and sales, accrued discounts (premiums), and transfers in and out of the Level 3 category during the period. The end of period timing recognition is used for the transfers between Levels of a Fund’s assets and liabilities. Additionally, U.S. GAAP requires quantitative information regarding the significant unobservable inputs used in the determination of fair value of assets or liabilities categorized as Level 3 in the fair value hierarchy. In accordance with the requirements of U.S. GAAP, a fair value hierarchy, and if material, a Level 3 reconciliation and details of significant unobservable inputs, have been included in the Notes to Schedules of Investments for each respective Fund.
(c) Valuation Techniques and the Fair Value Hierarchy
Level 1 and Level 2 trading assets and trading liabilities, at fair value The valuation methods (or “techniques”) and significant inputs used in determining the fair values of portfolio securities or other assets and liabilities categorized as Level 1 and Level 2 of the fair value hierarchy are as follows:
Fixed income securities including corporate, convertible and municipal bonds and notes, U.S. government agencies, U.S. treasury obligations, sovereign issues, bank loans, convertible preferred securities and
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non-U.S. bonds are normally valued on the basis of quotes obtained from brokers and dealers or Pricing Services that use broker-dealer quotations, reported trades or valuation estimates from their internal pricing models. The Pricing Services’ internal models use inputs that are observable such as issuer details, interest rates, yield curves, prepayment speeds, credit risks/spreads, default rates and quoted prices for similar assets. Securities that use similar valuation techniques and inputs as described above are categorized as Level 2 of the fair value hierarchy.
Fixed income securities purchased on a delayed-delivery basis or as a repurchase commitment in a sale-buyback transaction are marked to market daily until settlement at the forward settlement date and are categorized as Level 2 of the fair value hierarchy.
Mortgage-related and asset-backed securities are usually issued as separate tranches, or classes, of securities within each deal. These securities are also normally valued by Pricing Services that use broker-dealer quotations, reported trades or valuation estimates from their internal pricing models. The pricing models for these securities usually consider tranche-level attributes, current market data, estimated cash flows and market-based yield spreads for each tranche, and incorporate deal collateral performance, as available. Mortgage-related and asset-backed securities that use similar valuation techniques and inputs as described above are categorized as Level 2 of the fair value hierarchy.
Common stocks, ETFs, exchange-traded notes and financial derivative instruments, such as futures contracts, rights and warrants, or options on futures that are traded on a national securities exchange, are stated at the last reported sale or settlement price on the day of valuation. To the extent these securities are actively traded and valuation adjustments are not applied, they are categorized as Level 1 of the fair value hierarchy.
Valuation adjustments may be applied to certain securities that are solely traded on a foreign exchange to account for the market movement between the close of the foreign market and the NYSE Close. These securities are valued using Pricing Services that consider the correlation of the trading patterns of the foreign security to the intraday trading in the U.S. markets for investments. Securities using these valuation adjustments are categorized as Level 2 of the fair value hierarchy. Preferred securities and other equities traded on inactive markets or valued by reference to similar instruments are also categorized as Level 2 of the fair value hierarchy.
Equity-linked securities are valued by referencing the last reported sale or settlement price of the linked referenced equity on the day of valuation. Foreign exchange adjustments are applied to the last reported price to convert the linked equity’s trading currency to the
contract’s settling currency. These investments are categorized as Level 2 of the fair value hierarchy.
Investments in registered open-end investment companies (other than ETFs) will be valued based upon the NAVs of such investments and are categorized as Level 1 of the fair value hierarchy. Investments in unregistered open-end investment companies will be calculated based upon the NAVs of such investments and are considered Level 1 provided that the NAVs are observable, calculated daily and are the value at which both purchases and sales will be conducted. Investments in privately held investment funds with significant restrictions on redemption where the inputs to the NAVs are observable will be valued based upon the NAVs of such investments and are categorized as Level 2 of the fair value hierarchy.
Short-term debt instruments (such as commercial paper) having a remaining maturity of 60 days or less may be valued at amortized cost, so long as the amortized cost of such short-term debt instrument is approximately the same as the fair value of the instrument as determined without the use of amortized cost valuation. Prior to July 31, 2015, short-term investments having a maturity of 60 days or less and repurchase agreements were generally valued at amortized cost which approximates fair value. Short-term debt instruments having a remaining maturity of 60 days or less are categorized as Level 2 of the fair value hierarchy.
Equity exchange-traded options and over the counter financial derivative instruments, such as foreign currency contracts, options contracts, or swap agreements, derive their value from underlying asset prices, indices, reference rates, and other inputs or a combination of these factors. Other than swap agreements, which are valued using a broker-dealer bid quotation or on market-based prices provided by Pricing Services or other pricing sources, these contracts are normally valued on the basis of quotes obtained from a quotation reporting system, established market makers or Pricing Services (normally determined as of the NYSE Close). Depending on the product and the terms of the transaction, financial derivative instruments can be valued by Pricing Services using a series of techniques, including simulation pricing models. The pricing models use inputs that are observed from actively quoted markets such as quoted prices, issuer details, indices, bid/ask spreads, interest rates, implied volatilities, yield curves, dividends and exchange rates. Financial derivative instruments that use similar valuation techniques and inputs as described above are categorized as Level 2 of the fair value hierarchy.
Centrally cleared swaps listed or traded on a multilateral or trade facility platform, such as a registered exchange, are valued at the daily settlement price determined by the respective exchange (if available). For centrally cleared credit default swaps, the clearing facility requires
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its members to provide actionable price levels across complete term structures. These levels along with external third-party prices are used to produce daily settlement prices. These securities are categorized as Level 2 of the fair value hierarchy. Centrally cleared interest rate swaps are valued using a pricing model that references the underlying rates including the overnight index swap rate and London Interbank Offered Rate (“LIBOR”) forward rate to produce the daily settlement price. These securities are categorized as Level 2 of the fair value hierarchy.
Level 3 trading assets and trading liabilities, at fair value When a fair valuation method is applied by the Adviser that uses significant unobservable inputs, investments will be priced by a method that the Board or persons acting at their direction believe reflects fair value and are categorized as Level 3 of the fair value hierarchy.
The validity of the fair value is reviewed by the Adviser on a periodic basis and may be amended in accordance with the Trust’s valuation procedures.
4. SECURITIES AND OTHER INVESTMENTS
(a) Investments in Affiliates
Each Fund may invest in the PIMCO Short-Term Floating NAV Portfolio III (“Central Fund”) to the extent permitted by the Act and rules thereunder. The Central Fund is a registered investment company created for use solely by the series of the Trust and other series of registered investment companies advised by the Adviser, in connection with their cash management activities. The main investments of the Central Fund are money market and short maturity fixed income instruments. The Central Fund may incur expenses related to its investment activities, but does not pay Investment Advisory Fees or Supervisory and Administrative Fees to the Adviser. The Central Fund is considered to be affiliated with the Funds. The table below shows the Funds’ transactions in and earnings from investments in the affiliated Central Fund for the period ended December 31, 2015 (amounts in thousands†):
Investments in PIMCO Short-Term Floating NAV Portfolio III
Fund Name | Market Value 06/30/2015 | Purchases at Cost | Proceeds from Sales | Net Realized Gain (Loss) | Change in Unrealized Appreciation (Depreciation) | Market Value 12/31/2015 | Dividend Income (1) | Realized Net Capital Gain Distributions (1) | ||||||||||||||||||||||||||
PIMCO Balanced Income Fund | $ | 1,974 | $ | 6,013 | $ | (6,200 | ) | $ | (4 | ) | $ | (5 | ) | $ | 1,778 | $ | 14 | $ | 0 | |||||||||||||||
PIMCO Dividend and Income Builder Fund | 32,430 | 203,383 | (230,950 | ) | (63 | ) | 0 | 4,800 | 83 | 0 | ||||||||||||||||||||||||
PIMCO EqS® Long/Short Fund | 122,481 | 981,050 | (796,400 | ) | (142 | ) | (1,213 | ) | 305,776 | 1,950 | 0 | |||||||||||||||||||||||
PIMCO Global Dividend Fund | 3,024 | 28,105 | (29,875 | ) | (1 | ) | 0 | 1,253 | 5 | 0 | ||||||||||||||||||||||||
PIMCO International Dividend Fund | 110 | 400 | (500 | ) | 0 | 0 | 10 | 0 | 0 | |||||||||||||||||||||||||
PIMCO U.S. Dividend Fund | 10 | 1,002 | (870 | ) | (2 | ) | 0 | 140 | 2 | 0 |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
(1) | A portion of this may be recharacterized to return of capital and reflected as such on tax forms mailed to shareholders on or about January 31st following each calendar year. |
(b) Investments in Securities
Inflation-Indexed Bonds Certain Funds may invest in inflation-indexed bonds. Inflation-indexed bonds are fixed income securities whose principal value is periodically adjusted to the rate of inflation. The interest rate on these bonds is generally fixed at issuance at a rate lower than typical bonds. Over the life of an inflation-indexed bond, however, interest will be paid based on a principal value which is adjusted for inflation. Any increase or decrease in the principal amount of an inflation-indexed bond will be included as interest income on the Statements of Operations, even though investors do not receive their principal until maturity.
Loan Participations, Assignments and Originations Certain Funds may invest in direct debt instruments which are interests in amounts owed to lenders or lending syndicates by corporate, governmental, or other borrowers. A Fund’s investments in loans may be in the form of participations in loans or assignments of all or a portion of loans from
third parties or investments in or originations of loans by a Fund or Funds. A loan is often administered by a bank or other financial institution (the “lender”) that acts as agent for all holders. The agent administers the terms of the loan, as specified in the loan agreement. A Fund may invest in multiple series or tranches of a loan, which may have varying terms and carry different associated risks. When a Fund purchases assignments from lenders it acquires direct rights against the borrowers of the loans. These loans may include participations in bridge loans, which are loans taken out by borrowers for a short period (typically less than one year) pending arrangement of more permanent financing through, for example, the issuance of bonds, frequently high yield bonds issued for the purpose of acquisitions.
The types of loans and related investments in which the Funds may invest include, among others, senior loans, subordinated loans (including second lien loans, B-Notes and mezzanine loans), whole loans, commercial real estate and other commercial loans and
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structured loans. The Funds may originate loans or acquire direct interests in loans through primary loan distributions and/or in private transactions. In the case of subordinated loans, there may be significant indebtedness ranking ahead of the borrower’s obligation to the holder of such a loan, including in the event of the borrower’s insolvency. Mezzanine loans are typically secured by a pledge of an equity interest in the mortgage borrower that owns the real estate rather than an interest in a mortgage.
Investments in loans may include unfunded loan commitments, which are contractual obligations for funding. Unfunded loan commitments may include revolving credit facilities, which may obligate a Fund to supply additional cash to the borrower on demand. Unfunded loan commitments represent a future obligation in full, even though a percentage of the committed amount may not be utilized by the borrower. When investing in a loan participation, a Fund has the right to receive payments of principal, interest and any fees to which it is entitled only from the lender selling the loan agreement and only upon receipt of payments by the lender from the borrower. A Fund may receive a commitment fee based on the undrawn portion of the underlying line of credit portion of a loan. In certain circumstances, a Fund may receive a penalty fee upon the prepayment of a loan by a borrower. Fees earned or paid are recorded as a component of interest income or interest expense, respectively, on the Statements of Operations. As of December 31, 2015, the Funds had no unfunded loan commitments outstanding.
Mortgage-Related and Other Asset-Backed Securities Certain Funds may invest in mortgage-related and other asset-backed securities that directly or indirectly represent a participation in, or are secured by and payable from, loans on real property. Mortgage-related securities are created from pools of residential or commercial mortgage loans, including mortgage loans made by savings and loan institutions, mortgage bankers, commercial banks and others. These securities provide a monthly payment which consists of both interest and principal. Interest may be determined by fixed or adjustable rates. The rate of prepayments on underlying mortgages will affect the price and volatility of a mortgage-related security, and may have the effect of shortening or extending the effective duration of the security relative to what was anticipated at the time of purchase. The timely payment of principal and interest of certain mortgage-related securities is guaranteed with the full faith and credit of the U.S. Government. Pools created and guaranteed by non-governmental issuers, including government-sponsored corporations, may be supported by various forms of insurance or guarantees, but there can be no assurance that private insurers or guarantors can meet their obligations under the insurance policies or guarantee arrangements. Many of the risks of investing in mortgage-related securities secured by commercial
mortgage loans reflect the effects of local and other economic conditions on real estate markets, the ability of tenants to make lease payments, and the ability of a property to attract and retain tenants. These securities may be less liquid and may exhibit greater price volatility than other types of mortgage-related or other asset-backed securities. Other asset-backed securities are created from many types of assets, including auto loans, credit card receivables, home equity loans, and student loans.
Collateralized Mortgage Obligations (“CMOs”) are debt obligations of a legal entity that are collateralized by whole mortgage loans or private mortgage bonds and divided into classes. CMOs are structured into multiple classes, often referred to as “tranches,” with each class bearing a different stated maturity and entitled to a different schedule for payments of principal and interest, including prepayments. CMOs may be less liquid and may exhibit greater price volatility than other types of mortgage-related or asset-backed securities.
Payment In-Kind Securities Certain Funds may invest in payment in-kind securities (“PIKs”). PIKs may give the issuer the option at each interest payment date of making interest payments in either cash or additional debt securities. Those additional debt securities usually have the same terms, including maturity dates and interest rates, and associated risks as the original bonds. The daily market quotations of the original bonds may include the accrued interest (referred to as a dirty price) and require a pro rata adjustment from the unrealized appreciation or depreciation on investments to interest receivable on the Statements of Assets and Liabilities.
U.S. Government Agencies or Government-Sponsored Enterprises Certain Funds may invest in securities of U.S. Government agencies or government-sponsored enterprises. U.S. Government securities are obligations of and, in certain cases, guaranteed by, the U.S. Government, its agencies or instrumentalities. Some U.S. Government securities, such as Treasury bills, notes and bonds, and securities guaranteed by the Government National Mortgage Association (“GNMA” or “Ginnie Mae”), are supported by the full faith and credit of the U.S. Government; others, such as those of the Federal Home Loan Banks, are supported by the right of the issuer to borrow from the U.S. Department of the Treasury (the “U.S. Treasury”); and others, such as those of the Federal National Mortgage Association (“FNMA” or “Fannie Mae”), are supported by the discretionary authority of the U.S. Government to purchase the agency’s obligations. U.S. Government securities may include zero coupon securities. Zero coupon securities do not distribute interest on a current basis and tend to be subject to a greater risk than interest-paying securities.
Government-related guarantors (i.e., not backed by the full faith and credit of the U.S. Government) include FNMA and the Federal Home
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Loan Mortgage Corporation (“FHLMC” or “Freddie Mac”). FNMA is a government-sponsored corporation. FNMA purchases conventional (i.e., not insured or guaranteed by any government agency) residential mortgages from a list of approved seller/servicers which include state and federally chartered savings and loan associations, mutual savings banks, commercial banks and credit unions and mortgage bankers. Pass-through securities issued by FNMA are guaranteed as to timely payment of principal and interest by FNMA, but are not backed by the full faith and credit of the U.S. Government. FHLMC issues Participation Certificates (“PCs”), which are pass-through securities, each representing an undivided interest in a pool of residential mortgages. FHLMC guarantees the timely payment of interest and ultimate collection of principal, but PCs are not backed by the full faith and credit of the U.S. Government.
5. BORROWINGS AND OTHER FINANCING TRANSACTIONS
The following disclosures contain information on a Fund’s ability to lend or borrow cash or securities to the extent permitted under the Act, which may be viewed as borrowing or financing transactions by a Fund. The location of these instruments is described below. For a detailed description of credit and counterparty risks that can be associated with borrowings and other financing transactions, please see Note 7, Principal Risks.
(a) Repurchase Agreements Certain Funds may engage in repurchase agreements. Under the terms of a typical repurchase agreement, a Fund takes possession of an underlying debt obligation (collateral) subject to an obligation of the seller to repurchase, and a Fund to resell, the obligation at an agreed-upon price and time. The underlying securities for all repurchase agreements are held in safekeeping at the Fund’s custodian or designated subcustodians under tri-party repurchase agreements. The market value of the collateral must be equal to or exceed the total amount of the repurchase obligations, including interest. Repurchase agreements, including accrued interest, are included on the Statements of Assets and Liabilities. Interest earned is recorded as a component of interest income on the Statements of Operations. In periods of increased demand for collateral, a Fund may pay a fee for the receipt of collateral, which may result in interest expense to the Fund.
(b) Short Sales Certain Funds may enter into short sales transactions. A short sale is a transaction in which a Fund sells securities it may not own in anticipation of a decline in the fair value of the securities. Securities sold in short sale transactions and the interest payable on such securities, if any, are reflected as a liability on the Statements of Assets and Liabilities. A Fund is obligated to deliver securities at the trade price at the time the short position is covered. Possible losses
from short sales may be unlimited, whereas losses from purchases cannot exceed the total amount invested.
6. FINANCIAL DERIVATIVE INSTRUMENTS
The following disclosures contain information on how and why the Funds use financial derivative instruments, and how financial derivative instruments affect the Funds’ financial position, results of operations and cash flows. The location and fair value amounts of these instruments on the Statements of Assets and Liabilities and the net realized gain (loss) and net change in unrealized appreciation (depreciation) on the Statements of Operations, each categorized by type of financial derivative contract and related risk exposure, are included in a table in the Notes to Schedules of Investments. The financial derivative instruments outstanding as of period end and the amounts of net realized gain (loss) and net change in unrealized appreciation (depreciation) on financial derivative instruments during the period, as disclosed in the Notes to Schedules of Investments, serve as indicators of the volume of financial derivative activity for the Funds.
(a) Forward Foreign Currency Contracts Certain Funds may enter into forward foreign currency contracts in connection with settling planned purchases or sales of securities, to hedge the currency exposure associated with some or all of a Fund’s securities or as a part of an investment strategy. A forward foreign currency contract is an agreement between two parties to buy and sell a currency at a set price on a future date. The market value of a forward foreign currency contract fluctuates with changes in foreign currency exchange rates. Forward foreign currency contracts are marked to market daily, and the change in value is recorded by a Fund as an unrealized gain or loss. Realized gains or losses are equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed and are recorded upon delivery or receipt of the currency. These contracts may involve market risk in excess of the unrealized gain or loss reflected on the Statements of Assets and Liabilities. In addition, a Fund could be exposed to risk if the counterparties are unable to meet the terms of the contracts or if the value of the currency changes unfavorably to the U.S. dollar. To mitigate such risk, cash or securities may be exchanged as collateral pursuant to the terms of the underlying contracts.
(b) Futures Contracts Certain Funds may enter into futures contracts. A Fund may use futures contracts to manage its exposure to the securities markets or to movements in interest rates and currency values. The primary risks associated with the use of futures contracts are the imperfect correlation between the change in market value of the securities held by a Fund and the prices of futures contracts and the possibility of an illiquid market. Futures contracts are valued based upon their quoted daily settlement prices. Upon entering into a futures
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contract, a Fund is required to deposit with its futures broker an amount of cash, U.S. Government and Agency Obligations, or select sovereign debt, in accordance with the initial margin requirements of the broker or exchange. Futures contracts are marked to market daily and based on such movements in the price of the contracts, an appropriate payable or receivable for the change in value may be posted or collected by the Fund (“Futures Variation Margin”). Gains or losses are recognized but not considered realized until the contracts expire or close. Futures contracts involve, to varying degrees, risk of loss in excess of the Futures Variation Margin included within exchange traded or centrally cleared financial derivative instruments on the Statements of Assets and Liabilities.
(c) Options Contracts Certain Funds may write or purchase options to enhance returns or to hedge an existing position or future investment. A Fund may write call and put options on securities and financial derivative instruments they own or in which they may invest. Writing put options tends to increase a Fund’s exposure to the underlying instrument. Writing call options tends to decrease a Fund’s exposure to the underlying instrument. When a Fund writes a call or put, an amount equal to the premium received is recorded as a liability and subsequently marked to market to reflect the current value of the option written. These liabilities are included on the Statements of Assets and Liabilities. Premiums received from writing options which expire are treated as realized gains. Premiums received from writing options which are exercised or closed are added to the proceeds or offset against amounts paid on the underlying futures, swap, security or currency transaction to determine the realized gain or loss. Certain options may be written with premiums to be determined on a future date. The premiums for these options are based upon implied volatility parameters at specified terms. A Fund as a writer of an option has no control over whether the underlying instrument may be sold (“call”) or purchased (“put”) and as a result bears the market risk of an unfavorable change in the price of the instrument underlying the written option. There is the risk a Fund may not be able to enter into a closing transaction because of an illiquid market.
Certain Funds may also purchase put and call options. Purchasing call options tends to increase a Fund’s exposure to the underlying instrument. Purchasing put options tends to decrease a Fund’s exposure to the underlying instrument. A Fund pays a premium which is included as an asset on the Statements of Assets and Liabilities and subsequently marked to market to reflect the current value of the option. Premiums paid for purchasing options which expire are treated as realized losses. Certain options may be purchased with premiums to be determined on a future date. The premiums for these options are based upon implied volatility parameters at specified terms. The risk associated with purchasing put and call options is limited to the
premium paid. Premiums paid for purchasing options which are exercised or closed are added to the amounts paid or offset against the proceeds on the underlying investment transaction to determine the realized gain or loss when the underlying transaction is executed.
Foreign Currency Options Certain Funds may write or purchase foreign currency options. Purchasing foreign currency options gives a Fund the right, but not the obligation to buy or sell the currency with specified amounts of currency and a rate of exchange that may be exercised by a certain date. These options may be used as a short or long hedge against possible variations in foreign exchange rates or to gain exposure to foreign currencies.
(d) Swap Agreements Certain Funds may invest in swap agreements. Swap agreements are bilaterally negotiated agreements between a Fund and a counterparty to exchange or swap investment cash flows, assets, foreign currencies or market-linked returns at specified, future intervals. Swap agreements may be privately negotiated in the over the counter market (“OTC swaps”) or may be cleared through a third party, known as a central counterparty or derivatives clearing organization (“Centrally Cleared Swaps”). A Fund may enter into asset, credit default, cross-currency, interest rate, total return, variance and other forms of swap agreements to manage its exposure to credit, currency, interest rate, commodity, equity and inflation risk. In connection with these agreements, securities or cash may be identified as collateral or margin in accordance with the terms of the respective swap agreements to provide assets of value and recourse in the event of default or bankruptcy/insolvency.
Centrally Cleared Swaps are marked to market daily based upon valuations as determined from the underlying contract or in accordance with the requirements of the central counterparty or derivatives clearing organization. Changes in market value, if any, are reflected as a component of net change in unrealized appreciation (depreciation) on the Statements of Operations. Daily changes in valuation of centrally cleared swaps (“Swap Variation Margin”), if any, are included within centrally cleared financial derivative instruments on the Statements of Assets and Liabilities. OTC swap payments received or paid at the beginning of the measurement period are included on the Statements of Assets and Liabilities and represent premiums paid or received upon entering into the swap agreement to compensate for differences between the stated terms of the swap agreement and prevailing market conditions (credit spreads, currency exchange rates, interest rates, and other relevant factors). Upfront premiums received (paid) are initially recorded as liabilities (assets) and subsequently marked to market to reflect the current value of the swap. These upfront premiums are recorded as realized gains or losses on the Statements of Operations upon termination or maturity of the swap. A liquidation payment received or made at the termination of the swap is recorded
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as realized gain or loss on the Statements of Operations. Net periodic payments received or paid by a Fund are included as part of realized gains or losses on the Statements of Operations.
For purposes of applying a Fund’s investment policies and restrictions, swap agreements are generally valued by a Fund at market value. In the case of a credit default swap (see below), however, in applying certain of a Fund’s investment policies and restrictions, the Funds will value the credit default swap at its notional value or its full exposure value (i.e., the sum of the notional amount for the contract plus the market value), but may value the credit default swap at market value for purposes of applying certain of a Fund’s other investment policies and restrictions. For example, a Fund may value credit default swaps at full exposure value for purposes of a Fund’s credit quality guidelines (if any) because such value reflects a Fund’s actual economic exposure during the term of the credit default swap agreement. In this context, both the notional amount and the market value may be positive or negative depending on whether a Fund is selling or buying protection through the credit default swap. The manner in which certain securities or other instruments are valued by a Fund for purposes of applying investment policies and restrictions may differ from the manner in which those investments are valued by other types of investors.
Entering into these agreements involves, to varying degrees, elements of interest, credit, market and documentation risk in excess of the amounts recognized on the Statements of Assets and Liabilities. Such risks involve the possibility that there will be no liquid market for these agreements, that the counterparty to the agreements may default on its obligation to perform or disagree as to the meaning of contractual terms in the agreements and that there may be unfavorable changes in interest rates.
A Fund’s maximum risk of loss from counterparty credit risk is the discounted net value of the cash flows to be received from the counterparty over the contract’s remaining life, to the extent that amount is positive. The risk is mitigated by having a master netting arrangement between a Fund and the counterparty and by the posting of collateral to a Fund to cover a Fund’s exposure to the counterparty.
Credit Default Swap Agreements A Fund may use credit default swaps on corporate, loan, sovereign, U.S. municipal or U.S. Treasury issues to provide a measure of protection against defaults of the issuers (i.e., to reduce risk where a Fund owns or has exposure to the referenced obligation) or to take an active long or short position with respect to the likelihood of a particular issuer’s default. Credit default swap agreements involve one party making a stream of payments (referred to as the buyer of protection) to another party (the seller of protection) in exchange for the right to receive a specified return in the event that the referenced entity, obligation or index, as specified in the
swap agreement, undergoes a certain credit event. As a seller of protection on credit default swap agreements, a Fund will generally receive from the buyer of protection a fixed rate of income throughout the term of the swap provided that there is no credit event. As the seller, a Fund would effectively add leverage to its portfolio because, in addition to its total net assets, a Fund would be subject to investment exposure on the notional amount of the swap.
If a Fund is a seller of protection and a credit event occurs, as defined under the terms of that particular swap agreement, a Fund will either (i) pay to the buyer of protection an amount equal to the notional amount of the swap and take delivery of the referenced obligation, other deliverable obligations or underlying securities comprising the referenced index or (ii) pay a net settlement amount in the form of cash or securities equal to the notional amount of the swap less the recovery value of the referenced obligation or underlying securities comprising the referenced index. If a Fund is a buyer of protection and a credit event occurs, as defined under the terms of that particular swap agreement, a Fund will either (i) receive from the seller of protection an amount equal to the notional amount of the swap and deliver the referenced obligation, other deliverable obligations or underlying securities comprising the referenced index or (ii) receive a net settlement amount in the form of cash or securities equal to the notional amount of the swap less the recovery value of the referenced obligation or underlying securities comprising the referenced index. Recovery values are estimated by market makers considering either industry standard recovery rates or entity specific factors and considerations until a credit event occurs. If a credit event has occurred, the recovery value is determined by a facilitated auction whereby a minimum number of allowable broker bids, together with a specified valuation method, are used to calculate the settlement value. The ability to deliver other obligations may result in a cheapest-to-deliver option (the buyer of protection’s right to choose the deliverable obligation with the lowest value following a credit event).
Credit default swap agreements on credit indices involve one party making a stream of payments to another party in exchange for the right to receive a specified return in the event of a write-down, principal shortfall, interest shortfall or default of all or part of the referenced entities comprising the credit index. A credit index is a basket of credit instruments or exposures designed to be representative of some part of the credit market as a whole. These indices are made up of reference credits that are judged by a poll of dealers to be the most liquid entities in the credit default swap market based on the sector of the index. Components of the indices may include, but are not limited to, investment grade securities, high yield securities, asset-backed securities, emerging markets, and/or various credit ratings within each sector. Credit indices are traded using credit default swaps with
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standardized terms including a fixed spread and standard maturity dates. An index credit default swap references all the names in the index, and if there is a default, the credit event is settled based on that name’s weight in the index. The composition of the indices changes periodically, usually every six months, and for most indices, each name has an equal weight in the index. A Fund may use credit default swaps on credit indices to hedge a portfolio of credit default swaps or bonds, which is less expensive than it would be to buy many credit default swaps to achieve a similar effect. Credit default swaps on indices are instruments for protecting investors owning bonds against default, and traders use them to speculate on changes in credit quality.
Implied credit spreads, represented in absolute terms, utilized in determining the market value of credit default swap agreements on corporate, loan, sovereign, U.S. municipal or U.S. Treasury issues as of period end, if any, are disclosed in the Notes to Schedules of Investments. They serve as an indicator of the current status of payment/performance risk and represent the likelihood or risk of default for the reference entity. The implied credit spread of a particular referenced entity reflects the cost of buying/selling protection and may include upfront payments required to be made to enter into the agreement. Wider credit spreads represent a deterioration of the referenced entity’s credit soundness and a greater likelihood or risk of default or other credit event occurring as defined under the terms of the agreement. For credit default swap agreements on asset-backed securities and credit indices, the quoted market prices and resulting values serve as the indicator of the current status of the payment/performance risk. Increasing market values, in absolute terms when compared to the notional amount of the swap, represent a deterioration of the referenced entity’s credit soundness and a greater likelihood or risk of default or other credit event occurring as defined under the terms of the agreement.
The maximum potential amount of future payments (undiscounted) that a Fund as a seller of protection could be required to make under a credit default swap agreement equals the notional amount of the agreement. Notional amounts of each individual credit default swap agreement outstanding as of period end for which a Fund is the seller of protection are disclosed in the Notes to Schedules of Investments. These potential amounts would be partially offset by any recovery values of the respective referenced obligations, upfront payments received upon entering into the agreement, or net amounts received from the settlement of buy protection credit default swap agreements entered into by a Fund for the same referenced entity or entities.
Interest Rate Swap Agreements Certain Funds are subject to interest rate risk exposure in the normal course of pursuing their investment objectives. Because a Fund holds fixed rate bonds, the value of these bonds may decrease if interest rates rise. To help hedge against this
risk and to maintain its ability to generate income at prevailing market rates, a Fund may enter into interest rate swap agreements. Interest rate swap agreements involve the exchange by a Fund with another party for their respective commitment to pay or receive interest on the notional amount of principal. Certain forms of interest rate swap agreements may include: (i) interest rate caps, under which, in return for a premium, one party agrees to make payments to the other to the extent that interest rates exceed a specified rate, or “cap”, (ii) interest rate floors, under which, in return for a premium, one party agrees to make payments to the other to the extent that interest rates fall below a specified rate, or “floor”, (iii) interest rate collars, under which a party sells a cap and purchases a floor or vice versa in an attempt to protect itself against interest rate movements exceeding given minimum or maximum levels, (iv) callable interest rate swaps, under which the buyer pays an upfront fee in consideration for the right to early terminate the swap transaction in whole, at zero cost and at a predetermined date and time prior to the maturity date, (v) spreadlocks, which allow the interest rate swap users to lock in the forward differential (or spread) between the interest rate swap rate and a specified benchmark, or (vi) basis swaps, under which two parties can exchange variable interest rates based on different segments of money markets.
7. PRINCIPAL RISKS
In the normal course of business, the Funds trade financial instruments and enter into financial transactions where risk of potential loss exists due to such things as changes in the market (market risk) or failure or inability of the other party to a transaction to perform (credit and counterparty risk). See below for a detailed description of select principal risks. For a more comprehensive list of potential risks the Funds may be subject to, please see the Important Information About the Funds.
Market Risks A Fund’s investments in financial derivative instruments and other financial instruments expose the Fund to various risks such as, but not limited to, interest rate, foreign currency, equity and commodity risks.
The market values of equities, such as common stocks and preferred securities or equity related investments such as futures and options, have historically risen and fallen in periodic cycles and may decline due to general market conditions which are not specifically related to a particular company, such as real or perceived adverse economic conditions, changes in the general outlook for corporate earnings, changes in interest or currency rates or adverse investor sentiment generally. They may also decline due to factors which affect a particular industry or industries, such as labor shortages or increased production costs and competitive conditions within an industry. Different types of
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equity securities may react differently to these developments. Equity securities and equity related investments generally have greater market price volatility than fixed income securities.
Issuers that have paid regular dividends or distributions to shareholders may not continue to do so in the future. An issuer may reduce or eliminate future dividends or distributions at any time and for any reason. Moreover, a Fund may use a dividend capture strategy (i.e., purchasing an equity security shortly before the issuer pays a dividend and selling it shortly thereafter), which may expose the Fund to higher portfolio turnover, increased trading costs and the potential for capital loss or gain, particularly in the event of significant short-term price movements of stocks subject to dividend capture trading. Also, securities purchased to capture a dividend often decline in value at the time of sale (i.e., shortly following the dividend) and the resulting realized loss to the Fund may exceed the amount of the dividend received, thereby negatively impacting the Fund’s net asset value.
Interest rate risk is the risk that fixed income securities will decline in value because of an increase in interest rates. As nominal interest rates rise, the value of certain fixed income securities held by a Fund is likely to decrease. A nominal interest rate can be described as the sum of a real interest rate and an expected inflation rate. Interest rate changes can be sudden and unpredictable, and a Fund may lose money if these changes are not anticipated by the Fund’s management. A Fund may not be able to hedge against changes in interest rates or may choose not to do so for cost or other reasons. In addition, any hedges may not work as intended.
Duration is a measure of the sensitivity of a fixed income security’s market price to interest rate (i.e., yield) movements that incorporates a security’s yield, coupon, final maturity and call features, among other characteristics. Convexity is an additional measure of interest rate sensitivity that measures the rate of change of duration in response to changes in interest rates. Fixed income securities with longer durations tend to be more sensitive to changes in interest rates, usually making them more volatile than securities with shorter durations. A wide variety of factors can cause interest rates to rise (e.g., central bank monetary policies, inflation rates, general economic conditions). At present, the U.S. is experiencing historically low interest rates. The Funds may be subject to heightened interest rate risk because the Fed has ended its quantitative easing program and has begun, and may continue, to raise interest rates. Further, while U.S. bond markets have steadily grown over the past three decades, dealer “market making” ability has remained relatively stagnant. Given the importance of intermediary “market making” in creating a robust and active market, fixed income securities are currently facing increased volatility and liquidity risks. All of these factors, collectively and/or individually, could
cause a Fund to lose value. If a Fund lost enough value, the Fund could face increased redemptions by shareholders, which could further impair its performance.
To the extent that a Fund may invest in securities and instruments that are economically tied to Russia, the Fund is subject to various risks such as, but not limited to political, economic, legal, market and currency risks. The risks include uncertain political and economic policies, short-term market volatility, poor accounting standards, corruption and crime, an inadequate regulatory system, and unpredictable taxation. Investments in Russia are particularly subject to the risk that further economic sanctions may be imposed by the United States and/or other countries. Such sanctions — which may impact companies in many sectors, including energy, financial services and defense, among others — may negatively impact a Fund’s performance and/or ability to achieve its investment objective. The Russian securities market, as compared to U.S. markets, has significant price volatility, less liquidity, difficulties in obtaining accurate prices, a smaller market capitalization and a smaller number of traded securities. Settlement, clearing and registration of securities transactions are subject to risks, which may result in significant delays or problems in registering the transfer of securities, including issues with foreign nominee accounts held with custodian banks. It is possible that the ownership rights of a Fund could be lost through fraud or negligence. In addition, it may be difficult for a Fund to enforce any rights it may have in the event of loss of share registration. Adverse currency exchange rates are a risk and there may be a lack of available currency hedging instruments. Investments in Russia may be subject to the risk of nationalization or expropriation of assets. Oil, natural gas, metals, and timber account for a significant portion of Russia’s exports, leaving the country vulnerable to swings in world prices.
If a Fund invests directly in foreign (non-U.S.) currencies or in securities that trade in, and receive revenues in, foreign (non-U.S.) currencies, or in financial derivative instruments that provide exposure to foreign (non-U.S.) currencies, it will be subject to the risk that those currencies will decline in value relative to the base currency of the Fund (or Acquired Funds), or, in the case of hedging positions, that the Fund’s base currency will decline in value relative to the currency being hedged. Currency rates in foreign countries may fluctuate significantly over short periods of time for a number of reasons, including changes in interest rates, intervention (or the failure to intervene) by U.S. or foreign governments, central banks or supranational entities such as the International Monetary Fund, or by the imposition of currency controls or other political developments in the United States or abroad. As a result, a Fund’s investments in foreign currency-denominated securities may reduce the Fund’s returns.
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Credit and Counterparty Risks A Fund will be exposed to credit risk to parties with whom it trades and will also bear the risk of settlement default. A Fund minimizes concentrations of credit risk by undertaking transactions with a large number of customers and counterparties on recognized and reputable exchanges, where applicable. For financial derivative instruments traded on exchanges or clearinghouses, the primary credit risk is the creditworthiness of a Fund’s clearing broker or the exchange or clearinghouse itself. A Fund could lose money if the issuer or guarantor of a fixed income security, or the counterparty to a financial derivative instruments contract, repurchase agreement or a loan of portfolio securities, is unable or unwilling to make timely principal and/or interest payments, or to otherwise honor its obligations. Securities and financial derivative instruments are subject to varying degrees of credit risk, which may be reflected in credit ratings.
Similar to credit risk, a Fund may be exposed to counterparty risk, or the risk that an institution or other entity with which the Fund has unsettled or open transactions will default. PIMCO, as the Adviser, minimizes counterparty risks to the Funds through a number of ways. Prior to entering into transactions with a new counterparty, the PIMCO Counterparty Risk Committee conducts an extensive credit review of such counterparty and must approve the use of such counterparty. Furthermore, pursuant to the terms of the underlying contract, to the extent that unpaid amounts owed to a Fund exceed a predetermined threshold, such counterparty shall advance collateral to the Fund in the form of cash or securities equal in value to the unpaid amount owed to the Fund. A Fund may invest such collateral in securities or other instruments and will typically pay interest to the counterparty on the collateral received. If the unpaid amount owed to a Fund subsequently decreases, the Fund would be required to return to the counterparty all or a portion of the collateral previously advanced.
All transactions in listed securities are settled/paid for upon delivery using approved counterparties. The risk of default is considered minimal, as delivery of securities sold is only made once a Fund has received payment. Payment is made on a purchase once the securities have been delivered by the counterparty. The trade will fail if either party fails to meet its obligation.
Master Netting Arrangements A Fund may be subject to various netting arrangements (“Master Agreements”) with select counterparties. Master Agreements govern the terms of certain transactions, and reduce the counterparty risk associated with relevant transactions by specifying credit protection mechanisms and providing standardization that improves legal certainty. Each type of Master Agreement governs certain types of transactions. Different types of transactions may be traded out of different legal entities or affiliates of a particular organization, resulting in the need for multiple agreements
with a single counterparty. As the Master Agreements are specific to unique operations of different asset types, they allow a Fund to close out and net its total exposure to a counterparty in the event of a default with respect to all the transactions governed under a single Master Agreement with a counterparty. For financial reporting purposes the Statements of Assets and Liabilities generally present derivative assets and liabilities on a gross basis, which reflects the full risks and exposures prior to netting.
Master Agreements can also help limit counterparty risk by specifying collateral posting arrangements at pre-arranged exposure levels. Under most Master Agreements, collateral is routinely transferred if the total net exposure to certain transactions (net of existing collateral already in place) governed under the relevant Master Agreement with a counterparty in a given account exceeds a specified threshold, which typically ranges from zero to $250,000 depending on the counterparty and the type of Master Agreement. United States Treasury Bills and U.S. dollar cash are generally the preferred forms of collateral, although other forms of AAA rated paper or sovereign securities may be used depending on the terms outlined in the applicable Master Agreement. Securities and cash pledged as collateral are reflected as assets on the Statements of Assets and Liabilities as either a component of Investments at value (securities) or Deposits with counterparty. Cash collateral received is not typically held in a segregated account and as such is reflected as a liability on the Statements of Assets and Liabilities as Deposits from counterparty. The market value of any securities received as collateral is not reflected as a component of NAV. A Fund’s overall exposure to counterparty risk can change substantially within a short period, as it is affected by each transaction subject to the relevant Master Agreement.
Master Repurchase Agreements and Global Master Repurchase Agreements (individually and collectively “Master Repo Agreements”) govern repurchase, reverse repurchase, and sale-buyback transactions between a Fund and select counterparties. Master Repo Agreements maintain provisions for, among other things, initiation, income payments, events of default, and maintenance of collateral. The market value of transactions under the Master Repo Agreement, collateral pledged or received, and the net exposure by counterparty as of period end are disclosed in the Notes to Schedules of Investments.
Master Securities Forward Transaction Agreements (“Master Forward Agreements”) govern certain forward settling transactions, such as To-Be-Announced securities, delayed-delivery or sale-buyback transactions by and between a Fund and select counterparties. The Master Forward Agreements maintain provisions for, among other things, initiation and confirmation, payment and transfer, events of default, termination, and maintenance of collateral. The market value of forward settling transactions, collateral pledged or received, and the net exposure by
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counterparty as of period end is disclosed in the Notes to Schedules of Investments.
Customer Account Agreements and related addenda govern cleared derivatives transactions such as futures, options on futures, and cleared over the counter (“OTC”) derivatives. Such transactions require posting of initial margin as determined by each relevant clearing agency which is segregated in an account at a futures commission merchant (“FCM”) registered with the Commodity Futures Trading Commission (“CFTC”). In the United States, counterparty risk is significantly reduced as creditors of an FCM cannot have a claim to Fund assets in the segregated account. Additionally, portability of exposure in the event of an FCM default scenario further reduces risk to the Funds. Variation margin, or changes in market value, are exchanged daily, but may not be netted between futures and cleared OTC derivatives. The market value or accumulated unrealized appreciation (depreciation), initial margin posted, and any unsettled variation margin as of period end is disclosed in the Notes to Schedules of Investments.
International Swaps and Derivatives Association, Inc. Master Agreements and Credit Support Annexes (“ISDA Master Agreements”) govern bilateral OTC derivative transactions entered into by a Fund with select counterparties. ISDA Master Agreements maintain provisions for general obligations, representations, agreements, collateral and events of default or termination. Events of termination include conditions that may entitle counterparties to elect to terminate early and cause settlement of all outstanding transactions under the applicable ISDA Master Agreement. Any election to terminate early could be material to the financial statements. In limited circumstances, the ISDA Master Agreement may contain additional provisions that add counterparty protection beyond coverage of existing daily exposure if the counterparty has a decline in credit quality below a predefined level. These amounts, if any, may be segregated with a third-party custodian. The market value of OTC financial derivative instruments, collateral received or pledged, and net exposure by counterparty as of period end are disclosed in the Notes to Schedules of Investments.
8. FEES AND EXPENSES
(a) Investment Advisory Fee PIMCO is a majority-owned subsidiary of Allianz Asset Management of America L.P. (“Allianz Asset Management”) and serves as the Adviser to the Trust, pursuant to an investment advisory contract. The Adviser receives a monthly fee from each Fund at an annual rate based on average daily net assets (the “Investment Advisory Fee”). The Investment Advisory Fee for all classes is charged at an annual rate as noted in the table below.
(b) Supervisory and Administrative Fee PIMCO serves as administrator (the “Administrator”) and provides supervisory and administrative services to the Trust for which it receives a monthly supervisory and administrative fee based on each share class’s average daily net assets (the “Supervisory and Administrative Fee”). As the Administrator, PIMCO bears the costs of various third-party services, including audit, custodial, portfolio accounting, legal, transfer agency and printing costs.
The Investment Advisory Fees and Supervisory and Administrative Fees for all classes are charged at an annual rate as noted in the following table:
Investment Advisory Fee | Supervisory and Administrative Fee | |||||||||||||||||||||||||||
Fund Name | All Classes | Institutional Class | Class P | Administrative Class | Class D | A, C and R Classes | ||||||||||||||||||||||
PIMCO Balanced Income Fund | 0.60% | 0.30% | 0.40% | N/A | 0.40% | 0.40% | ||||||||||||||||||||||
PIMCO Dividend and Income Builder Fund | 0.69% | 0.30% | 0.40% | N/A | 0.40% | 0.40% | ||||||||||||||||||||||
PIMCO EqS® Long/Short Fund | 1.04% | 0.45% | 0.55% | N/A | 0.55% | 0.55% | ||||||||||||||||||||||
PIMCO Global Dividend Fund | 0.69% | 0.30% | 0.40% | N/A | 0.40% | 0.40% | ||||||||||||||||||||||
PIMCO International Dividend Fund | 0.69% | 0.30% | 0.40% | N/A | 0.40% | 0.40% | ||||||||||||||||||||||
PIMCO U.S. Dividend Fund | 0.60% | 0.30% | 0.40% | N/A | 0.40% | 0.40% |
(c) Distribution and Servicing Fees PIMCO Investments LLC (“PI”), a wholly-owned subsidiary of PIMCO, serves as the distributor (“Distributor”) of the Trust’s shares.
The Trust has adopted separate Distribution and Servicing Plans with respect to the Class A, Class C and Class R shares of the Trust pursuant to Rule 12b-1 under the Act. In connection with the distribution of Class C and Class R shares of the Trust, the Distributor receives distribution fees from the Trust of up to 0.75% for Class C shares and 0.25% for Class R shares, and in connection with personal services
rendered to Class A, Class C and Class R shareholders and the maintenance of such shareholder accounts, the Distributor receives servicing fees from the Trust of up to 0.25% for each of Class A, Class C and Class R shares (percentages reflect annual rates of the average daily net assets attributable to the applicable class).
The Trust has adopted a Distribution and Servicing Plan with respect to the Class D shares of each Fund pursuant to Rule 12b-1 under the Act (the “Class D Plan”). Under the terms of the Class D Plan, a Fund is permitted to compensate the Distributor out of the assets attributable
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to the Class D shares of the Fund, in an amount up to 0.25% on an annual basis of the average daily net assets of the Fund’s Class D shares for providing, or procuring through financial intermediaries, distribution, shareholder services, and/or maintenance of shareholder accounts with respect to Class D shareholders of the Fund, some of which may be deemed to be primarily intended to result in the sale of Class D shares.
The Trust has adopted a Distribution and Servicing Plan with respect to the Administrative Class shares of each Fund pursuant to Rule 12b-1 under the Act (the “Administrative Class Plan”). Under the terms of the Administrative Class Plan, a Fund may compensate the Distributor for providing, or procuring through financial intermediaries, distribution, administrative, recordkeeping, shareholder and/or related services with respect to Administrative Class shares. The Administrative Class Plan permits a Fund to make total payments at an annual rate of up to 0.25% of the average daily net assets attributable to the Administrative Class shares.
The Trust paid distribution and servicing fees at effective rates as set forth in the following table (calculated as a percentage of each Fund’s average daily net assets attributable to each class):
Distribution Fee | Servicing Fee | |||||||||
Administrative Class | — | 0.25% | ||||||||
Class D | — | 0.25% | ||||||||
Class A | — | 0.25% | ||||||||
Class C | 0.75% | 0.25% | ||||||||
Class R | 0.25% | 0.25% |
The Distributor also received the proceeds of the initial sales charges paid by the shareholders upon the purchase of Class A shares and the contingent deferred sales charges paid by the shareholders upon certain redemptions of Class A and Class C shares. For the period ended December 31, 2015, the Distributor retained $108,108 representing commissions (sales charges) and contingent deferred sales charges from the Trust.
(d) Fund Expenses PIMCO provides or procures supervisory and administrative services for shareholders and also bears the costs of various third-party services required by the Funds, including audit, custodial, portfolio accounting, legal, transfer agency and printing costs. The Trust is responsible for the following expenses: (i) taxes and governmental fees; (ii) brokerage fees and commissions and other portfolio transaction expenses; (iii) the costs of borrowing money, including interest expense; (iv) fees and expenses of the Trustees who are not “interested persons” of PIMCO or the Trust, and any counsel retained exclusively for their benefit; (v) extraordinary expense, including costs of litigation and indemnification expenses; (vi) organizational expenses; and (vii) any expenses allocated or allocable to a specific class of shares, which include service fees
payable with respect to the Administrative Class Shares, and may include certain other expenses as permitted by the Trust’s Multi-Class Plan adopted pursuant to Rule 18f-3 under the Act and subject to review and approval by the Trustees. The ratio of expenses to average net assets per share class, as disclosed on the Financial Highlights, may differ from the annual fund operating expenses per share class as disclosed in the Prospectus.
Each Trustee, other than those affiliated with PIMCO or its affiliates, receives an annual retainer of $62,000, plus $6,250 for each Board meeting attended in person, $375 ($750 in the case of the audit committee chair with respect to audit committee meetings) for each committee meeting attended and $750 for each Board meeting attended telephonically, plus reimbursement of related expenses. In addition, the audit committee chair receives an additional annual retainer of $9,000, the valuation oversight committee lead receives an additional annual retainer of $2,000 (to the extent there are co-leads of the valuation oversight committee, the annual retainer will be split evenly between the co-leads) and the governance committee chair receives an additional annual retainer of $750.
These expenses are allocated on a pro rata basis to each Fund of the Trust according to its respective net assets. The Trust pays no compensation directly to any Trustee or any other officer who is affiliated with the Administrator, all of whom receive remuneration for their services to the Trust from the Administrator or its affiliates.
(e) Expense Limitation PIMCO has agreed to waive a portion of the Funds’ Supervisory and Administrative Fees in each Fund’s first fiscal year, to the extent that the payment of each Fund’s pro rata share of organizational expenses and Trustee Fees cause the actual expense ratio to rise above the rates disclosed in the then-current prospectus plus 0.0049%, the “Expense Limit” (calculated as a percentage of each Fund’s average daily net assets attributable to each class).
PIMCO has contractually agreed to waive a portion of the Investment Advisory Fee as set forth in the following table (calculated as a percentage of each Fund’s average daily net assets).
Fund Name | Fee Waiver | Expiration Date | ||||||||
PIMCO Balanced Income Fund | 0.15% | 10/31/2016 | ||||||||
PIMCO Dividend and Income Builder Fund | 0.16% | 10/31/2016 | ||||||||
PIMCO Global Dividend Fund | 0.16% | 10/31/2016 | ||||||||
PIMCO International Dividend Fund | 0.16% | 10/31/2016 | ||||||||
PIMCO U.S. Dividend Fund | 0.16% | 10/31/2016 |
Under the Fee Limitation Agreement, PIMCO is entitled to reimbursement by each Fund of any portion of the Supervisory and Administrative Fee and/or Investment Advisory Fee waived, reduced or reimbursed pursuant to the Fee Limitation Agreement or the Expense Limitation Agreement, respectively (the “Reimbursement Amount”)
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during the previous three years, provided that such amount paid to PIMCO will not: 1) together with any recoupment of organizational expenses and pro rata Trustees’ fees pursuant to the Expense Limitation Agreement, exceed the Expense Limit; 2) exceed the total Reimbursement Amount; or 3) include any amounts previously reimbursed to PIMCO. The Fee Limitation Agreement will automatically renew for one-year terms unless PIMCO provides written notice to the Trust at least 30 days prior to the end of the then current term.
PIMCO may be reimbursed for these waived amounts in future periods, not to exceed thirty-six months after the waiver. Expenses that have been waived may still be reimbursed by the Administrator, to the extent the Fund’s annualized total portfolio operating expenses plus the amount reimbursed does not exceed the Expense Limit. The recoverable amounts to PIMCO at December 31, 2015, were as follows (amounts in thousands):
Fund Name | Recoverable Amounts | |||||
PIMCO Balanced Income Fund | $ | 151 | ||||
PIMCO Dividend and Income Builder Fund | 137 | |||||
PIMCO EqS® Long/Short Fund | 176 | |||||
PIMCO Global Dividend Fund | 97 | |||||
PIMCO International Dividend Fund | 86 | |||||
PIMCO U.S. Dividend Fund | 84 |
9. RELATED PARTY TRANSACTIONS
The Adviser, Administrator, and Distributor are related parties. Fees payable to these parties are disclosed in Note 8 and the accrued related party fee amounts are disclosed on the Statements of Assets and Liabilities.
Certain Funds are permitted to purchase or sell securities from or to certain related affiliated funds under specified conditions outlined in procedures adopted by the Board. The procedures have been designed to ensure that any purchase or sale of securities by the Funds from or to another fund or portfolio that are, or could be, considered an affiliate, or affiliate of an affiliate, by virtue of having a common investment adviser (or affiliated investment advisers), common Trustees and/or common officers complies with Rule 17a-7 under the Act.
Further, as defined under the procedures, each transaction is effected at the current market price. During the period ended December 31, 2015, the Funds below engaged in purchases and sales of securities pursuant to Rule 17a-7 under the Act (amounts in thousands†):
Fund Name | Purchases | Sales | ||||||||
PIMCO Balanced Income Fund | $ | 91 | $ | 16 | ||||||
PIMCO Dividend and Income Builder Fund | 0 | 12,968 | ||||||||
PIMCO Global Dividend Fund | 0 | 39 |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
10. GUARANTEES AND INDEMNIFICATIONS
Under the Trust’s organizational documents, each Trustee or officer of the Trust is indemnified and each employee or other agent of the Trust (including the Trust’s investment manager) may be indemnified, to the extent permitted by the Act, against certain liabilities that may arise out of performance of their duties to the Funds. Additionally, in the normal course of business, the Funds enter into contracts that contain a variety of indemnification clauses. The Funds’ maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Funds that have not yet occurred. However, the Funds have not had prior claims or losses pursuant to these contracts.
11. PURCHASES AND SALES OF SECURITIES
The length of time a Fund has held a particular security is not generally a consideration in investment decisions. A change in the securities held by a Fund is known as “portfolio turnover.” Each Fund may engage in frequent and active trading of portfolio securities to achieve its investment objective, particularly during periods of volatile market movements. High portfolio turnover may involve correspondingly greater transaction costs to a Fund, including brokerage commissions or dealer mark-ups and other transaction costs on the sale of securities and reinvestments in other securities. Such sales may also result in realization of taxable capital gains, including short-term capital gains (which are generally taxed at ordinary income tax rates). The transaction costs and tax effects associated with portfolio turnover may adversely affect a Fund’s performance. The portfolio turnover rates are reported in the Financial Highlights.
Purchases and sales of securities (excluding short-term investments) for the period ended December 31, 2015, were as follows (amounts in thousands†):
U.S. Government/Agency | All Other | |||||||||||||||||
Fund Name | Purchases | Sales | Purchases | Sales | ||||||||||||||
PIMCO Balanced Income Fund | $ | 774 | $ | 280 | $ | 5,093 | $ | 3,949 | ||||||||||
PIMCO Dividend and Income Builder Fund | 0 | 0 | 275,002 | 463,118 | ||||||||||||||
PIMCO EqS® Long/Short Fund | 8,800 | 8,803 | 3,989,209 | 4,281,500 | ||||||||||||||
PIMCO Global Dividend Fund | 0 | 0 | 50,194 | 59,569 | ||||||||||||||
PIMCO International Dividend Fund | 0 | 0 | 2,778 | 4,486 | ||||||||||||||
PIMCO U.S. Dividend Fund | 0 | 0 | 3,096 | 2,032 |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
78 | PIMCO EQUITY SERIES |
Table of Contents
December 31, 2015 (Unaudited)
12. SHARES OF BENEFICIAL INTEREST
The Trust may issue an unlimited number of shares of beneficial interest with a $0.0001 par value. Changes in shares of beneficial interest were as follows (shares and amounts in thousands†):
PIMCO Balanced Income Fund(1) | PIMCO Dividend and Income Builder Fund | PIMCO EqS® Long/Short Fund | ||||||||||||||||||||||||||||||||||||||||||||||||
Six Months Ended 12/31/2015 | Year Ended 06/30/2015 | Six Months Ended 12/31/2015 | Year Ended 06/30/2015 | Six Months Ended 12/31/2015 | Year Ended 06/30/2015 | |||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||||||||||||||
Receipts for shares sold | ||||||||||||||||||||||||||||||||||||||||||||||||||
Institutional Class | 3 | $ | 12 | 187 | $ | 1,919 | 384 | $ | 4,445 | 1,504 | $ | 19,087 | 5,066 | $ | 60,468 | 4,616 | $ | 54,428 | ||||||||||||||||||||||||||||||||
Class P | 1 | 8 | 23 | 227 | 1,654 | 19,013 | 7,885 | 100,872 | 10,413 | 124,355 | 18,402 | 216,705 | ||||||||||||||||||||||||||||||||||||||
Class D | 25 | 247 | 43 | 439 | 602 | 6,902 | 1,954 | 24,794 | 1,840 | 21,721 | 2,701 | 31,509 | ||||||||||||||||||||||||||||||||||||||
Class A | 252 | 2,328 | 454 | 4,634 | 3,339 | 38,156 | 8,330 | 105,843 | 3,189 | 37,701 | 3,937 | 46,184 | ||||||||||||||||||||||||||||||||||||||
Class C | 246 | 2,311 | 406 | 4,097 | 3,137 | 35,222 | 8,613 | 108,921 | 3,137 | 36,291 | 3,298 | 38,089 | ||||||||||||||||||||||||||||||||||||||
Class R | 0 | 0 | 0 | 0 | 1 | 15 | 1 | 14 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||||||
Issued as reinvestment of distributions | ||||||||||||||||||||||||||||||||||||||||||||||||||
Institutional Class | 27 | 243 | 22 | 216 | 345 | 3,428 | 346 | 4,277 | 218 | 2,550 | 163 | 1,887 | ||||||||||||||||||||||||||||||||||||||
Class P | 0 | 4 | 0 | 3 | 490 | 4,882 | 409 | 5,058 | 264 | 3,078 | 108 | 1,248 | ||||||||||||||||||||||||||||||||||||||
Class D | 2 | 16 | 1 | 6 | 239 | 2,367 | 137 | 1,691 | 55 | 640 | 22 | 247 | ||||||||||||||||||||||||||||||||||||||
Class A | 15 | 137 | 5 | 49 | 1,814 | 17,961 | 1,157 | 14,302 | 152 | 1,763 | 83 | 957 | ||||||||||||||||||||||||||||||||||||||
Class C | 15 | 133 | 4 | 45 | 1,877 | 18,499 | 1,088 | 13,410 | 161 | 1,820 | 70 | 784 | ||||||||||||||||||||||||||||||||||||||
Class R | 0 | 0 | 0 | 0 | 2 | 22 | 2 | 22 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||||||
Cost of shares redeemed | ||||||||||||||||||||||||||||||||||||||||||||||||||
Institutional Class | (61 | ) | (587 | ) | (80 | ) | (808 | ) | (2,951 | ) | (32,999 | ) | (3,158 | ) | (39,875 | ) | (10,975 | ) | (131,448 | ) | (25,702 | ) | (299,684 | ) | ||||||||||||||||||||||||||
Class P | (2 | ) | (20 | ) | (10 | ) | (99 | ) | (9,577 | ) | (105,483 | ) | (6,531 | ) | (81,608 | ) | (4,237 | ) | (50,526 | ) | (24,620 | ) | (285,630 | ) | ||||||||||||||||||||||||||
Class D | (12 | ) | (124 | ) | (8 | ) | (85 | ) | (1,655 | ) | (18,666 | ) | (1,226 | ) | (15,462 | ) | (753 | ) | (8,889 | ) | (5,605 | ) | (64,780 | ) | ||||||||||||||||||||||||||
Class A | (171 | ) | (1,632 | ) | (54 | ) | (547 | ) | (6,742 | ) | (73,916 | ) | (9,822 | ) | (124,012 | ) | (4,357 | ) | (51,350 | ) | (21,852 | ) | (254,288 | ) | ||||||||||||||||||||||||||
Class C | (108 | ) | (1,006 | ) | (78 | ) | (786 | ) | (8,165 | ) | (89,521 | ) | (7,481 | ) | (93,888 | ) | (1,772 | ) | (20,491 | ) | (9,708 | ) | (110,601 | ) | ||||||||||||||||||||||||||
Class R | 0 | 0 | 0 | 0 | (1 | ) | (15 | ) | (15 | ) | (186 | ) | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||
Net increase (decrease) resulting from Fund share transactions | 232 | $ | 2,070 | 915 | $ | 9,310 | (15,207 | ) | $ | (169,688 | ) | 3,193 | $ | 43,260 | 2,401 | $ | 27,683 | (54,087 | ) | $ | (622,945 | ) | ||||||||||||||||||||||||||||
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 79 |
Table of Contents
Notes to Financial Statements (Cont.)
PIMCO Global Dividend Fund(2) | PIMCO International Dividend Fund(3) | PIMCO U.S. Dividend Fund(4) | ||||||||||||||||||||||||||||||||||||||||||||||||
Six Months Ended 12/31/2015 | Year Ended 06/30/2015 | Six Months Ended 12/31/2015 | Inception date through June 30, 2015 | Six Months Ended 12/31/2015 | Inception date through June 30, 2015 | |||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||||||||||||||
Receipts for shares sold | ||||||||||||||||||||||||||||||||||||||||||||||||||
Institutional Class | 1,725 | $ | 11,244 | 1,476 | $ | 13,197 | 5 | $ | 52 | 436 | $ | 4,410 | 20 | $ | 174 | 410 | $ | 4,113 | ||||||||||||||||||||||||||||||||
Class P | 31 | 199 | 281 | 2,945 | 1 | 19 | 497 | 5,519 | 0 | 0 | 1 | 10 | ||||||||||||||||||||||||||||||||||||||
Class D | 4 | 29 | 83 | 749 | 6 | 63 | 24 | 260 | 6 | 63 | 7 | 69 | ||||||||||||||||||||||||||||||||||||||
Class A | 554 | 3,529 | 2,242 | 19,211 | 47 | 468 | 100 | 1,095 | 87 | 786 | 78 | 817 | ||||||||||||||||||||||||||||||||||||||
Class C | 463 | 2,903 | 1,178 | 10,003 | 18 | 187 | 58 | 627 | 58 | 533 | 62 | 649 | ||||||||||||||||||||||||||||||||||||||
Class R | 1 | 1 | 1 | 7 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||||||
Issued as reinvestment of distributions | ||||||||||||||||||||||||||||||||||||||||||||||||||
Institutional Class | 1,444 | 7,912 | 3,460 | 25,542 | 16 | 139 | 6 | 65 | 15 | 126 | 5 | 56 | ||||||||||||||||||||||||||||||||||||||
Class P | 42 | 234 | 278 | 2,029 | 1 | 6 | 1 | 15 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||||||
Class D | 34 | 186 | 283 | 2,071 | 1 | 7 | 0 | 2 | 0 | 2 | 0 | 0 | ||||||||||||||||||||||||||||||||||||||
Class A | 681 | 3,736 | 2,622 | 19,146 | 3 | 26 | 0 | 5 | 3 | 30 | 0 | 4 | ||||||||||||||||||||||||||||||||||||||
Class C | 475 | 2,585 | 1,868 | 13,534 | 2 | 18 | 0 | 3 | 3 | 23 | 0 | 2 | ||||||||||||||||||||||||||||||||||||||
Class R | 0 | 1 | 8 | 59 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||||||
Cost of shares redeemed | ||||||||||||||||||||||||||||||||||||||||||||||||||
Institutional Class | (1,967 | ) | (11,614 | ) | (20,589 | ) | (252,716 | ) | (31 | ) | (303 | ) | 0 | 0 | (8 | ) | (72 | ) | 0 | (3 | ) | |||||||||||||||||||||||||||||
Class P | (203 | ) | (1,251 | ) | (489 | ) | (3,951 | ) | (163 | ) | (1,683 | ) | (333 | ) | (3,588 | ) | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||
Class D | (122 | ) | (815 | ) | (655 | ) | (6,018 | ) | (9 | ) | (89 | ) | (1 | ) | (16 | ) | (1 | ) | (10 | ) | (5 | ) | (49 | ) | ||||||||||||||||||||||||||
Class A | (1,613 | ) | (10,367 | ) | (4,386 | ) | (40,315 | ) | (59 | ) | (596 | ) | (5 | ) | (56 | ) | (28 | ) | (260 | ) | (4 | ) | (42 | ) | ||||||||||||||||||||||||||
Class C | (1,218 | ) | (7,931 | ) | (2,419 | ) | (21,403 | ) | (8 | ) | (79 | ) | (1 | ) | (16 | ) | (16 | ) | (146 | ) | (2 | ) | (21 | ) | ||||||||||||||||||||||||||
Class R | (8 | ) | (54 | ) | (16 | ) | (137 | ) | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||
Net increase (decrease) resulting from Fund share transactions |
| 323 |
| $ | 527 | (14,774 | ) | $ | (216,047 | ) | (170 | ) | $ | (1,765 | ) | 782 | $ | 8,325 | 139 | $ | 1,249 | 552 | $ | 5,605 | ||||||||||||||||||||||||||
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
(1) | As of December 31, 2015, one shareholder owned 10% or more of the Fund’s total outstanding shares comprising 18% of the Fund, and the shareholder is a related party of the Fund.* |
(2) | As of December 31, 2015, one shareholder owned 10% or more of the Fund’s total outstanding shares comprising 43% of the Fund, and the shareholder is a related party of the Fund.* |
(3) | As of December 31, 2015, one shareholder owned 10% or more of the Fund’s total outstanding shares comprising 52% of the Fund, and the shareholder is a related party of the Fund.* |
(4) | As of December 31, 2015, one shareholder owned 10% or more of the Fund’s total outstanding shares comprising 46% of the Fund, and the shareholder is a related party of the Fund.* |
* | Related parties may include, but are not limited to, the investment manager and its affiliates, affiliated broker dealers, fund of funds and directors or employees of the Trust or Adviser. |
13. REGULATORY AND LITIGATION MATTERS
The Funds are not named as defendants in any material litigation or arbitration proceedings and are not aware of any material litigation or claim pending or threatened against them.
PIMCO has received a Wells Notice from the staff of the U.S. Securities and Exchange Commission (“SEC”) that relates to the PIMCO Total Return Active Exchange-Traded Fund (“BOND”), a series of PIMCO ETF Trust. The notice indicates the staff’s preliminary determination to recommend that the SEC commence a civil action against PIMCO stemming from a non-public investigation relating to BOND. A Wells Notice is neither a formal allegation of wrongdoing nor a finding that any law was violated.
This matter principally pertains to the valuation of smaller sized positions in non-agency mortgage-backed securities purchased by
BOND between its inception on February 29, 2012 and June 30, 2012, BOND’s performance disclosures for that period, and PIMCO’s compliance policies and procedures related to these matters.
The Wells process provides PIMCO with the opportunity to demonstrate to the SEC staff why it believes its conduct was appropriate, in keeping with industry standards, and that no action should be taken. PIMCO believes that this matter is unlikely to have a material adverse effect on any Fund or on PIMCO’s ability to provide investment management services to any Fund.
The foregoing speaks only as of the date of this report.
14. FEDERAL INCOME TAX MATTERS
Each Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code (the “Code”) and distribute all
80 | PIMCO EQUITY SERIES |
Table of Contents
December 31, 2015 (Unaudited)
of its taxable income and net realized gains, if applicable, to shareholders. Accordingly, no provision for Federal income taxes has been made.
A Fund may be subject to local withholding taxes, including those imposed on realized capital gains. Any applicable foreign capital gains tax is accrued daily based upon net unrealized gains, and may be payable following the sale of any applicable investments.
In accordance with U.S. GAAP, the Adviser has reviewed the Funds’ tax positions for all open tax years. As of December 31, 2015, the Funds have recorded no liability for net unrecognized tax benefits relating to uncertain income tax positions they have taken or expect to take in future tax returns.
The Funds file U.S. tax returns. While the statute of limitations remains open to examine the Funds’ U.S. tax returns filed for the fiscal years ending in 2012-2014, no examinations are in progress or anticipated at this time. The Funds are not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Under the Regulated Investment Company Act of 2010, a fund is permitted to carry forward any new capital losses for an unlimited period. Additionally, such capital losses that are carried forward will retain their character as either short-term or long-term capital losses rather than being considered all short-term under previous law.
As of June 30, 2015, the Funds had the following post-effective capital losses with no expiration (amounts in thousands):
Short-Term | Long-Term | |||||||||
PIMCO Balanced Income Fund | $ | — | $ | — | ||||||
PIMCO Dividend and Income Builder Fund | — | — | ||||||||
PIMCO Emerging Multi-Asset Fund | 390 | 5,710 | ||||||||
PIMCO EqS® Emerging Markets Fund | 28,573 | 8,751 | ||||||||
PIMCO EqS® Long/Short Fund | — | — | ||||||||
PIMCO Global Dividend Fund | — | — | ||||||||
PIMCO International Dividend Fund | — | — | ||||||||
PIMCO US Dividend Fund | — | — | ||||||||
PIMCO EqS Pathfinder Fund® | 262 | 393 |
As of December 31, 2015, the aggregate cost and the net unrealized appreciation (depreciation) of investments for federal income tax purposes are as follows (amounts in thousands):
Fund Name | Federal Tax Cost | Aggregate Gross Unrealized Appreciation | Aggregate Gross Unrealized (Depreciation) | Net Unrealized Appreciation (Depreciation) (1) | ||||||||||||||
PIMCO Balanced Income Fund | $ | 16,821 | $ | 213 | $ | (1,423 | ) | $ | (1,210 | ) | ||||||||
PIMCO Dividend and Income Builder Fund | 681,222 | 22,037 | (88,685 | ) | (66,648 | ) | ||||||||||||
PIMCO EqS® Long/Short Fund | 880,194 | 14,557 | (10,030 | ) | 4,527 | |||||||||||||
PIMCO Global Dividend Fund | 103,386 | 5,236 | (11,976 | ) | (6,740 | ) | ||||||||||||
PIMCO International Dividend Fund | 5,888 | 199 | (769 | ) | (570 | ) | ||||||||||||
PIMCO U.S. Dividend Fund | 6,189 | 64 | (462 | ) | (398 | ) |
(1) | Primary differences, if any, between book and tax net unrealized appreciation (depreciation) are attributable to wash sale loss deferrals for federal income tax purposes. |
15. SUBSEQUENT EVENTS
On November 6, 2015, the Board approved the liquidation of Class R shares of PIMCO Dividend and Income Builder Fund and PIMCO Global Dividend Fund. The liquidation of Class R shares occurred on January 22, 2016.
There were no other subsequent events identified that require recognition or disclosure.
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 81 |
Table of Contents
Glossary: (abbreviations that may be used in the preceding statements)
(Unaudited)
Counterparty Abbreviations: | ||||||||||
AZD | Australia and New Zealand Banking Group | GSC | Goldman Sachs & Co. | PIP | US Bancorp Piper Jaffray | |||||
BCY | Barclays Capital, Inc. | GST | Goldman Sachs International | RDR | RBC Capital Markets | |||||
BNP | BNP Capital Markets Ltd. | HUS | HSBC Bank USA N.A. | RJA | Raymond James and Associates | |||||
BOA | Bank of America N.A. | JEF | Jefferies & Co., Inc. | SAL | Citigroup Global Markets, Inc. | |||||
BPS | BNP Paribas S.A. | JPM | JPMorgan Chase Bank N.A. | SCX | Standard Chartered Bank | |||||
BRC | Barclays Bank PLC | KCG | Knight Capital Group | SNF | Sanford C. Bernstein & Co. | |||||
CBK | Citibank N.A. | MRJ | Merrill Lynch Professional Clearing Corp | SSB | State Street Bank and Trust Co. | |||||
DEU | Deutsche Bank Securities, Inc. | MSB | Morgan Stanley Bank, N.A | UAG | UBS AG Stamford | |||||
DUB | Deutsche Bank AG | MSC | Morgan Stanley & Co., Inc. | UBS | UBS Securities LLC | |||||
FBF | Credit Suisse International | MYC | Morgan Stanley Capital Services, Inc. | WFS | Wells Fargo Securities, LLC | |||||
FOB | Credit Suisse Securities (USA) LLC | NAB | National Australia Bank Ltd. | |||||||
GLM | Goldman Sachs Bank USA | PER | Pershing LLC | |||||||
Currency Abbreviations: | ||||||||||
AUD | Australian Dollar | GBP | British Pound | SGD | Singapore Dollar | |||||
BRL | Brazilian Real | HKD | Hong Kong Dollar | USD (or $) | United States Dollar | |||||
CAD | Canadian Dollar | JPY | Japanese Yen | ZAR | South African Rand | |||||
DKK | Danish Krone | MXN | Mexican Peso | |||||||
EUR | Euro | RUB | Russian Ruble | |||||||
Exchange Abbreviations: | ||||||||||
OTC | Over the Counter | |||||||||
Index/Spread Abbreviations: | ||||||||||
ABX.HE | Asset-Backed Securities Index - Home Equity | CDX.HY | Credit Derivatives Index - High Yield | CMBX | Commercial Mortgage-Backed Index | |||||
Other Abbreviations: | ||||||||||
ABS | Asset-Backed Security | CDI | Brazil Interbank Deposit Rate | SP - ADR | Sponsored American Depositary Receipt | |||||
ADR | American Depositary Receipt | LIBOR | London Interbank Offered Rate | SP - GDR | Sponsored Global Depositary Receipt | |||||
ALT | Alternate Loan Trust | NVDR | Non-Voting Depositary Receipt | TBD% | Interest rate to be determined when loan settles | |||||
BBR | Bank Bill Rate | PIK | Payment-in-Kind | TIIE | Tasa de Interés Interbancaria de Equilibrio | |||||
BBSW | Bank Bill Swap Reference Rate | REMIC | Real Estate Mortgage Investment Conduit |
82 | PIMCO EQUITY SERIES |
Table of Contents
Approval of Investment Advisory Contract and Other Agreements
(Unaudited)
Approval of Renewal of the Investment Advisory Contract and Second Amended and Restated Supervision and Administration Agreement
At a meeting held on August 12, 2015, the Board of Trustees (the “Board”) of PIMCO Equity Series (the “Trust”), including all of the Trustees who are not “interested persons” of the Trust under the Investment Company Act of 1940, as amended (the “Independent Trustees”), considered and unanimously approved the Investment Advisory Contract (the “Investment Advisory Contract”) between the Trust, on behalf of each of the Trust’s series (the “Funds”), and Pacific Investment Management Company LLC (“PIMCO”) for an additional one-year term through August 31, 2016. The Board also considered and unanimously approved for an additional one-year term through August 31, 2016, the Second Amended and Restated Supervision and Administration Agreement (the “Supervision and Administration Agreement” and together with the Investment Advisory Contract, the “Agreements”) between the Trust, on behalf of the Funds, and PIMCO.
The information, material factors and conclusions that formed the basis for the Board’s approvals are summarized below.
1. INFORMATION RECEIVED
(a) Materials Reviewed: During the course of the past year, the Trustees received a wide variety of materials relating to the services provided by PIMCO to the Trust. At each of its quarterly meetings, the Board reviewed the Funds’ investment performance and a significant amount of information relating to Fund operations, including shareholder services, valuation and custody, the Funds’ compliance program and other information relating to the nature, extent and quality of services provided by PIMCO to the Trust. In considering whether to approve the renewal of the Agreements, the Board also reviewed supplementary information, including, but not limited to, comparative industry data with regard to investment performance, advisory and supervisory and administrative fees and expenses, financial information for PIMCO, information regarding the profitability to PIMCO of its relationship with the Funds, information about the personnel providing investment management services, other advisory services and supervisory and administrative services to the Funds, and information about the fees charged and services provided to other clients with similar investment mandates as the Funds (where applicable). In addition, the Board reviewed materials provided by counsel to the Trust and the Independent Trustees, which included, among other things, memoranda outlining legal duties of the Board in considering the continuation of the Agreements.
(b) Review Process: In connection with the renewal of the Agreements, the Board reviewed written materials prepared by PIMCO in response to requests from counsel to the Trust and the Independent Trustees. The Board requested and received assistance and advice regarding applicable legal standards from counsel to the Trust and the
Independent Trustees, and reviewed comparative fee and performance data prepared at the Board’s request by Lipper, Inc. (“Lipper”), an independent provider of investment company performance and fee and expense data. The Board heard oral presentations on matters related to the Agreements and met both as a full Board and in a separate session of the Independent Trustees, without management present, at the August 12, 2015 meeting. The Independent Trustees also conducted a telephonic meeting with counsel to the Trust and the Independent Trustees on July 30, 2015 to discuss the materials presented. In addition, the Independent Trustees requested and received from PIMCO additional information including, but not limited to, information related to profitability and comparative performance information.
The approval determinations were made on the basis of each Trustee’s business judgment after consideration of all the information presented. Individual Trustees may have given different weights to certain factors and assigned various degrees of materiality to information received in connection with the approval process. In deciding to approve the renewal of the Agreements, the Board did not identify any single factor or particular information that, in isolation, was controlling. This summary describes the most important, but not all, of the factors considered by the Board.
2. NATURE, EXTENT AND QUALITY OF SERVICES
(a) PIMCO, its Personnel, and Resources: The Board considered the depth and quality of PIMCO’s investment management process, including: the experience, capability and integrity of its senior management and other personnel; the overall financial strength and stability of its organization; and the ability of its organizational structure to address changes in assets under management. The Board also considered the various services in addition to portfolio management that PIMCO provides under the Investment Advisory Contract. The Board noted that PIMCO makes available to its investment professionals a variety of resources and systems relating to investment management, compliance, trading, performance and portfolio accounting. The Board also noted that PIMCO is making a long-term commitment to building an equity asset management platform, and that PIMCO continues to invest in personnel and global infrastructure necessary to support the equity business. In this regard, the Board considered PIMCO’s commitment to investing in information technology supporting investment management and compliance, as well as PIMCO’s continuing efforts to attract and retain qualified personnel, including personnel with relevant equities experience, and to maintain and enhance its resources and systems. The Board considered PIMCO’s policies, procedures and systems to reasonably assure compliance with applicable laws and regulations and its
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 83 |
Table of Contents
Approval of Investment Advisory Contract and Other Agreements (Cont.)
commitment to these programs, its oversight of matters that may involve conflicts of interest between the Funds’ investments and those of other accounts managed by PIMCO, and its efforts to keep the Trustees informed about matters relevant to the Funds and their shareholders. The Board also considered PIMCO’s continuous investment in new disciplines and talented personnel, which has enhanced PIMCO’s service to the Funds and has allowed PIMCO to introduce innovative new funds over time.
The Trustees considered information they had received about the steps that PIMCO has taken in recent years with respect to active management of counterparty risk, such as implementing procedures requiring daily collateral adjustments and frequent communication between credit analysts and the counterparty risk committee, which oversees counterparty risk on a firm-wide basis, continually evaluating requests to add or remove approved counterparties as market needs and conditions warrant. The Trustees also considered that, over the last several years, PIMCO has continued to strengthen the process it uses to assess the financial stability of counterparties with which the Funds do business, to manage collateral and to protect portfolios from an unforeseen deterioration in the creditworthiness of trading counterparties. The Trustees noted that, consistent with its fiduciary duty, PIMCO executes transactions through a competitive best execution process and uses only those counterparties that meet its stringent and monitored criteria. The Trustees considered that PIMCO’s collateral management team utilizes a counterparty risk system to analyze portfolio level exposure and collateral being exchanged with counterparties.
In addition, the Trustees considered new services and service enhancements that PIMCO has implemented since the Board renewed the Agreements in 2014, including, but not limited to: conducting a targeted review of quality and efficiency in the valuation process; expanding the analytical review of shareholder reports by State Street Bank and Trust Company, the Funds’ custodian; developing a process for monthly forecasts of taxable and book income to enhance portfolio management of investment income; continuing the expansion of a proprietary performance reconciliation tool, which includes next-day comparison of daily internal performance to custodian bank performance to identify potential errors and guardrail net asset value calculations; developing and implementing the Global Process Monitor application, which includes real-time tracking and escalation protocols for critical activities; and implementing monthly cash flow reporting processes to support client and media demands for information about investor flows and assets under management data.
Ultimately, the Board concluded that the nature, extent and quality of services proposed to be provided by PIMCO under the Agreements are likely to benefit the Funds and their respective shareholders.
(b) Other Services: The Board also considered the nature, extent, quality and cost of supervisory and administrative services provided by PIMCO to the Funds under the Supervision and Administration Agreement. The Board considered the terms of the Supervision and Administration Agreement, under which the Trust pays for the supervisory and administrative services provided pursuant to that agreement under what is essentially an all-in fee structure (the “unified fee”). In return, PIMCO provides or procures certain supervisory and administrative services and bears the costs of various third party services required by the Funds, including audit, custodial, portfolio accounting, legal, transfer agency and printing costs. The Board noted that the scope and complexity of the supervisory and administrative services provided by PIMCO under the Supervision and Administration Agreement continue to increase. The Board considered PIMCO’s provision of these services and its supervision of the Trust’s third party service providers to assure that these service providers continue to provide a high level of service relative to alternatives available in the market.
Ultimately, the Board concluded that the nature, extent and quality of the services provided by PIMCO has benefited, and will likely continue to benefit, the Funds and their shareholders.
3. INVESTMENT PERFORMANCE
The Board received and examined information from PIMCO concerning the Funds’ performance, as available, over short- and long-term periods ended May 31, 2015 and other performance data, as available, over short- and long-term periods ended June 30, 2015 (the “PIMCO Report”) and from Lipper concerning the Funds’ performance, as available, over short- and long-term periods ended May 31, 2015 (the “Lipper Report”). The Board considered that limited performance information was available for the PIMCO RealPath Blend Funds because the Funds recently commenced operations. The Board also considered information regarding both the short- and long-term investment performance of each Fund relative to its peer group and relevant benchmark index as provided to the Board in advance of each of its quarterly meetings throughout the year, including the PIMCO Report and Lipper Report, which were provided in advance of the August 12, 2015 meeting.
The Board noted that, according to Lipper, certain Funds had underperformed in comparison to their respective peer groups or benchmark indexes, or both, over short- and long-term periods. The Board discussed with PIMCO the reasons for the underperformance of certain Funds over short- and long-term periods. The Board also discussed actions that have been taken by PIMCO to attempt to improve performance and took note of PIMCO’s plans to monitor performance going forward.
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The Board ultimately concluded, within the context of all of its considerations in connection with the Agreements, that PIMCO’s performance record and process in managing the Funds indicates that its continued management is likely to benefit the Funds and their shareholders, and merits the approval of the continuation of the Agreements.
4. ADVISORY FEES, SUPERVISORY AND ADMINISTRATIVE FEES AND TOTAL EXPENSES
The Board considered that PIMCO seeks to price funds to scale at the outset with reference to the total expense ratios of the respective Lipper median (if available), while providing a premium for innovative investment offerings. PIMCO reported to the Board that, in proposing fees for any Fund or class of shares, it considers a number of factors, including the type and complexity of the services provided, the cost of providing services, the risk assumed by PIMCO in the development of products and the provision of services, the impact on potential returns from different levels of fees, the competitive marketplace for financial products, and the attractiveness of potential Fund returns to current and potential investors. Fees charged to or proposed for different Funds for advisory services and supervisory and administrative services may vary in light of these various factors. The Board also considered that PIMCO reviews the Funds’ fee levels and carefully considers reductions where appropriate.
The Board reviewed the advisory fees, supervisory and administrative fees and total expenses of the Funds (each as a percentage of average net assets) and compared such amounts with the average and median fee and expense levels of other similar funds. With respect to advisory fees, the Board reviewed data from Lipper that compared the average and median advisory fees of other funds in a “Peer Group” of comparable funds, as well as the universe of other similar funds. The Board noted that PIMCO had contractually agreed, through October 31, 2015, to reduce its advisory fee by amounts shown in the table below:
PIMCO Balanced Income Fund | 0.15% | |||||
PIMCO Dividend and Income Builder Fund | 0.16% | |||||
PIMCO Global Dividend Fund | 0.16% | |||||
PIMCO International Dividend Fund | 0.16% | |||||
PIMCO U.S. Dividend Fund | 0.16% |
The Board further noted that the PIMCO Emerging Multi-Asset, PIMCO EqS® Emerging Markets and PIMCO EqS® Pathfinder Funds liquidated on July 14, 2015.
The Board also reviewed data comparing the Funds’ advisory fees to the standard fee rate PIMCO charges to separate accounts and to other investment companies with similar investment strategies, including differences in advisory services provided. The Board discussed separate
account and/or U.S. and non-U.S. registered fund comparisons to the PIMCO Global Dividend Fund, PIMCO Balanced Income Fund and PIMCO Dividend and Income Builder Fund (as available), noting that for the remaining Funds, there were no appropriate comparisons among separate accounts or non-U.S. registered funds at the time that the Board considered the Agreements. For PIMCO Global Dividend Fund, for which PIMCO offers a separate account with an investment strategy similar to the Fund, the Board noted that the separate account fee was lower than that charged to the Fund, but also noted that the differences in fees were attributable to various factors, including differences in the advisory and other services provided by PIMCO to the Fund, the manner in which similar portfolios may be managed, different requirements with respect to liquidity management and the implementation of other regulatory requirements, and the fact that separate accounts may have other contractual arrangements that justify different levels of fees. The Board noted that the advisory fees (or management fees, where applicable) for most Funds were similar to the fee rates charged to other investment companies with the same investment strategies as the Funds.
In considering the fees paid by the Funds, the Board noted that retail investors in the Funds receive the benefit of PIMCO’s advisory services at the same advisory fee rates as institutional investors in the Funds.
The Board considered the Funds’ supervisory and administrative fees, comparing them to similar funds in the report supplied by Lipper. The Board also considered that as the Funds’ business has become increasingly complex and the number of Funds has grown, PIMCO has provided an increasingly broad array of fund supervisory and administrative functions. In addition, the Board considered the Trust’s unified fee structure, under which the Trust pays for the supervisory and administrative services it requires for one set fee and, in return, PIMCO provides or procures supervisory and administrative services and bears the costs of various third party services required by the Funds, including audit, custodial, portfolio accounting, legal, transfer agency and printing costs. The Board further considered that many other funds pay for these services separately, and thus it is difficult to directly compare the Trust’s unified supervisory and administrative fees with the fees paid by other funds for administrative services alone. The Board also considered that the unified supervisory and administrative fee leads to Fund fees that are fixed, rather than variable. The Board noted that, although the unified fee structure does not have breakpoints, it implicitly reflects economies of scale by fixing the absolute level of Fund fees at competitive levels even if the Funds’ operating costs rise when assets remain flat or decrease. The Board concluded that the Funds’ supervisory and administrative fees were reasonable in relation to the value of the services provided, including the services provided to different classes of shareholders, and that the expenses assumed contractually by PIMCO under the
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Approval of Investment Advisory Contract and Other Agreements (Cont.)
(Unaudited)
Supervision and Administration Agreement represent, in effect, a cap on overall Fund fees, which is beneficial to the Funds and their shareholders.
The Board noted that the Funds’ total expenses continued to be generally in-line with those of competitor funds. The Board discussed with PIMCO those Funds and/or classes of Funds that had above median total expenses. Upon comparing the Funds’ total expenses to other funds in the “Peer Groups” provided by Lipper, the Board found total expenses of each Fund to be reasonable.
Based on the information presented by PIMCO and Lipper, members of the Board determined, in the exercise of their business judgment, that the level of the advisory fees and supervisory and administrative fees charged by PIMCO under the Agreements, as well as the total expenses of each Fund, are reasonable.
5. ADVISER COSTS, LEVEL OF PROFITS AND ECONOMIES OF SCALE
The Board reviewed information regarding PIMCO’s costs of providing services to the Funds as a whole and considered that PIMCO continues to invest in the equity asset management platform and does not expect to derive any profit from the Funds during the Trust’s fiscal year ended December 31, 2015. The Board noted that it had received information regarding the structure and manner in which PIMCO’s investment professionals were compensated, and PIMCO’s view of the relationship of such compensation to the attraction and retention of quality personnel. The Board considered PIMCO’s need to invest in technology, cyber security, information security, shareholder privacy, business continuity planning, infrastructure and staff to reinforce and offer new services and to accommodate changing regulatory requirements.
With respect to potential economies of scale, the Board noted that PIMCO shares the benefits of economies of scale with the Funds and their shareholders in a number of ways, including through the pricing of Funds to scale from inception and the enhancement of services provided to the Funds in return for fees paid. In considering the advisory fees paid by the Funds, the Board also noted that retail investors in the Funds receive the benefit of PIMCO’s advisory services at the same advisory fee rates as institutional investors in the Funds. The Board considered that the Funds’ unified fee rates had been set competitively and/or priced to scale from inception and continued to be competitive compared with peers. The Board also considered that the unified fee is a transparent means of informing Fund shareholders of the fees associated with the Funds, and that the Funds bear certain expenses that are not covered by the advisory fee or the unified fee.
The Trustees considered that the unified fee has provided inherent economies of scale because a Fund maintains competitive fixed unified fees even if the particular Fund’s assets decline and/or operating costs
rise. The Trustees further considered that, in contrast, breakpoints are a proxy for charging higher fees on lower asset levels and that when a fund’s assets decline, breakpoints may reverse, which causes expense ratios to increase. The Trustees also considered that, unlike the Funds’ unified fee structure, funds with “pass through” administrative fee structures may experience increased expense ratios when fixed dollar fees are charged against declining fund assets. The Trustees also considered that the unified fee protects shareholders from a rise in operating costs that may result from, among other things, PIMCO’s investments in various business enhancements and infrastructure, including those referenced above. The Trustees noted that PIMCO’s investments in these areas are extensive.
The Board concluded that the Funds’ cost structures were reasonable and that the unified fee structure inherently involves the sharing of economies of scale between PIMCO and each of the Funds, to the benefit of their respective shareholders.
6. ANCILLARY BENEFITS
The Board considered other benefits received by PIMCO and its affiliates as a result of PIMCO’s relationship with the Trust, including possible ancillary benefits to PIMCO’s institutional investment management business due to the reputation and market penetration of the Trust. The Board also considered that affiliates of PIMCO provide distribution and shareholder services to the Funds and their respective shareholders, for which they may be compensated through distribution and servicing fees paid pursuant to the Funds’ Rule 12b-1 plans or otherwise. The Board reviewed PIMCO’s soft dollar policies and procedures, noting that while PIMCO has the authority to receive the benefit of research provided by broker-dealers executing portfolio transactions on behalf of the Funds, it has adopted a policy not to enter into contractual soft dollar arrangements.
7. CONCLUSIONS
Based on their review, including their consideration of each of the factors summarized above, the Independent Trustees and the Board as a whole concluded that the nature, extent and quality of the services rendered to the Funds by PIMCO favored the renewal of the Agreements. The Independent Trustees and the Board as a whole concluded that the Agreements continued to be fair and reasonable to the Funds and their shareholders, that the Funds’ shareholders received reasonable value in return for the fees paid to PIMCO by the Funds under the Agreements, and that the renewal of the Agreements was in the best interests of the Funds and their shareholders.
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A special meeting of shareholders of the series of the Trust was held on February 5, 2016. The special meeting was held for the purpose of electing two (2) Trustees to the Trust’s Board of Trustees. Shareholders of all series of the Trust voted together on the proposal, and elected the following two (2) Trustees at the special meeting:
n | Jennifer Holden Dunbar |
n | Ronald C. Parker |
The results of the proxy solicitation on the preceding matter were as follows:
PIMCO Equity Series
Trustee Nominee | For* | Withheld* | ||||||||
Jennifer Holden Dunbar | 197,882,087 | 3,114,282 | ||||||||
Ronald C. Parker | 197,892,770 | 3,103,598 |
* | Certain series of the Trust’s shares were held by PIMCO-advised funds or accounts for which PIMCO had discretionary authority to vote proxies. Accordingly, PIMCO voted such shares in proportion to the votes of all other Trust shareholders voting on the proposal. |
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General Information
Investment Adviser and Administrator
Pacific Investment Management Company LLC
650 Newport Center Drive
Newport Beach, CA 92660
Distributor
PIMCO Investments LLC
1633 Broadway
New York, NY 10019
Custodian
State Street Bank and Trust Company
801 Pennsylvania Avenue
Kansas City, MO 64105
Transfer Agent
Boston Financial Data Services
Institutional Class, Class P, Administrative Class, Class D
330 W. 9th Street, 5th Floor
Kansas City, MO 64105
Boston Financial Data Services
Class A, Class C, Class R
P.O. Box 55060
Boston, MA 02205-5060
Legal Counsel
Dechert LLP
1900 K Street, N.W.
Washington, D.C. 20006
Independent Registered Public Accounting Firm
PricewaterhouseCoopers LLP
1100 Walnut Street, Suite 1300
Kansas City, MO 64106
This report is submitted for the general information of the shareholders of the PIMCO Equity Series.
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PES4001SAR_123115
Table of Contents
PIMCO Equity Series®
Semiannual Report
December 31, 2015
PIMCO RAE Fundamental Emerging Markets Fund
PIMCO RAE Fundamental Global Fund
PIMCO RAE Fundamental Global ex-US Fund
PIMCO RAE Fundamental International Fund
PIMCO RAE Fundamental US Fund
PIMCO RAE Fundamental US Small Fund
Share Classes
n | Institutional |
n | P |
n | A |
n | C |
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20 | ||||||
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78 | ||||||
Approval of Investment Advisory Contract and Other Agreements | 79 | |||||
83 |
Fund | Fund Summary | Schedule of Investments | ||||||
8 | 31 | |||||||
10 | 39 | |||||||
12 | 40 | |||||||
14 | 41 | |||||||
16 | 51 | |||||||
18 | 56 |
This material is authorized for use only when preceded or accompanied by the current PIMCO Equity Series prospectus. The Shareholder Reports for the other series of the PIMCO Equity Series are printed separately.
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Dear Shareholder,
Please find enclosed the Semiannual Report for the PIMCO Equity Series covering the six-month reporting period ended December 31, 2015. The following pages contain specific details about the investment performance of each fund and a discussion of the factors that most affected performance during the reporting period.
Highlights of the financial markets during the six-month reporting period include:
n | Heightened market volatility throughout the reporting period was sparked by a mix of investor concerns including geopolitical developments, monetary policy and the potential for slowing global economic growth, which generally contributed to dampened investor sentiment. In particular, increasing concern over the outlook for Chinese growth sent commodity prices and inflation expectations lower, while also negatively impacting prices of emerging market (“EM”) debt and equities. In addition, the Chinese equity market began a strong decline in June 2015, which prompted the Chinese government to prop-up equity share prices and devalue the Chinese yuan. Volatility in Chinese equity markets continued into January 2016 on renewed concern over slowing Chinese economic growth. Furthermore, rising tension in the Middle East and the continued debt crisis in Greece also contributed to investor unease throughout the reporting period. |
n | Economic data in the U.S. continued to confirm a healthy economy, particularly labor market indicators such as employment and wages. Still, signs of caution remained, particularly as U.S. consumers appeared to be more selective in their spending and chose to save rather than spend their windfall from lower gas prices. Additionally, consumer sentiment and certain housing indicators softened towards the end of the reporting period, and December 2015 U.S. manufacturing data indicated the fastest contraction in six years. Within the Eurozone, volatility increased despite gradual improvement in the underlying economies. Eurozone economic data also showed generally positive signs of an early recovery but were tempered slightly by sluggish inflation. |
n | The theme of divergent global central bank monetary policy continued throughout the reporting period. The European Central Bank (“ECB”) expressed its commitment to increase quantitative easing (or large-scale asset purchases), along with the Bank of Japan and the People’s Bank of China who also indicated their intent to accelerate such measures. The Federal Reserve (“Fed”), on the other hand, moved on December 16 to raise the Federal Funds Rate by 0.25% to a new range of 0.25% – 0.50%, marking its first rate hike in nine years. However, the Fed noted that future increases in its target rate would be “gradual” and in-line with their previous projections, which helped to ease investor concerns. Outside of the reporting period on January 27, the Fed opted to leave the Federal Funds Rate unchanged, noting their intent to closely monitor how the global economy and markets influence the U.S. economic outlook. |
n | U.S. equities, as represented by the S&P 500 Index, returned 0.15% due to an improving economic outlook and stronger jobs growth. Internationally, equity markets experienced weak performance, as the MSCI EAFE Net Dividend Index (USD Hedged) declined 3.13% and the MSCI EAFE Net Dividend Index (USD Unhedged) declined 6.01% over the reporting period. During the first half of the reporting period, declining commodities prices and China’s economic deceleration drove concerns of slowing global growth, which weighed on equities. However, in the last half of the reporting period, developed market equities rebounded from lows reached in the first half as the theme of diverging monetary policy came into focus with the Federal Reserve raising interest rates for the first time in nearly a decade, while central banks around the world continued to implement accommodative monetary policies. |
n | Emerging market (“EM”) equities, as represented by the MSCI Emerging Markets Index (Net Dividends in USD), declined 17.36% over the reporting period. Concerns over China’s struggling economy continued as weak data and several attempts to support the Chinese equity market by the People’s Bank of China added to fears of slowing global growth. In addition, Brazil’s economic and political woes continued over the reporting period as the country’s credit rating was downgraded by S&P and Fitch to sub-investment grade, while President Dilma Rousseff faced increased scrutiny over her ability to revive the country’s economy. |
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n | Style-wise, growth equities outperformed value equities globally as the MSCI All Country World Growth Index (Net Dividends in USD) declined 3.13% and the MSCI All Country World Value Index (Net Dividends in USD) declined 6.68%. In general, the consumer staples and information technology sectors were the top performing equity sectors, while the energy and materials sectors were the worst performing equity sectors over the reporting period. |
n | U.S. Treasuries, as represented by the Barclays U.S. Treasury Index, returned 0.81% for the reporting period. Longer-maturity yields (i.e., ten to thirty year yields) declined, with prices therefore higher, while shorter-maturity yields (i.e., six month to seven year yields) rose. The benchmark ten-year U.S. Treasury note yielded 2.27% at the end of the reporting period, down from 2.35% on June 30, 2015. The Barclays U.S. Aggregate Index, a widely used index of U.S. investment-grade bonds, returned 0.65% for the reporting period. |
If you have any questions regarding the PIMCO Equity Series, please contact your account manager or financial adviser, or call one of our shareholder associates at 888.87.PIMCO (888.877.4626). We also invite you to visit our website at www.pimco.com to learn more about our views and global thought leadership.
Thank you again for the trust you have placed in us. We value your commitment and will continue to work diligently to meet your broad investment needs.
![]() | Sincerely,
Brent R. Harris Chairman of the Board,
February 22, 2016
|
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Important Information About the Funds
We believe that equity funds have an important role to play in a well diversified investment portfolio. It is important to note, however, that equity funds are subject to notable risks. Among other things, equity and equity-related securities may decline in value due to both real and perceived general market, economic, and industry conditions.
The PIMCO RAE Fundamental Global Fund and PIMCO RAE Fundamental Global ex-US Fund are each “fund of funds,” which is a term used to describe mutual funds that pursue their investment objective by investing in other mutual funds instead of investing directly in stocks or bonds of other issuers. Under normal circumstances, the PIMCO RAE Fundamental Global Fund invests substantially all of its assets in Institutional Class shares of the PIMCO RAE Fundamental US Fund, PIMCO RAE Fundamental International Fund (“International Fund”) and PIMCO RAE Fundamental Emerging Markets Fund (“Emerging Markets Fund”) (collectively, “Underlying Funds”), and equity securities that are eligible investments for the Underlying Funds. Under normal circumstances, the PIMCO RAE Fundamental Global ex-US Fund invests substantially all of its assets in Institutional Class shares of the International Fund and Emerging Markets Fund, equity securities of small companies economically tied to non-U.S. countries, and securities that are eligible investments for the International Fund and Emerging Markets Fund. The PIMCO RAE Fundamental Global Fund and PIMCO RAE Fundamental Global ex-US Fund may invest in other affiliated funds and unaffiliated funds, which may or may not be registered under the Investment Company Act of 1940 (together with the Underlying Funds, “Acquired Funds”). The cost of investing in these Funds will generally be higher than the cost of investing in a mutual fund that invests directly in individual stocks and bonds.
The values of equity securities, such as common stocks and preferred stocks, have historically risen and fallen in periodic cycles and may decline due to general market conditions, which are not specifically related to a particular company, such as real or perceived adverse economic conditions, changes in the general outlook for corporate earnings, changes in interest or currency rates or adverse investor sentiment generally. Equity securities may also decline due to factors that affect a particular industry or industries, such as labor shortages, increased production costs and competitive conditions within an industry. In addition, the value of an equity security may decline for a number of reasons that directly relate to the issuer, such as management performance, financial leverage and reduced demand for the issuer’s goods or services, as well as the historical and prospective earnings of the issuer and the value of its assets. Different types of equity securities may react differently to these developments and a change in the financial condition of a single issuer may affect securities markets as a whole.
During a general downturn in the securities markets, multiple asset classes, including equity securities, may decline in value simultaneously. The market price of equity securities owned by a Fund may go up or down, sometimes rapidly or unpredictably. Equity securities generally have greater price volatility than fixed income securities and common stocks generally have the greatest appreciation and depreciation potential of all corporate securities.
The Funds may be subject to various risks as described in the Funds’ prospectus. Some of these risks may include, but are not limited to, the following: new/small fund risk, allocation risk, Acquired Fund risk, equity risk, value investing risk, foreign (non-U.S.) investment risk, emerging markets risk, issuer non-diversification risk, market risk, issuer risk, credit risk, distressed company risk, currency risk, liquidity risk, leveraging risk, management risk, small company risk, arbitrage risk, derivatives risk and model risk. A complete description of these and other risks is contained in the Funds’ prospectus.
The Funds may use derivative instruments for hedging purposes or as part of an investment strategy. Use of these instruments may involve certain costs and risks such as liquidity risk, interest rate risk, market risk, credit risk, leverage risk, management risk and the risk that a Fund may not be able to close out a position when it would be most advantageous to do so. Certain derivative transactions may have a leveraging effect on a Fund. For example, a small investment in a derivative instrument may have a significant impact on a Fund’s exposure to interest rates, currency exchange rates or other investments. As a result, a relatively small price movement in an asset, instrument or component of the index underlying a derivative instrument may cause an immediate and substantial loss or gain, which translates into heightened volatility for the Funds. A Fund may engage in such transactions regardless of whether the Fund owns the asset, instrument or components of the index underlying the derivative instrument. A Fund may invest a significant portion of its assets in these types of instruments. If it does, the Fund’s investment exposure could far exceed the value of its portfolio securities and its investment performance could be primarily dependent upon securities it does not own. Investing in foreign (non-U.S.) securities may entail risk due to foreign (non-U.S.) economic and political developments; this risk may be increased when investing in emerging markets. For example, if an Underlying Fund invests in emerging market debt, it may face increased exposure to interest rate, liquidity, volatility, and redemption risk due to the specific economic, political, geographical, or legal background of the foreign (non-U.S.) issuer.
The value of an equity security of an issuer that has paid dividends in the past may decrease if the issuer reduces or eliminates future payments to its shareholders. If the dividends or distributions received by a Fund decrease, the Fund may have less income to distribute to the
4 | PIMCO EQUITY SERIES |
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Fund’s shareholders. In addition, during certain market conditions, the equity securities of issuers that have paid regular dividends or distributions may not be widely available or may be highly concentrated in particular sectors of the market. A Fund may invest a significant portion of its assets in value stocks. Value stocks may perform differently from other types of stocks and the market as a whole. A value stock may decrease in price or may not increase in price as anticipated by PIMCO if it continues to be undervalued by the market or the factors that the portfolio manager believes will cause the stock price to increase do not occur.
The geographical classification of foreign (non-U.S.) securities in this report are classified by the country of incorporation of a holding. In certain instances, a security’s country of incorporation may be different from its country of economic exposure.
On each individual Fund Summary page in this Shareholder Report, the Average Annual Total Return table and Cumulative Returns chart measure performance assuming that any dividend and capital gain distributions were reinvested. Class A shares are subject to an initial sales charge. A Contingent Deferred Sales Charge (“CDSC”) may be imposed in certain circumstances on Class A shares that are purchased without an initial sales charge and then redeemed during the first (i) 18 months after
purchase for purchases made prior to August 10, 2015 and (ii) 12 months after purchase for purchases made on or after August 10, 2015. The Cumulative Returns chart reflects only Institutional Class performance. Performance for Class P, Administrative Class, Class D, Class A, Class C and Class R shares, if applicable, are typically lower than Institutional Class performance due to the lower expenses paid by Institutional Class shares. Performance shown is net of fees and expenses. A Fund’s total annual operating expense ratios on each individual Fund Summary page are as of the currently effective prospectus, as supplemented to date. The Cumulative Returns chart assumes the initial investment of $1,000,000 was made at the end of the month that the Institutional Class of the relevant Fund commenced operations. The minimum initial investment amount for Institutional Class, Class P and Administrative Class shares is $1,000,000. The minimum initial investment amount for Class A, Class C and Class D shares is $1,000. There is no minimum initial investment for Class R shares. Each Fund measures its performance against a broad-based securities market index (“benchmark index”). The benchmark index does not take into account fees, expenses, or taxes. A Fund’s past performance, before and after taxes, is not necessarily an indication of how the Fund will perform in the future.
The following table discloses the inception dates of each Fund and its respective share classes along with the Fund’s diversification status as of period end:
Fund Name | Fund Inception | Institutional Class | Class P | Administrative Class | Class D | Class A | Class C | Class R | Diversification Status | |||||||||||||||||||||||||||||
PIMCO RAE Fundamental Emerging Markets Fund | 06/05/15 | 06/05/15 | — | — | — | 06/05/15 | 06/05/15 | — | Non-diversified | |||||||||||||||||||||||||||||
PIMCO RAE Fundamental Global Fund | 06/05/15 | 06/05/15 | — | — | — | 06/05/15 | 06/05/15 | — | Non-diversified | |||||||||||||||||||||||||||||
PIMCO RAE Fundamental Global ex-US Fund | 06/05/15 | 06/05/15 | — | — | — | 06/05/15 | 06/05/15 | — | Non-diversified | |||||||||||||||||||||||||||||
PIMCO RAE Fundamental International Fund | 06/05/15 | 06/05/15 | — | — | — | 06/05/15 | 06/05/15 | — | Non-diversified | |||||||||||||||||||||||||||||
PIMCO RAE Fundamental US Fund | 06/05/15 | 06/05/15 | — | — | — | 06/05/15 | 06/05/15 | — | Non-diversified | |||||||||||||||||||||||||||||
PIMCO RAE Fundamental US Small Fund | 06/05/15 | 06/05/15 | — | — | — | 06/05/15 | 06/05/15 | — | Non-diversified |
An investment in a Fund is not a bank deposit and is not guaranteed or insured by the Federal Deposit Insurance Corporation (“FDIC”) or any other government agency. It is possible to lose money on investments in a Fund.
The Trustees are responsible generally for overseeing the management of the Trust. The Trustees authorize the Trust to enter into service agreements with the Adviser, the Distributor, the Administrator and other service providers in order to provide, and in some cases authorize service providers to procure through other parties, necessary or desirable services on behalf of the Trust and the Funds. Shareholders are not parties to or third-party beneficiaries of such service agreements. Neither a Fund’s prospectus nor a Fund’s summary prospectus, the Trust’s Statement of Additional Information (“SAI”), any contracts filed as exhibits to the Trust’s registration statement, nor
any other communications, disclosure documents or regulatory filings (including this report) from or on behalf of the Trust or a Fund creates a contract between or among any shareholder of a Fund, on the one hand, and the Trust, a Fund, a service provider to the Trust or a Fund, and/or the Trustees or officers of the Trust, on the other hand. The Trustees (or the Trust and its officers, service providers or other delegates acting under authority of the Trustees) may amend the most recent prospectus or use a new prospectus, summary prospectus or SAI with respect to a Fund or the Trust, and/or amend, file and/or issue any other communications, disclosure documents or regulatory filings, and may amend or enter into any contracts to which the Trust or a Fund is a party, and interpret the investment objective(s), policies, restrictions and contractual provisions applicable to any Fund, without shareholder input or approval, except in circumstances in which shareholder approval is specifically required by law (such as changes to
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Important Information About the Funds (Cont.)
fundamental investment policies) or where a shareholder approval requirement is specifically disclosed in the Trust’s then-current prospectus or SAI.
PIMCO has adopted written proxy voting policies and procedures (“Proxy Policy”) as required by Rule 206(4)-6 under the Investment Advisers Act of 1940, as amended. The Proxy Policy has been adopted by PIMCO Equity Series as the policies and procedures that PIMCO will use when voting proxies on behalf of a Fund. A description of the policies and procedures that PIMCO uses to vote proxies relating to portfolio securities of a Fund, and information about how the Fund voted proxies relating to portfolio securities held during the most recent twelve-month period ended June 30th, are available without charge,
upon request, by calling the Trust at (888) 87-PIMCO, on the Fund’s website at www.pimco.com, and on the Securities and Exchange Commission’s (“SEC”) website at www.sec.gov.
PIMCO Equity Series files a complete schedule of each Fund’s portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. A copy of a Fund’s Form N-Q is available on the SEC’s website at www.sec.gov and may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. A Fund’s Form N-Q will also be available without charge, upon request, by calling the Trust at (888) 87-PIMCO and on the Fund’s website at www.pimco.com. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.
6 | PIMCO EQUITY SERIES |
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SEMIANNUAL REPORT | DECEMBER 31, 2015 | 7 |
Table of Contents
PIMCO RAE Fundamental Emerging Markets Fund
Cumulative Returns Through December 31, 2015*
Investment Objective and Strategy Overview
» | The PIMCO RAE Fundamental Emerging Markets Fund seeks long-term capital appreciation by investing under normal circumstances at least 80% of its assets in investments that are economically tied to emerging market countries. Specifically, under normal circumstances, the Fund will obtain exposure to a portfolio of stocks economically tied to emerging market countries (“RAE Fundamental Emerging Markets Portfolio”). The stocks are selected by the Fund’s subadviser, Research Affiliates, LLC (“Sub-Adviser”), from a broad universe of companies which satisfy certain liquidity and capacity requirements. |
Cumulative Total Return for the period ended December 31, 2015* | ||||||||||||||||||
6 Months** | 1 Year | 5 Year | Fund Inception (05/31/06) | |||||||||||||||
![]() | PIMCO RAE Fundamental Emerging Markets Fund Institutional Class | (22.85)% | (23.44)% | (6.99)% | 3.07% | |||||||||||||
PIMCO RAE Fundamental Emerging Markets Fund Class P | (22.98)% | (23.49)% | (7.00)% | 3.07% | ||||||||||||||
PIMCO RAE Fundamental Emerging Markets Fund Class A | (23.00)% | (23.51)% | (7.00)% | 3.06% | ||||||||||||||
PIMCO RAE Fundamental Emerging Markets Fund Class A (adjusted) | (25.90)% | (26.38)% | (7.71)% | 2.65% | ||||||||||||||
PIMCO RAE Fundamental Emerging Markets Fund Class C | (23.30)% | (23.88)% | (7.09)% | 3.01% | ||||||||||||||
PIMCO RAE Fundamental Emerging Markets Fund Class C (adjusted) | (24.05)% | (24.63)% | (7.09)% | 3.01% | ||||||||||||||
![]() | MSCI Emerging Markets Index (Net Dividends in USD)± | (17.36)% | (14.92)% | (4.81)% | 3.00% |
All Fund returns are net of fees and expenses.
** Cumulative return.
± The MSCI Emerging Markets Index (Net Dividends in USD) Index is a free float-adjusted market capitalization index that is designed to measure equity market performance of emerging markets.
It is not possible to invest directly in an unmanaged index.
Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Current performance may be lower or higher than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The adjusted returns take into account the maximum sales charge of 3.75% on Class A shares and 1.00% CDSC on Class C shares. The Fund’s total annual operating expense ratio as stated in the Fund’s current prospectus, as supplemented to date, is 0.95% for the Institutional Class shares, 1.05% for the Class P shares, 1.30% for the Class A shares and 2.05% for the Class C shares. Details regarding any Fund’s operating expenses can be found in the Fund’s prospectus. For performance current to the most recent month-end, visit www.pimco.com.
* For periods prior to June 5, 2015, the Fund’s performance reflects the performance when the Fund was a partnership, net of actual fees and expenses charged to individual partnership accounts in the aggregate. If the performance had been restated to reflect the applicable fees and expenses of each share class, the performance may have been higher or lower. The Fund began operations as a partnership on May 31, 2006 and, on June 5, 2015, was reorganized into a newly-formed fund that was registered as an investment company under the Investment Company Act of 1940. Prior to the reorganization, the Fund had an investment objective, investment strategies, investment guidelines, and restrictions that were substantially similar to those currently applicable to the Fund; however, the Fund was not registered as an investment company under the Investment Company Act of 1940 and was not subject to its requirements or requirements imposed by the Internal Revenue Code of 1986 which, if applicable, may have adversely affected its performance. The performance of each class of shares will differ as a result of the different levels of fees and expenses applicable to each class of shares.
8 | PIMCO EQUITY SERIES |
Table of Contents
Institutional Class - PEIFX | Class P - PEPFX | Class A - PEAFX | Class C - PECFX |
Top 10 Holdings1
China Construction Bank Corp. ‘H’ | 3.7% | |||||
Samsung Electronics Co. Ltd. | 3.3% | |||||
Gazprom PAO SP — ADR | 3.1% | |||||
Industrial & Commercial Bank of China Ltd. ‘H’ | 3.0% | |||||
China Mobile Ltd. | 2.8% | |||||
Lukoil PJSC SP — ADR | 2.7% | |||||
Bank of China Ltd. ‘H’ | 2.5% | |||||
Vale S.A. | 2.2% | |||||
Surgutneftegas OAO SP — ADR | 2.1% | |||||
Taiwan Semiconductor Manufacturing Co. Ltd. SP — ADR | 1.9% |
Geographic Breakdown1
China | 20.9% | |||||
South Korea | 14.4% | |||||
Russia | 13.9% | |||||
Brazil | 13.0% | |||||
South Africa | 8.9% | |||||
Taiwan | 8.1% | |||||
Hong Kong | 5.6% | |||||
Mexico | 3.2% | |||||
Thailand | 2.8% | |||||
Poland | 2.3% | |||||
Indonesia | 1.7% | |||||
Luxembourg | 1.5% | |||||
India | 1.4% | |||||
Ireland | 1.0% | |||||
Other | 1.3% |
1 % of Investments, at value as of 12/31/2015. Top 10 Holdings and Geographic Breakdown solely reflect long positions. Securities sold short, financial derivative instruments and short-term instruments are not taken into consideration.
Fund Insights
» | The Fund commenced operations on June 5, 2015. |
» | The Fund’s value orientation detracted from performance, as MSCI Emerging Market value stocks underperformed the MSCI Emerging Market Index over the reporting period. |
» | An overweight exposure to the metals & mining industry detracted from relative performance, as this industry significantly underperformed the MSCI Emerging Market Index over the reporting period. |
» | An overweight exposure to Brazil detracted from relative performance, as Brazil significantly underperformed the MSCI Emerging Market Index over the reporting period. |
» | An underweight exposure to the industrials sector positively contributed to relative performance, as the sector underperformed the MSCI Emerging Market Index over the reporting period. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 9 |
Table of Contents
PIMCO RAE Fundamental Global Fund
Cumulative Returns Through December 31, 2015
Investment Objective and Strategy Overview
» | The PIMCO RAE Fundamental Global Fund seeks long-term capital appreciation by investing under normal circumstances substantially all of its assets in (i) Institutional Class shares of the PIMCO RAE Fundamental US Fund (“US Fund”), the PIMCO RAE Fundamental International Fund (“International Fund”), and the PIMCO RAE Fundamental Emerging Markets Fund (“Emerging Markets Fund”) (together, the US Fund, the International Fund and the Emerging Markets Fund are referred to as the “Underlying Funds”) and (ii) equity securities that are eligible investments for the Underlying Funds. Under normal circumstances, each of the Underlying Funds obtains exposure to a portfolio of stocks (each, a “RAE Fundamental Portfolio”). The stocks are selected by the Fund’s sub-adviser, Research Affiliates, LLC (“Sub-Adviser”), from a broad universe of companies which satisfy certain liquidity and capacity requirements. |
Cumulative Total Return for the period ended December 31, 2015 | ||||||||||
6 Months* | Fund Inception (06/05/15) | |||||||||
![]() | PIMCO RAE Fundamental Global Fund Institutional Class | (8.38)% | (9.66)% | |||||||
PIMCO RAE Fundamental Global Fund Class P | (8.34)% | (9.72)% | ||||||||
PIMCO RAE Fundamental Global Fund Class A | (8.41)% | (9.78)% | ||||||||
PIMCO RAE Fundamental Global Fund Class A (adjusted) | (11.81)% | (13.17)% | ||||||||
PIMCO RAE Fundamental Global Fund Class C | (8.68)% | (10.14)% | ||||||||
PIMCO RAE Fundamental Global Fund Class C (adjusted) | (9.58)% | (11.03)% | ||||||||
![]() | MSCI All Country World Index± | (4.90)% | (6.06)% |
All Fund returns are net of fees and expenses.
* Cumulative return.
± The MSCI All Country World Index is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed and emerging markets. The Index consists of 46 country indices comprising 23 developed and 23 emerging market country indices.
It is not possible to invest directly in the index.
Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Current performance may be lower or higher than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The adjusted returns take into account the maximum sales charge of 3.75% on Class A shares and 1.00% CDSC on Class C shares. The Fund’s total annual operating expense ratio as stated in the Fund’s current prospectus, as supplemented to date, is 1.18% for the Institutional Class shares, 1.28% for the Class P shares, 1.53% for the Class A shares and 2.28% for the Class C shares. Details regarding any Fund’s operating expenses can be found in the Fund’s prospectus. For performance current to the most recent month-end, visit www.pimco.com.
10 | PIMCO EQUITY SERIES |
Table of Contents
Institutional Class - PFQIX | Class P - PFQPX | Class A - PFQAX | Class C - PFQCX |
Top Holdings1
PIMCO RAE Fundamental US Fund | 55.5% | |||||
PIMCO RAE Fundamental International Fund | 35.7% | |||||
PIMCO RAE Fundamental Emerging Markets Fund | 8.8% |
Sector Breakdown1
Mutual Funds | 100.0% |
1 % of Investments, at value as of 12/31/2015. Top Holdings and Sector Breakdown solely reflect long positions. Securities sold short, financial derivative instruments and short-term instruments are not taken into consideration.
Fund Insights
» | The Fund commenced operations on June 5, 2015. |
» | The Fund’s value orientation detracted from performance, as MSCI ACWI value stocks underperformed the MSCI ACWI Index over the reporting period. |
» | An overweight exposure to the energy sector detracted from relative performance, as this sector significantly underperformed the MSCI ACWI over the reporting period. |
» | An overweight exposure to the metals & mining industry detracted from relative performance, as this industry significantly underperformed the MSCI ACWI over the reporting period. |
» | An overweight exposure to the diversified telecommunication services industry contributed to relative performance, as this sector outperformed the MSCI ACWI over the reporting period. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 11 |
Table of Contents
PIMCO RAE Fundamental Global ex-US Fund
Cumulative Returns Through December 31, 2015
Investment Objective and Strategy Overview
» | The PIMCO RAE Fundamental Global ex-US Fund seeks long-term capital appreciation by investing under normal circumstances substantially all of its assets in (i) Institutional Class shares of the PIMCO RAE Fundamental International Fund (“International Fund”) and the PIMCO RAE Fundamental Emerging Markets Fund (“Emerging Markets Fund”) (together, the International Fund and the Emerging Markets Fund are referred to as the “Underlying Funds”), (ii) equity securities of small companies economically tied to non-U.S. countries, and (iii) securities that are eligible investments for the Underlying Funds. Under normal circumstances, each of the Underlying Funds obtains exposure to a portfolio of stocks (each, a “RAE Fundamental Portfolio”). The stocks are selected by the Fund’s sub-adviser, Research Affiliates, LLC (“Sub-Adviser”), from a broad universe of companies which satisfy certain liquidity and capacity requirements. |
Cumulative Total Return for the period ended December 31, 2015 | ||||||||||
6 Months* | Fund Inception (06/05/15) | |||||||||
![]() | PIMCO RAE Fundamental Global ex-US Fund Institutional Class | (12.98)% | (14.20)% | |||||||
PIMCO RAE Fundamental Global ex-US Fund Class P | (13.02)% | (14.24)% | ||||||||
PIMCO RAE Fundamental Global ex-US Fund Class A | (13.13)% | (14.35)% | ||||||||
PIMCO RAE Fundamental Global ex-US Fund Class A (adjusted) | (16.36)% | (17.56)% | ||||||||
PIMCO RAE Fundamental Global ex-US Fund Class C | (13.43)% | (14.73)% | ||||||||
PIMCO RAE Fundamental Global ex-US Fund Class C (adjusted) | (14.29)% | (15.58)% | ||||||||
![]() | MSCI All Country World ex US Index± | (9.32)% | (10.33)% |
All Fund returns are net of fees and expenses.
* Cumulative return.
± The MSCI All Country World ex US Index is a free float-adjusted market capitalization weighted index that is designed to measure the equity market performance of developed and emerging markets. The Index consists of 45 country indices comprising 22 developed and 23 emerging market country indices.
It is not possible to invest directly in an unmanaged index.
Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Current performance may be lower or higher than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The adjusted returns take into account the maximum sales charge of 3.75% on Class A shares and 1.00% CDSC on Class C shares. The Fund’s total annual operating expense ratio as stated in the Fund’s current prospectus, as supplemented to date, is 1.31% for the Institutional Class shares, 1.41% for the Class P shares, 1.66% for the Class A shares and 2.41% for the Class C shares. Details regarding any Fund’s operating expenses can be found in the Fund’s prospectus. For performance current to the most recent month-end, visit www.pimco.com.
12 | PIMCO EQUITY SERIES |
Table of Contents
Institutional Class - PZRIX | Class P - PZRPX | Class A - PZRAX | Class C - PZRCX |
Top Holdings1
PIMCO RAE Fundamental International Fund | 80.4% | |||||
PIMCO RAE Fundamental Emerging Markets Fund | 19.6% |
Sector Breakdown1
Mutual Funds | 100.0% |
1 % of Investments, at value as of 12/31/2015. Top Holdings and Sector Breakdown solely reflect long positions. Securities sold short, financial derivative instruments and short-term instruments are not taken into consideration.
Fund Insights
» | The Fund commenced operations on June 5, 2015. |
» | The Fund’s value orientation detracted from performance, as MSCI All Country World ex-US value stocks underperformed the MSCI All Country World ex-US Index over the reporting period. |
» | An overweight exposure to the energy sector detracted from relative performance, as this sector significantly underperformed the MSCI All Country World ex-US Index over the reporting period. |
» | An overweight exposure to the metals & mining industry detracted from relative performance, as this industry significantly underperformed the MSCI All Country World ex-US Index over the reporting period. |
» | Overweight exposure to the diversified telecommunication services industry contributed to relative performance as this sector outperformed the MSCI All Country World ex-US Index over the reporting period. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 13 |
Table of Contents
PIMCO RAE Fundamental International Fund
Cumulative Returns Through December 31, 2015
Investment Objective and Strategy Overview
» | The PIMCO RAE Fundamental International Fund seeks long-term capital appreciation by investing under normal circumstances by obtaining exposure to a portfolio of stocks economically tied to at least three foreign (non-U.S.) countries (“RAE Fundamental International Portfolio”). The stocks are selected by the Fund’s sub-adviser, Research Affiliates, LLC (“Sub-Adviser”), from a broad universe of companies which satisfy certain liquidity and capacity requirements. |
Cumulative Total Return for the period ended December 31, 2015 | ||||||||||
6 Months* | Fund Inception (06/05/15) | |||||||||
![]() | PIMCO RAE Fundamental International Fund Institutional Class | (9.66)% | (11.20)% | |||||||
PIMCO RAE Fundamental International Fund Class P | (9.65)% | (11.19)% | ||||||||
PIMCO RAE Fundamental International Fund Class A | (9.80)% | (11.34)% | ||||||||
PIMCO RAE Fundamental International Fund Class A (adjusted) | (13.16)% | (14.67)% | ||||||||
PIMCO RAE Fundamental International Fund Class C | (10.23)% | (11.76)% | ||||||||
PIMCO RAE Fundamental International Fund Class C (adjusted) | (11.11)% | (12.62)% | ||||||||
![]() | MSCI EAFE Net Dividend Index (USD Unhedged)± | (6.01)% | (7.08)% |
All Fund returns are net of fees and expenses.
* Cumulative return.
± MSCI EAFE Net Dividend Index (USD Unhedged) is an unmanaged index of issuers in countries of Europe, Australia, and the Far East represented in U.S. Dollars on a unhedged basis.
It is not possible to invest directly in an unmanaged index.
Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Current performance may be lower or higher than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The adjusted returns take into account the maximum sales charge of 3.75% on Class A shares and 1.00% CDSC on Class C shares. The Fund’s total annual operating expense ratio as stated in the Fund’s current prospectus, as supplemented to date, is 0.60% for the Institutional Class shares, 0.70% for the Class P shares, 0.95% for the Class A shares and 1.70% for the Class C shares. Details regarding any Fund’s operating expenses can be found in the Fund’s prospectus. For performance current to the most recent month-end, visit www.pimco.com.
14 | PIMCO EQUITY SERIES |
Table of Contents
Institutional Class - PPYIX | Class P - PPYPX | Class A - PPYAX | Class C - PPYCX |
Top 10 Holdings1
HSBC Holdings PLC | 2.1% | |||||
Royal Dutch Shell PLC ‘A’ | 2.1% | |||||
Total S.A. | 1.5% | |||||
BP PLC | 1.5% | |||||
Orange S.A. | 1.3% | |||||
Banco Santander S.A. | 1.0% | |||||
Engie S.A. | 1.0% | |||||
Novartis AG | 0.9% | |||||
Westpac Banking Corp. | 0.9% | |||||
Telefonica S.A. | 0.9% |
Geographic Breakdown1
United Kingdom | 17.1% | |||||
Japan | 14.3% | |||||
France | 11.6% | |||||
Germany | 10.2% | |||||
Australia | 9.3% | |||||
Canada | 8.3% | |||||
Switzerland | 5.3% | |||||
Netherlands | 4.5% | |||||
Spain | 3.4% | |||||
Italy | 3.1% | |||||
Sweden | 2.1% | |||||
Hong Kong | 1.9% | |||||
Denmark | 1.4% | |||||
Norway | 1.2% | |||||
Singapore | 1.1% | |||||
Ireland | 1.0% | |||||
Belgium | 1.0% | |||||
Other | 3.2% |
1 % of Investments, at value as of 12/31/2015. Top 10 Holdings and Geographic Breakdown solely reflect long positions. Securities sold short, financial derivative instruments and short-term instruments are not taken into consideration.
Fund Insights
» | The Fund commenced operations on June 5, 2015. |
» | The Fund’s value orientation detracted from performance, as MSCI EAFE value stocks underperformed the MSCI EAFE Index over the reporting period. |
» | An overweight exposure to the energy sector detracted from relative performance, as this sector significantly underperformed the MSCI EAFE Index over the reporting period. |
» | An underweight exposure to the consumer staples sector detracted from relative performance, as this sector significantly outperformed the MSCI EAFE Index over the reporting period. |
» | An overweight exposure to the diversified telecommunication services industry contributed to relative performance, as this sector outperformed the MSCI EAFE Index over the reporting period. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 15 |
Table of Contents
Cumulative Returns Through December 31, 2015*
Investment Objective and Strategy Overview
» | The PIMCO RAE Fundamental US Fund seeks long-term capital appreciation by investing under normal circumstances at least 80% of its assets in securities of U.S. companies. Specifically, under normal circumstances, the Fund will obtain exposure to a portfolio of stocks of U.S. companies (“RAE Fundamental US Portfolio”). The stocks are selected by the Fund’s sub-adviser, Research Affiliates, LLC (“Sub-Adviser”), from a broad universe of companies which satisfy certain liquidity and capacity requirements. |
Cumulative Total Return for the period ended December 31, 2015* | ||||||||||||||||||||||
6 Months** | 1 Year | 5 Year | 10 Year | Fund Inception (12/22/04) | ||||||||||||||||||
![]() | PIMCO RAE Fundamental US Fund Institutional Class | (2.72)% | (3.25)% | 11.92% | 7.44% | 7.31% | ||||||||||||||||
PIMCO RAE Fundamental US Fund Class P | (2.79)% | (3.33)% | 11.90% | 7.43% | 7.30% | |||||||||||||||||
PIMCO RAE Fundamental US Fund Class A | (2.99)% | (3.42)% | 11.88% | 7.42% | 7.29% | |||||||||||||||||
PIMCO RAE Fundamental US Fund Class A (adjusted) | (6.59)% | (7.04)% | 11.03% | 7.01% | 6.92% | |||||||||||||||||
PIMCO RAE Fundamental US Fund Class C | (3.46)% | (3.99)% | 11.75% | 7.35% | 7.23% | |||||||||||||||||
PIMCO RAE Fundamental US Fund Class C (adjusted) | (4.39)% | (4.92)% | 11.75% | 7.35% | 7.23% | |||||||||||||||||
![]() | S&P 500 Index± | 0.15% | 1.38% | 12.57% | 7.31% | 7.09% | *** |
All Fund returns are net of fees and expenses.
** Cumulative return.
*** Average annual total return since 12/31/2004.
± S&P 500 Index is an unmanaged market index generally considered representative of the stock market as a whole. The Index focuses on the large-cap segment of the U.S. equities market.
It is not possible to invest directly in an unmanaged index.
Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Current performance may be lower or higher than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The adjusted returns take into account the maximum sales charge of 3.75% on Class A shares and 1.00% CDSC on Class C shares. The Fund’s total annual operating expense ratio as stated in the Fund’s current prospectus, as supplemented to date, is 0.50% for the Institutional Class shares, 0.60% for the Class P shares, 0.90% for the Class A shares and 1.65% for the Class C shares. Details regarding any Fund’s operating expenses can be found in the Fund’s prospectus. For performance current to the most recent month-end, visit www.pimco.com.
* For periods prior to June 5, 2015, the Fund’s performance reflects the performance when the Fund was a partnership, net of actual fees and expenses charged to individual partnership accounts in the aggregate. If the performance had been restated to reflect the applicable fees and expenses of each share class, the performance may have been higher or lower. The Fund began operations as a partnership on December 22, 2004 and, on June 5, 2015, was reorganized into a newly-formed fund that was registered as an investment company under the Investment Company Act of 1940. Prior to the reorganization, the Fund had an investment objective, investment strategies, investment guidelines, and restrictions that were substantially similar to those currently applicable to the Fund; however, the Fund was not registered as an investment company under the Investment Company Act of 1940 and was not subject to its requirements or requirements imposed by the Internal Revenue Code of 1986 which, if applicable, may have adversely affected its performance. The performance of each class of shares will differ as a result of the different levels of fees and expenses applicable to each class of shares.
16 | PIMCO EQUITY SERIES |
Table of Contents
Institutional Class - PKAIX | Class P - PKAPX | Class A - PKAAX | Class C - PKACX |
Top 10 Holdings1
AT&T, Inc. | 3.2% | |||||
Exxon Mobil Corp. | 2.8% | |||||
International Business Machines Corp. | 2.3% | |||||
Apple, Inc. | 2.3% | |||||
Chevron Corp. | 2.2% | |||||
JPMorgan Chase & Co. | 2.1% | |||||
Microsoft Corp. | 2.0% | |||||
Intel Corp. | 1.8% | |||||
Pfizer, Inc. | 1.3% | |||||
Verizon Communications, Inc. | 1.3% |
Sector Breakdown1
Information Technology | 20.3% | |||||
Consumer Discretionary | 15.1% | |||||
Financials | 13.2% | |||||
Health Care | 12.1% | |||||
Consumer Staples | 9.7% | |||||
Energy | 9.2% | |||||
Industrials | 7.6% | |||||
Utilities | 5.7% | |||||
Telecommunication Services | 5.4% | |||||
Materials | 1.7% |
1 % of Investments, at value as of 12/31/2015. Top 10 Holdings and Sector Breakdown solely reflect long positions. Securities sold short, financial derivative instruments and short-term instruments are not taken into consideration.
Fund Insights
» | The Fund commenced operations on June 5, 2015. |
» | The Fund’s value orientation detracted from performance, as S&P 500 value stocks underperformed the S&P 500 Index over the reporting period. |
» | An underweight exposure to the internet & catalog retail industry, most notably an underweight to Amazon.com, detracted from relative performance, as this industry and stock significantly outperformed the S&P 500 Index over the reporting period. |
» | An overweight exposure to the oil, gas & consumable fuels industry detracted from relative performance, as this industry significantly underperformed the S&P 500 Index over the reporting period. |
» | An overweight exposure to the utilities sector positively contributed to relative performance, as the sector significantly outperformed the S&P 500 Index over the reporting period. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 17 |
Table of Contents
PIMCO RAE Fundamental US Small Fund
Cumulative Returns Through December 31, 2015*
Investment Objective and Strategy Overview
» | The PIMCO RAE Fundamental US Small Fund seeks long-term capital appreciation by investing under normal circumstances at least 80% of its assets in securities of U.S. small companies. Specifically, under normal circumstances, the Fund will obtain exposure to a portfolio of stocks of U.S. small companies (“RAE Fundamental US Small Portfolio”). The stocks are selected by the Fund’s sub-adviser, Research Affiliates, LLC (“Sub-Adviser”), from a broad universe of companies which satisfy certain liquidity and capacity requirements. |
Cumulative Total Return for the period ended December 31, 2015* | ||||||||||||||||||||||
6 Months** | 1 Year | 5 Year | 10 Year | Fund Inception (09/29/05) | ||||||||||||||||||
![]() | PIMCO RAE Fundamental US Small Fund Institutional Class | (9.19)% | (6.92)% | 9.46% | 7.14% | 7.19% | ||||||||||||||||
PIMCO RAE Fundamental US Small Fund Class P | (9.20)% | (7.03)% | 9.44% | 7.12% | 7.18% | |||||||||||||||||
PIMCO RAE Fundamental US Small Fund Class A | (9.40)% | (7.24)% | 9.39% | 7.10% | 7.15% | |||||||||||||||||
PIMCO RAE Fundamental US Small Fund Class A (adjusted) | (12.83)% | (10.72)% | 8.55% | 6.69% | 6.75% | |||||||||||||||||
PIMCO RAE Fundamental US Small Fund Class C | (9.59)% | (7.52)% | 9.32% | 7.07% | 7.12% | |||||||||||||||||
PIMCO RAE Fundamental US Small Fund Class C (adjusted) | (10.47)% | (8.43)% | 9.32% | 7.07% | 7.12% | |||||||||||||||||
![]() | Russell 2000® Index± | (8.75)% | (4.41)% | 9.19% | 6.80% | 6.75% | *** |
All Fund returns are net of fees and expenses.
** Cumulative return.
*** Average annual total return since 9/30/2005.
± Russell 2000® Index is composed of 2,000 of the smallest companies in the Russell 3000 Index and is considered to be representative of the small cap market in general.
It is not possible to invest directly in an unmanaged index.
Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Current performance may be lower or higher than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The adjusted returns take into account the maximum sales charge of 3.75% on Class A shares and 1.00% CDSC on Class C shares. The Fund’s total annual operating expense ratio as stated in the Fund’s current prospectus, as supplemented to date, is 0.60% for the Institutional Class shares, 0.70% for the Class P shares, 1.00% for the Class A shares and 1.75% for the Class C shares. Details regarding any Fund’s operating expenses can be found in the Fund’s prospectus. For performance current to the most recent month-end, visit www.pimco.com.
* For periods prior to June 5, 2015, the Fund’s performance reflects the performance when the Fund was a partnership, net of actual fees and expenses charged to individual partnership accounts in the aggregate. If the performance had been restated to reflect the applicable fees and expenses of each share class, the performance may have been higher or lower. The Fund began operations as a partnership on September 29, 2005 and, on June 5, 2015, was reorganized into a newly-formed fund that was registered as an investment company under the Investment Company Act of 1940. Prior to the reorganization, the Fund had an investment objective, investment strategies, investment guidelines, and restrictions that were substantially similar to those currently applicable to the Fund; however, the Fund was not registered as an investment company under the Investment Company Act of 1940 and was not subject to its requirements or requirements imposed by the Internal Revenue Code of 1986 which, if applicable, may have adversely affected its performance. The performance of each class of shares will differ as a result of the different levels of fees and expenses applicable to each class of shares.
18 | PIMCO EQUITY SERIES |
Table of Contents
Institutional Class - PMJIX | Class P - PMJPX | Class A - PMJAX | Class C - PMJCX |
Top 10 Holdings1
Penn National Gaming, Inc. | 0.7% | |||||
Boyd Gaming Corp. | 0.6% | |||||
NETGEAR, Inc. | 0.5% | |||||
MedAssets, Inc. | 0.5% | |||||
EarthLink Holdings Corp. | 0.5% | |||||
WebMD Health Corp. | 0.5% | |||||
PMC-Sierra, Inc. | 0.5% | |||||
Select Medical Holdings Corp. | 0.5% | |||||
Chemed Corp. | 0.5% | |||||
Ingles Markets, Inc. ‘A’ | 0.5% |
Sector Breakdown1
Information Technology | 20.9% | |||||
Consumer Discretionary | 20.0% | |||||
Financials | 16.4% | |||||
Industrials | 14.3% | |||||
Health Care | 11.5% | |||||
Consumer Staples | 4.5% | |||||
Materials | 4.0% | |||||
Energy | 3.9% | |||||
Telecommunication Services | 2.5% | |||||
Utilities | 2.0% |
1 % of Investments, at value as of 12/31/2015. Top 10 Holdings and Sector Breakdown solely reflect long positions. Securities sold short, financial derivative instruments and short-term instruments are not taken into consideration.
Fund Insights
» | The Fund commenced operations on June 5, 2015. |
» | An underweight exposure to the financials sector detracted from relative performance, as this sector significantly outperformed the Russell 2000 Index over the reporting period. |
» | An overweight exposure to the specialty retail industry detracted from relative performance, as this industry significantly underperformed the Russell 2000 Index over the reporting period. |
» | An overweight exposure to the energy equipment & services industry detracted from relative performance, as this industry significantly underperformed the Russell 2000 Index over the reporting period. |
» | An underweight exposure to the biotechnology industry positively contributed to relative performance, as this industry significantly underperformed the Russell 2000 Index over the reporting period. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 19 |
Table of Contents
Example
As a shareholder of a Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and exchange fees and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. The Example is intended to help you understand your ongoing costs (in dollars) of investing in a Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period indicated, which for all Funds and share classes is from July 1, 2015 to December 31, 2015 unless noted otherwise in the table and footnotes below.
Actual Expenses
The information in the table under the heading “Actual” provides information about actual account values and actual expenses. You may use the information in these columns, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = $8.60), then multiply the result by the number in the appropriate column for your share class, in the column entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The information in the table under the heading “Hypothetical (5% return before expenses)” provides information about hypothetical account values and hypothetical expenses based on a Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in a Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) on purchase payments and exchange fees. Therefore, the information under the heading “Hypothetical (5% return before expenses)” is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Expense ratios may vary from period to period because of various factors such as an increase in expenses that are not covered by the management fees, such as fees and expenses of the independent trustees and their counsel, extraordinary expenses and interest expense.
Actual | Hypothetical (5% return before expenses) | |||||||||||||||||||||||||||||||||
Beginning Account Value (07/01/15) | Ending Account Value (12/31/15) | Expenses Paid During Period* | Beginning Account Value (07/01/15) | Ending Account Value (12/31/15) | Expenses Paid During Period* | Net Annualized Expense Ratio** | ||||||||||||||||||||||||||||
PIMCO RAE Fundamental Emerging Markets Fund | ||||||||||||||||||||||||||||||||||
Institutional Class | $ | 1,000.00 | $ | 771.50 | $ | 3.39 | $ | 1,000.00 | $ | 1,021.71 | $ | 3.87 | 0.75 | % | ||||||||||||||||||||
Class P | 1,000.00 | 770.20 | 3.84 | 1,000.00 | 1,021.20 | 4.39 | 0.85 | |||||||||||||||||||||||||||
Class A | 1,000.00 | 770.00 | 4.97 | 1,000.00 | 1,019.93 | 5.68 | 1.10 | |||||||||||||||||||||||||||
Class C | 1,000.00 | 767.00 | 8.35 | 1,000.00 | 1,016.09 | 9.53 | 1.85 | |||||||||||||||||||||||||||
PIMCO RAE Fundamental Global Fund | ||||||||||||||||||||||||||||||||||
Institutional Class | $ | 1,000.00 | $ | 916.20 | $ | 0.15 | $ | 1,000.00 | $ | 1,025.39 | $ | 0.16 | 0.03 | % | ||||||||||||||||||||
Class P | 1,000.00 | 916.60 | 0.64 | 1,000.00 | 1,024.88 | 0.67 | 0.13 | |||||||||||||||||||||||||||
Class A | 1,000.00 | 915.90 | 1.86 | 1,000.00 | 1,023.60 | 1.96 | 0.38 | |||||||||||||||||||||||||||
Class C | 1,000.00 | 913.20 | 5.52 | 1,000.00 | 1,019.77 | 5.83 | 1.13 | |||||||||||||||||||||||||||
PIMCO RAE Fundamental Global ex-US Fund | ||||||||||||||||||||||||||||||||||
Institutional Class | $ | 1,000.00 | $ | 870.20 | $ | 0.00 | $ | 1,000.00 | $ | 1,025.55 | $ | 0.00 | 0.00 | % | ||||||||||||||||||||
Class P | 1,000.00 | 869.80 | 0.48 | 1,000.00 | 1,025.04 | 0.52 | 0.10 | |||||||||||||||||||||||||||
Class A | 1,000.00 | 868.70 | 1.67 | 1,000.00 | 1,023.76 | 1.81 | 0.35 | |||||||||||||||||||||||||||
Class C | 1,000.00 | 865.70 | 5.24 | 1,000.00 | 1,019.93 | 5.68 | 1.10 |
20 | PIMCO EQUITY SERIES |
Table of Contents
Actual | Hypothetical (5% return before expenses) | |||||||||||||||||||||||||||||||||
Beginning Account Value (07/01/15) | Ending Account Value (12/31/15) | Expenses Paid During Period* | Beginning Account Value (07/01/15) | Ending Account Value (12/31/15) | Expenses Paid During Period* | Net Annualized Expense Ratio** | ||||||||||||||||||||||||||||
PIMCO RAE Fundamental International Fund | ||||||||||||||||||||||||||||||||||
Institutional Class | $ | 1,000.00 | $ | 903.40 | $ | 2.43 | $ | 1,000.00 | $ | 1,022.99 | $ | 2.58 | 0.50 | % | ||||||||||||||||||||
Class P | 1,000.00 | 903.50 | 2.92 | 1,000.00 | 1,022.48 | 3.10 | 0.60 | |||||||||||||||||||||||||||
Class A | 1,000.00 | 902.00 | 4.13 | 1,000.00 | 1,021.20 | 4.39 | 0.85 | |||||||||||||||||||||||||||
Class C | 1,000.00 | 897.70 | 7.76 | 1,000.00 | 1,017.37 | 8.25 | 1.60 | |||||||||||||||||||||||||||
PIMCO RAE Fundamental US Fund | ||||||||||||||||||||||||||||||||||
Institutional Class | $ | 1,000.00 | $ | 972.80 | $ | 2.02 | $ | 1,000.00 | $ | 1,023.50 | $ | 2.07 | 0.40 | % | ||||||||||||||||||||
Class P | 1,000.00 | 972.10 | 2.52 | 1,000.00 | 1,022.99 | 2.58 | 0.50 | |||||||||||||||||||||||||||
Class A | 1,000.00 | 970.10 | 4.03 | 1,000.00 | 1,021.46 | 4.13 | 0.80 | |||||||||||||||||||||||||||
Class C | 1,000.00 | 965.40 | 7.78 | 1,000.00 | 1,017.63 | 7.99 | 1.55 | |||||||||||||||||||||||||||
PIMCO RAE Fundamental US Small Fund | ||||||||||||||||||||||||||||||||||
Institutional Class | $ | 1,000.00 | $ | 908.10 | $ | 2.44 | $ | 1,000.00 | $ | 1,022.99 | $ | 2.58 | 0.50 | % | ||||||||||||||||||||
Class P | 1,000.00 | 908.00 | 2.92 | 1,000.00 | 1,022.48 | 3.10 | 0.60 | |||||||||||||||||||||||||||
Class A | 1,000.00 | 906.00 | 4.38 | 1,000.00 | 1,020.95 | 4.65 | 0.90 | |||||||||||||||||||||||||||
Class C | 1,000.00 | 904.10 | 8.03 | 1,000.00 | 1,017.12 | 8.50 | 1.65 |
* Expenses Paid During Period are equal to the net annualized expense ratio for the class, multiplied by the average account value over the period, multiplied by 187/366 (to reflect the one-half year period).
** Net Annualized Expense Ratio is reflective of any applicable contractual fee waivers and/or expense reimbursements or voluntary fee waivers. Details regarding fee waivers can be found in Note 7 in the Notes to Financial Statements.
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 21 |
Table of Contents
Selected Per Share Data for the Year or Period Ended: | Net Asset Value Beginning of Year or Period | Net Investment Income (Loss) (a) | Net Realized/ Unrealized (Loss) | Total from Investment Operations | Dividends from Net Investment Income (b) | Distributions from Net Realized Capital Gains (b) | Total Distributions | |||||||||||||||||||||
PIMCO RAE Fundamental Emerging Markets Fund | ||||||||||||||||||||||||||||
Institutional Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 9.95 | $ | 0.11 | $ | (2.38 | ) | $ | (2.27 | ) | $ | (0.17 | ) | $ | 0.00 | $ | (0.17 | ) | ||||||||||
06/05/2015 - 06/30/2015 | 10.00 | 0.06 | (0.11 | ) | (0.05 | ) | 0.00 | 0.00 | 0.00 | |||||||||||||||||||
Class P | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.96 | 0.11 | (2.40 | ) | (2.29 | ) | (0.18 | ) | 0.00 | (0.18 | ) | |||||||||||||||||
06/05/2015 - 06/30/2015 | 10.00 | 0.06 | (0.10 | ) | (0.04 | ) | 0.00 | 0.00 | 0.00 | |||||||||||||||||||
Class A | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.96 | 0.09 | (2.38 | ) | (2.29 | ) | (0.15 | ) | 0.00 | (0.15 | ) | |||||||||||||||||
06/05/2015 - 06/30/2015 | 10.00 | 0.08 | (0.12 | ) | (0.04 | ) | 0.00 | 0.00 | 0.00 | |||||||||||||||||||
Class C | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.95 | 0.04 | (2.36 | ) | (2.32 | ) | (0.13 | ) | 0.00 | (0.13 | ) | |||||||||||||||||
06/05/2015 - 06/30/2015 | 10.00 | 0.06 | (0.11 | ) | (0.05 | ) | 0.00 | 0.00 | 0.00 | |||||||||||||||||||
PIMCO RAE Fundamental Global Fund | ||||||||||||||||||||||||||||
Institutional Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 9.86 | $ | 0.34 | $ | (1.17 | ) | $ | (0.83 | ) | $ | (0.10 | ) | $ | 0.00 | $ | (0.10 | ) | ||||||||||
06/05/2015 - 06/30/2015 | 10.00 | (0.00 | )^ | (0.14 | ) | (0.14 | ) | 0.00 | 0.00 | 0.00 | ||||||||||||||||||
Class P | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.85 | 0.10 | (0.92 | ) | (0.82 | ) | (0.10 | ) | 0.00 | (0.10 | ) | |||||||||||||||||
06/05/2015 - 06/30/2015 | 10.00 | (0.00 | )^ | (0.15 | ) | (0.15 | ) | 0.00 | 0.00 | 0.00 | ||||||||||||||||||
Class A | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.85 | 0.20 | (1.03 | ) | (0.83 | ) | (0.10 | ) | 0.00 | (0.10 | ) | |||||||||||||||||
06/05/2015 - 06/30/2015 | 10.00 | (0.00 | )^ | (0.15 | ) | (0.15 | ) | 0.00 | 0.00 | 0.00 | ||||||||||||||||||
Class C | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.84 | 0.37 | (1.22 | ) | (0.85 | ) | (0.10 | ) | 0.00 | (0.10 | ) | |||||||||||||||||
06/05/2015 - 06/30/2015 | 10.00 | (0.01 | ) | (0.15 | ) | (0.16 | ) | 0.00 | 0.00 | 0.00 | ||||||||||||||||||
PIMCO RAE Fundamental Global ex-US Fund | ||||||||||||||||||||||||||||
Institutional Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 9.86 | $ | 0.10 | $ | (1.38 | ) | $ | (1.28 | ) | $ | (0.10 | ) | $ | 0.00 | $ | (0.10 | ) | ||||||||||
06/05/2015 - 06/30/2015 | 10.00 | (0.00 | )^ | (0.14 | ) | (0.14 | ) | 0.00 | 0.00 | 0.00 | ||||||||||||||||||
Class P | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.86 | 0.09 | (1.37 | ) | (1.28 | ) | (0.10 | ) | 0.00 | (0.10 | ) | |||||||||||||||||
06/05/2015 - 06/30/2015 | 10.00 | (0.00 | )^ | (0.14 | ) | (0.14 | ) | 0.00 | 0.00 | 0.00 | ||||||||||||||||||
Class A | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.86 | 0.08 | (1.37 | ) | (1.29 | ) | (0.09 | ) | 0.00 | (0.09 | ) | |||||||||||||||||
06/05/2015 - 06/30/2015 | 10.00 | (0.00 | )^ | (0.14 | ) | (0.14 | ) | 0.00 | 0.00 | 0.00 | ||||||||||||||||||
Class C | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.85 | 0.08 | (1.40 | ) | (1.32 | ) | (0.07 | ) | 0.00 | (0.07 | ) | |||||||||||||||||
06/05/2015 - 06/30/2015 | 10.00 | (0.01 | ) | (0.14 | ) | (0.15 | ) | 0.00 | 0.00 | 0.00 | ||||||||||||||||||
PIMCO RAE Fundamental International Fund | ||||||||||||||||||||||||||||
Institutional Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 9.83 | $ | 0.09 | $ | (1.04 | ) | $ | (0.95 | ) | $ | (0.08 | ) | $ | (0.15 | ) | $ | (0.23 | ) | |||||||||
06/05/2015 - 06/30/2015 | 10.00 | 0.02 | (0.19 | ) | (0.17 | ) | 0.00 | 0.00 | 0.00 | |||||||||||||||||||
Class P | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.83 | 0.07 | (1.02 | ) | (0.95 | ) | (0.08 | ) | (0.15 | ) | (0.23 | ) | ||||||||||||||||
06/05/2015 - 06/30/2015 | 10.00 | 0.02 | (0.19 | ) | (0.17 | ) | 0.00 | 0.00 | 0.00 | |||||||||||||||||||
Class A | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.83 | 0.08 | (1.05 | ) | (0.97 | ) | (0.05 | ) | (0.15 | ) | (0.20 | ) | ||||||||||||||||
06/05/2015 - 06/30/2015 | 10.00 | 0.01 | (0.18 | ) | (0.17 | ) | 0.00 | 0.00 | 0.00 | |||||||||||||||||||
Class C | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.83 | 0.02 | (1.03 | ) | (1.01 | ) | (0.08 | ) | (0.15 | ) | (0.23 | ) | ||||||||||||||||
06/05/2015 - 06/30/2015 | 10.00 | 0.01 | (0.18 | ) | (0.17 | ) | 0.00 | 0.00 | 0.00 | |||||||||||||||||||
PIMCO RAE Fundamental US Fund | ||||||||||||||||||||||||||||
Institutional Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 9.85 | $ | 0.11 | $ | (0.37 | ) | $ | (0.26 | ) | $ | (0.11 | ) | $ | (0.22 | ) | $ | (0.33 | ) | |||||||||
06/05/2015 - 06/30/2015 | 10.00 | 0.01 | (0.16 | ) | (0.15 | ) | 0.00 | 0.00 | 0.00 |
Please see footnotes on page 24.
22 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
Net Asset Value End of Year or Period | Total Return | Net Assets End of Year or Period (000s) | Ratio of Expenses to Average Net Assets | Ratio of Expenses to Average Net Assets Excluding Waivers | Ratio of Expenses to Average Net Assets Excluding Interest Expense | Ratio of Expenses to Average Net Assets Excluding Interest Expense and Waivers | Ratio of Net Investment Income (Loss) to Average Net Assets | Portfolio Turnover Rate | ||||||||||||||||||||||||||
$ | 7.51 | (22.85 | )% | $ | 173,690 | 0.75 | %* | 0.96 | %* | 0.75 | %* | 0.96 | %* | 2.62 | %* | 21 | % | |||||||||||||||||
9.95 | (0.50 | ) | 199,378 | 0.75 | * | 0.98 | * | 0.75 | * | 0.98 | * | 10.11 | * | 7 | ||||||||||||||||||||
7.49 | (22.98 | ) | 2,476 | 0.85 | * | 1.06 | * | 0.85 | * | 1.06 | * | 2.77 | * | 21 | ||||||||||||||||||||
9.96 | (0.40 | ) | 10 | 0.85 | * | 1.08 | * | 0.85 | * | 1.08 | * | 10.09 | * | 7 | ||||||||||||||||||||
7.52 | (23.00 | ) | 57 | 1.10 | * | 1.31 | * | 1.10 | * | 1.31 | * | 2.16 | * | 21 | ||||||||||||||||||||
9.96 | (0.40 | ) | 19 | 1.10 | * | 1.33 | * | 1.10 | * | 1.33 | * | 13.46 | * | 7 | ||||||||||||||||||||
7.50 | (23.30 | ) | 26 | 1.85 | * | 2.06 | * | 1.85 | * | 2.06 | * | 0.93 | * | 21 | ||||||||||||||||||||
9.95 | (0.50 | ) | 10 | 1.85 | * | 2.08 | * | 1.85 | * | 2.08 | * | 9.08 | * | 7 | ||||||||||||||||||||
$ | 8.93 | (8.38 | )% | $ | 204,219 | 0.03 | %* | 0.70 | %* | 0.03 | %* | 0.70 | %* | 7.24 | %* | 6 | % | |||||||||||||||||
9.86 | (1.40 | ) | 38,160 | 0.04 | * | 0.86 | * | 0.04 | * | 0.86 | * | (0.04 | )* | 2 | ||||||||||||||||||||
8.93 | (8.34 | ) | 11 | 0.13 | * | 0.80 | * | 0.13 | * | 0.80 | * | 2.11 | * | 6 | ||||||||||||||||||||
9.85 | (1.50 | ) | 10 | 0.14 | * | 0.96 | * | 0.14 | * | 0.96 | * | (0.14 | )* | 2 | ||||||||||||||||||||
8.92 | (8.41 | ) | 153 | 0.38 | * | 1.05 | * | 0.38 | * | 1.05 | * | 4.14 | * | 6 | ||||||||||||||||||||
9.85 | (1.50 | ) | 10 | 0.39 | * | 1.21 | * | 0.39 | * | 1.21 | * | (0.40 | )* | 2 | ||||||||||||||||||||
8.89 | (8.68 | ) | 282 | 1.13 | * | 1.80 | * | 1.13 | * | 1.80 | * | 7.97 | * | 6 | ||||||||||||||||||||
9.84 | (1.60 | ) | 17 | 1.14 | * | 1.96 | * | 1.14 | * | 1.96 | * | (1.06 | )* | 2 | ||||||||||||||||||||
$ | 8.48 | (12.98 | )% | $ | 61,251 | 0.00 | %* | 0.76 | %* | 0.00 | %* | 0.76 | %* | 2.09 | %* | 4 | % | |||||||||||||||||
9.86 | (1.40 | ) | 70,077 | 0.01 | * | 0.84 | * | 0.01 | * | 0.84 | * | (0.02 | )* | 2 | ||||||||||||||||||||
8.48 | (13.02 | ) | 9 | 0.10 | * | 0.86 | * | 0.10 | * | 0.86 | * | 2.00 | * | 4 | ||||||||||||||||||||
9.86 | (1.40 | ) | 10 | 0.11 | * | 0.94 | * | 0.11 | * | 0.94 | * | (0.11 | )* | 2 | ||||||||||||||||||||
8.48 | (13.13 | ) | 9 | 0.35 | * | 1.11 | * | 0.35 | * | 1.11 | * | 1.74 | * | 4 | ||||||||||||||||||||
9.86 | (1.40 | ) | 10 | 0.36 | * | 1.19 | * | 0.36 | * | 1.19 | * | (0.37 | )* | 2 | ||||||||||||||||||||
8.46 | (13.43 | ) | 13 | 1.10 | * | 1.86 | * | 1.10 | * | 1.86 | * | 1.80 | * | 4 | ||||||||||||||||||||
9.85 | (1.50 | ) | 10 | 1.11 | * | 1.94 | * | 1.11 | * | 1.94 | * | (1.12 | )* | 2 | ||||||||||||||||||||
$ | 8.65 | (9.66 | )% | $ | 200,658 | 0.50 | %* | 0.61 | %* | 0.50 | %* | 0.61 | %* | 1.88 | %* | 13 | % | |||||||||||||||||
9.83 | (1.70 | ) | 151,532 | 0.50 | * | 0.64 | * | �� | 0.50 | * | 0.64 | * | 2.68 | * | 7 | |||||||||||||||||||
8.65 | (9.65 | ) | 989 | 0.60 | * | 0.71 | * | 0.60 | * | 0.71 | * | 1.61 | * | 13 | ||||||||||||||||||||
9.83 | (1.70 | ) | 10 | 0.60 | * | 0.74 | * | 0.60 | * | 0.74 | * | 2.57 | * | 7 | ||||||||||||||||||||
8.66 | (9.80 | ) | 9 | 0.85 | * | 0.96 | * | 0.85 | * | 0.96 | * | 1.64 | * | 13 | ||||||||||||||||||||
9.83 | (1.70 | ) | 10 | 0.85 | * | 0.99 | * | 0.85 | * | 0.99 | * | 2.32 | * | 7 | ||||||||||||||||||||
8.59 | (10.23 | ) | 168 | 1.60 | * | 1.71 | * | 1.60 | * | 1.71 | * | 0.33 | * | 13 | ||||||||||||||||||||
9.83 | (1.70 | ) | 10 | 1.60 | * | 1.74 | * | 1.60 | * | 1.74 | * | 1.56 | * | 7 | ||||||||||||||||||||
$ | 9.26 | (2.72 | )% | $ | 484,174 | 0.40 | %* | 0.51 | %* | 0.40 | %* | 0.51 | %* | 2.16 | %* | 29 | % | |||||||||||||||||
9.85 | (1.50 | ) | 447,755 | 0.40 | * | 0.51 | * | 0.40 | * | 0.51 | * | 2.03 | * | 5 |
Please see footnotes on page 24.
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 23 |
Table of Contents
Financial Highlights (Cont.)
Selected Per Share Data for the Year or Period Ended: | Net Asset Value Beginning of Year or Period | Net Investment Income (Loss) (a) | Net Realized/ Unrealized (Loss) | Total from Investment Operations | Dividends from Net Investment Income (b) | Distributions from Net Realized Capital Gains (b) | Total Distributions | |||||||||||||||||||||
PIMCO RAE Fundamental US Fund (Cont.) | ||||||||||||||||||||||||||||
Class P | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 9.85 | $ | 0.10 | $ | (0.37 | ) | $ | (0.27 | ) | $ | (0.11 | ) | $ | (0.22 | ) | $ | (0.33 | ) | |||||||||
06/05/2015 - 06/30/2015 | 10.00 | 0.01 | (0.16 | ) | (0.15 | ) | 0.00 | 0.00 | 0.00 | |||||||||||||||||||
Class A | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.86 | 0.09 | (0.38 | ) | (0.29 | ) | (0.10 | ) | (0.22 | ) | (0.32 | ) | ||||||||||||||||
06/05/2015 - 06/30/2015 | 10.00 | 0.01 | (0.15 | ) | (0.14 | ) | 0.00 | 0.00 | 0.00 | |||||||||||||||||||
Class C | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.85 | 0.05 | (0.39 | ) | (0.34 | ) | (0.09 | ) | (0.22 | ) | (0.31 | ) | ||||||||||||||||
06/05/2015 - 06/30/2015 | 10.00 | 0.01 | (0.16 | ) | (0.15 | ) | 0.00 | 0.00 | 0.00 | |||||||||||||||||||
PIMCO RAE Fundamental US Small Fund | ||||||||||||||||||||||||||||
Institutional Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 9.93 | $ | 0.05 | $ | (0.96 | ) | $ | (0.91 | ) | $ | (0.04 | ) | $ | (0.11 | ) | $ | (0.15 | ) | |||||||||
06/05/2015 - 06/30/2015 | 10.00 | 0.01 | (0.08 | ) | (0.07 | ) | 0.00 | 0.00 | 0.00 | |||||||||||||||||||
Class P | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.92 | 0.04 | (0.95 | ) | (0.91 | ) | (0.04 | ) | (0.11 | ) | (0.15 | ) | ||||||||||||||||
06/05/2015 - 06/30/2015 | 10.00 | 0.01 | (0.09 | ) | (0.08 | ) | 0.00 | 0.00 | 0.00 | |||||||||||||||||||
Class A | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.92 | 0.03 | (0.97 | ) | (0.94 | ) | (0.00 | )^ | (0.11 | ) | (0.11 | ) | ||||||||||||||||
06/05/2015 - 06/30/2015 | 10.00 | 0.01 | (0.09 | ) | (0.08 | ) | 0.00 | 0.00 | 0.00 | |||||||||||||||||||
Class C | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.91 | 0.00 | ^ | (0.95 | ) | (0.95 | ) | (0.04 | ) | (0.11 | ) | (0.15 | ) | |||||||||||||||
06/05/2015 - 06/30/2015 | 10.00 | 0.00 | ^ | (0.09 | ) | (0.09 | ) | 0.00 | 0.00 | 0.00 |
+ | Unaudited |
* | Annualized |
^ | Reflects an amount rounding to less than one cent. |
(a) | Per share amounts based on average number of shares outstanding during the year or period. |
(b) | Determined in accordance with federal income tax regulations, see Note 2(d) in the Notes to Financial Statements for more information. |
24 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
Net Asset Value End of Year or Period | Total Return | Net Assets End of Year or Period (000s) | Ratio of Expenses to Average Net Assets | Ratio of Expenses to Average Net Assets Excluding Waivers | Ratio of Expenses to Average Net Assets Excluding Interest Expense | Ratio of Expenses to Average Net Assets Excluding Interest Expense and Waivers | Ratio of Net Investment Income (Loss) to Average Net Assets | Portfolio Turnover Rate | ||||||||||||||||||||||||||
$ | 9.25 | (2.79 | )% | $ | 1,818 | 0.50 | %* | 0.61 | %* | 0.50 | %* | 0.61 | %* | 2.12 | %* | 29 | % | |||||||||||||||||
9.85 | (1.50 | ) | 10 | 0.50 | * | 0.61 | * | 0.50 | * | 0.61 | * | 1.92 | * | 5 | ||||||||||||||||||||
9.25 | (2.99 | ) | 1,593 | 0.80 | * | 0.91 | * | 0.80 | * | 0.91 | * | 1.81 | * | 29 | ||||||||||||||||||||
9.86 | (1.40 | ) | 14 | 0.80 | * | 0.91 | * | 0.80 | * | 0.91 | * | 1.67 | * | 5 | ||||||||||||||||||||
9.20 | (3.46 | ) | 399 | 1.55 | * | 1.66 | * | 1.55 | * | 1.66 | * | 1.01 | * | 29 | ||||||||||||||||||||
9.85 | (1.50 | ) | 10 | 1.55 | * | 1.66 | * | 1.55 | * | 1.66 | * | 0.86 | * | 5 | ||||||||||||||||||||
$ | 8.87 | (9.19 | )% | $ | 105,932 | 0.50 | %* | 0.61 | %* | 0.50 | %* | 0.61 | %* | 1.01 | %* | 53 | % | |||||||||||||||||
9.93 | (0.70 | ) | 46,426 | 0.50 | * | 0.73 | * | 0.50 | * | 0.73 | * | 1.44 | * | 9 | ||||||||||||||||||||
�� | ||||||||||||||||||||||||||||||||||
8.86 | (9.20 | ) | 171 | 0.60 | * | 0.71 | * | 0.60 | * | 0.71 | * | 0.91 | * | 53 | ||||||||||||||||||||
9.92 | (0.80 | ) | 10 | 0.60 | * | 0.83 | * | 0.60 | * | 0.83 | * | 1.33 | * | 9 | ||||||||||||||||||||
8.87 | (9.40 | ) | 101 | 0.90 | * | 1.01 | * | 0.90 | * | 1.01 | * | 0.71 | * | 53 | ||||||||||||||||||||
9.92 | (0.80 | ) | 10 | 0.90 | * | 1.13 | * | 0.90 | * | 1.13 | * | 1.04 | * | 9 | ||||||||||||||||||||
8.81 | (9.59 | ) | 144 | 1.65 | * | 1.76 | * | 1.65 | * | 1.76 | * | 0.04 | * | 53 | ||||||||||||||||||||
9.91 | (0.90 | ) | 10 | 1.65 | * | 1.88 | * | 1.65 | * | 1.88 | * | 0.28 | * | 9 |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 25 |
Table of Contents
Statements of Assets and Liabilities
(Amounts in thousands†, except per share amounts) | PIMCO RAE Fundamental Emerging Markets Fund | PIMCO RAE Fundamental Global Fund | PIMCO RAE Fundamental Global ex-US Fund | PIMCO RAE Fundamental International Fund | PIMCO RAE Fundamental US Fund | PIMCO RAE Fundamental US Small Fund | ||||||||||||||||||
Assets: | ||||||||||||||||||||||||
Investments, at value | ||||||||||||||||||||||||
Investments in securities | $ | 186,346 | $ | 0 | $ | 0 | $ | 201,798 | $ | 486,107 | $ | 105,911 | ||||||||||||
Investments in Affiliates | 0 | 204,548 | 61,248 | 0 | 0 | 0 | ||||||||||||||||||
Cash | 3,216 | 0 | 35 | 803 | 1,852 | 882 | ||||||||||||||||||
Foreign currency, at value | 221 | 0 | 0 | 173 | 0 | 0 | ||||||||||||||||||
Receivable for investments sold | 590 | 0 | 0 | 138 | 520 | 2 | ||||||||||||||||||
Receivable for investments in Affiliates sold | 0 | 2,165 | 0 | 0 | 0 | 0 | ||||||||||||||||||
Receivable for Fund shares sold | 18 | 1 | 0 | 0 | 47 | 0 | ||||||||||||||||||
Interest and dividends receivable | 411 | 0 | 0 | 286 | 702 | 129 | ||||||||||||||||||
Reimbursement receivable from PIMCO | 3 | 0 | 2 | 2 | 7 | 0 | ||||||||||||||||||
Other assets | 551 | 0 | 0 | 13 | 0 | 0 | ||||||||||||||||||
Total Assets | 191,356 | 206,714 | 61,285 | 203,213 | 489,235 | 106,924 | ||||||||||||||||||
Liabilities: | ||||||||||||||||||||||||
Financial Derivative Instruments | ||||||||||||||||||||||||
Over the counter | $ | 32 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | ||||||||||||
Payable for investments purchased | 3,398 | 0 | 0 | 0 | 0 | 517 | ||||||||||||||||||
Deposits from counterparty | 160 | 0 | 0 | 280 | 0 | 0 | ||||||||||||||||||
Payable for Fund shares redeemed | 11,339 | 0 | 0 | 988 | 1,053 | 0 | ||||||||||||||||||
Overdraft due to custodian | 0 | 2,042 | 0 | 0 | 0 | 0 | ||||||||||||||||||
Accrued investment advisory fees | 49 | 0 | 0 | 35 | 67 | 25 | ||||||||||||||||||
Accrued supervisory and administrative fees | 74 | 5 | 0 | 53 | 112 | 25 | ||||||||||||||||||
Accrued servicing fees | 0 | 0 | 0 | 0 | 0 | 6 | ||||||||||||||||||
Other liabilities | 55 | 2 | 3 | 33 | 19 | 3 | ||||||||||||||||||
Total Liabilities | 15,107 | 2,049 | 3 | 1,389 | 1,251 | 576 | ||||||||||||||||||
Net Assets | $ | 176,249 | $ | 204,665 | $ | 61,282 | $ | 201,824 | $ | 487,984 | $ | 106,348 | ||||||||||||
Net Assets Consist of: | ||||||||||||||||||||||||
Paid in capital | $ | 235,085 | $ | 214,785 | $ | 72,089 | $ | 199,274 | $ | 409,997 | $ | 105,094 | ||||||||||||
(Overdistributed) net investment income | (449 | ) | (85 | ) | (30 | ) | (273 | ) | (1 | ) | (57 | ) | ||||||||||||
Accumulated undistributed net realized gain (loss) | (13,453 | ) | 3,391 | 336 | (2,318 | ) | 9,860 | (3,807 | ) | |||||||||||||||
Net unrealized appreciation (depreciation) | (44,934 | ) | (13,426 | ) | (11,113 | ) | 5,141 | 68,128 | 5,118 | |||||||||||||||
$ | 176,249 | $ | 204,665 | $ | 61,282 | $ | 201,824 | $ | 487,984 | $ | 106,348 | |||||||||||||
Cost of investments in securities | $ | 231,275 | $ | 0 | $ | 0 | $ | 196,654 | $ | 417,979 | $ | 100,793 | ||||||||||||
Cost of investments in Affiliates | $ | 0 | $ | 217,974 | $ | 72,361 | $ | 0 | $ | 0 | $ | 0 | ||||||||||||
Cost of foreign currency held | $ | 222 | $ | 0 | $ | 0 | $ | 173 | $ | 0 | $ | 0 |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
26 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
PIMCO RAE Fundamental Emerging Markets Fund | PIMCO RAE Fundamental Global Fund | PIMCO RAE Fundamental Global ex-US Fund | PIMCO RAE Fundamental International Fund | PIMCO RAE Fundamental US Fund | PIMCO RAE Fundamental US Small Fund | |||||||||||||||||||
Net Assets: | ||||||||||||||||||||||||
Institutional Class | $ | 173,690 | $ | 204,219 | $ | 61,251 | $ | 200,658 | $ | 484,174 | $ | 105,932 | ||||||||||||
Class P | 2,476 | 11 | 9 | 989 | 1,818 | 171 | ||||||||||||||||||
Class A | 57 | 153 | 9 | 9 | 1,593 | 101 | ||||||||||||||||||
Class C | 26 | 282 | 13 | 168 | 399 | 144 | ||||||||||||||||||
Shares Issued and Outstanding: | ||||||||||||||||||||||||
Institutional Class | 23,127 | 22,857 | 7,223 | 23,199 | 52,309 | 11,949 | ||||||||||||||||||
Class P | 331 | 1 | 1 | 114 | 197 | 19 | ||||||||||||||||||
Class A | 8 | 17 | 1 | 1 | 172 | 11 | ||||||||||||||||||
Class C | 3 | 32 | 2 | 20 | 43 | 16 | ||||||||||||||||||
Net Asset Value and Redemption Price^ Per Share Outstanding: | ||||||||||||||||||||||||
Institutional Class | $ | 7.51 | $ | 8.93 | $ | 8.48 | $ | 8.65 | $ | 9.26 | $ | 8.87 | ||||||||||||
Class P | 7.49 | 8.93 | 8.48 | 8.65 | 9.25 | 8.86 | ||||||||||||||||||
Class A | 7.52 | 8.92 | 8.48 | 8.66 | 9.25 | 8.87 | ||||||||||||||||||
Class C | 7.50 | 8.89 | 8.46 | 8.59 | 9.20 | 8.81 |
^ | With respect to Class A and Class C, the redemption price varies by the length of time the shares are held. |
SEMIANNUAL REPORT | DECEMBER��31, 2015 | 27 |
Table of Contents
(Unaudited)
Six Months Ended December 31, 2015 | ||||||||||||||||||||||||
(Amounts in thousands†) | PIMCO RAE Fundamental Emerging Markets Fund | PIMCO RAE Fundamental Global Fund | PIMCO RAE Fundamental Global ex-US Fund | PIMCO RAE Fundamental International Fund | PIMCO RAE Fundamental US Fund | PIMCO RAE Fundamental US Small Fund | ||||||||||||||||||
Investment Income: | ||||||||||||||||||||||||
Interest | $ | 0 | $ | 0 | $ | 0 | $ | 16 | $ | 0 | $ | 0 | ||||||||||||
Dividends, net of foreign taxes* | 3,054 | 0 | 0 | 1,861 | 5,842 | 677 | ||||||||||||||||||
Dividends from Investments in Affiliates | 0 | 2,327 | 692 | 0 | 0 | 0 | ||||||||||||||||||
Total Income | 3,054 | 2,327 | 692 | 1,877 | 5,842 | 677 | ||||||||||||||||||
Expenses: | ||||||||||||||||||||||||
Investment advisory fees | 453 | 127 | 132 | 237 | 570 | 156 | ||||||||||||||||||
Supervisory and administrative fees | 408 | 95 | 116 | 238 | 571 | 111 | ||||||||||||||||||
Distribution fees - Class C | 0 | 0 | 0 | 0 | 1 | 0 | ||||||||||||||||||
Servicing fees - Class A | 0 | 0 | 0 | 0 | 1 | 0 | ||||||||||||||||||
Trustee fees | 8 | 2 | 3 | 6 | 19 | 3 | ||||||||||||||||||
Interest expense | 3 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||
Miscellaneous expense | 4 | 2 | 2 | 4 | 11 | 2 | ||||||||||||||||||
Total Expenses | 876 | 226 | 253 | 485 | 1,173 | 272 | ||||||||||||||||||
Waiver and/or Reimbursement by PIMCO | (189 | ) | (215 | ) | (252 | ) | (85 | ) | (247 | ) | (47 | ) | ||||||||||||
Net Expenses | 687 | 11 | 1 | 400 | 926 | 225 | ||||||||||||||||||
Net Investment Income | 2,367 | 2,316 | 691 | 1,477 | 4,916 | 452 | ||||||||||||||||||
Net Realized Gain (Loss): | ||||||||||||||||||||||||
Investments in securities | (10,070 | ) | 0 | 0 | (248 | ) | 18,590 | (3,268 | ) | |||||||||||||||
Investments in Affiliates | 0 | (482 | ) | (496 | ) | 0 | 0 | 0 | ||||||||||||||||
Net capital gain distributions received from Affiliate investments | 0 | 3,885 | 854 | 0 | 0 | 0 | ||||||||||||||||||
Over the counter financial derivative instruments | (5 | ) | 0 | 0 | 4 | 0 | 0 | |||||||||||||||||
Foreign currency | (30 | ) | 0 | 0 | (62 | ) | 0 | 0 | ||||||||||||||||
Net Realized Gain (Loss) | (10,105 | ) | 3,403 | 358 | (306 | ) | 18,590 | (3,268 | ) | |||||||||||||||
Net Change in Unrealized Appreciation (Depreciation): | ||||||||||||||||||||||||
Investments in securities | (39,649 | ) | 0 | 0 | (17,725 | ) | (38,373 | ) | (2,393 | ) | ||||||||||||||
Investments in Affiliates | 0 | (12,882 | ) | (10,156 | ) | 0 | 0 | 0 | ||||||||||||||||
Over the counter financial derivative instruments | (32 | ) | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||
Foreign currency assets and liabilities | 27 | 0 | 0 | (3 | ) | 0 | 0 | |||||||||||||||||
Net Change in Unrealized (Depreciation) | (39,654 | ) | (12,882 | ) | (10,156 | ) | (17,728 | ) | (38,373 | ) | (2,393 | ) | ||||||||||||
Net (Decrease) in Net Assets Resulting from Operations | $ | (47,392 | ) | $ | (7,163 | ) | $ | (9,107 | ) | $ | (16,557 | ) | $ | (14,867 | ) | $ | (5,209 | ) | ||||||
* Foreign tax withholdings - Dividends | $ | 370 | $ | 0 | $ | 0 | $ | 140 | $ | 0 | $ | 0 |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
28 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
Statements of Changes in Net Assets
PIMCO RAE Fundamental Emerging Markets Fund | PIMCO RAE Fundamental Global Fund | PIMCO RAE Fundamental Global ex-US Fund | ||||||||||||||||||||||
(Amounts in thousands†) | Six Months Ended | Inception date through June 30, 2015 | Six Months Ended December 31, 2015 (Unaudited) | Inception date through June 30, 2015 | Six Months Ended December 31, 2015 (Unaudited) | Inception date through June 30, 2015 | ||||||||||||||||||
Increase (Decrease) in Net Assets from: | ||||||||||||||||||||||||
Operations: | ||||||||||||||||||||||||
Net investment income (loss) | $ | 2,367 | $ | 1,265 | $ | 2,316 | $ | (1 | ) | $ | 691 | $ | (1 | ) | ||||||||||
Net realized gain (loss) | (10,105 | ) | (1,514 | ) | 3,403 | (12 | ) | 358 | (22 | ) | ||||||||||||||
Net change in unrealized (depreciation) | (39,654 | ) | (1,205 | ) | (12,882 | ) | (544 | ) | (10,156 | ) | (957 | ) | ||||||||||||
Net (Decrease) in Net Assets Resulting from Operations | (47,392 | ) | (1,454 | ) | (7,163 | ) | (557 | ) | (9,107 | ) | (980 | ) | ||||||||||||
Distributions to Shareholders: | ||||||||||||||||||||||||
From net investment income (a) | ||||||||||||||||||||||||
Institutional Class | (3,853 | ) | 0 | (2,395 | ) | 0 | (720 | ) | 0 | |||||||||||||||
Class P | (61 | ) | 0 | (0 | ) | 0 | (0 | ) | 0 | |||||||||||||||
Class A | (1 | ) | 0 | (2 | ) | 0 | (0 | ) | 0 | |||||||||||||||
Class C | (0 | ) | 0 | (3 | ) | 0 | (0 | ) | 0 | |||||||||||||||
From net realized capital gains (a) | ||||||||||||||||||||||||
Institutional Class | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||
Class P | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||
Class A | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||
Class C | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||
Total Distributions | (3,915 | ) | 0 | (2,400 | ) | 0 | (720 | ) | 0 | |||||||||||||||
Portfolio Share Transactions: | ||||||||||||||||||||||||
Net increase resulting from Fund share transactions** | 28,139 | 200,871 | 176,031 | 38,754 | 1,002 | 71,087 | ||||||||||||||||||
Total Increase (Decrease) in Net Assets | (23,168 | ) | 199,417 | 166,468 | 38,197 | (8,825 | ) | 70,107 | ||||||||||||||||
Net Assets: | ||||||||||||||||||||||||
Beginning of period | 199,417 | 0 | 38,197 | 0 | 70,107 | 0 | ||||||||||||||||||
End of period* | $ | 176,249 | $ | 199,417 | $ | 204,665 | $ | 38,197 | $ | 61,282 | $ | 70,107 | ||||||||||||
* Including undistributed (overdistributed) net investment income of: | $ | (449 | ) | $ | 1,099 | $ | (85 | ) | $ | (1 | ) | $ | (30 | ) | $ | (1 | ) |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
** | See Note 11 in the Notes to Financial Statements. |
(a) | Determined in accordance with federal income tax regulations, see Note 2(d) in the Notes to Financial Statements for more information. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 29 |
Table of Contents
Statements of Changes in Net Assets (Cont.)
PIMCO RAE Fundamental International Fund | PIMCO RAE Fundamental US Fund | PIMCO RAE Fundamental US Small Fund | ||||||||||||||||||||||
(Amounts in thousands†) | Six Months Ended | Inception date through June 30, 2015 | Six Months Ended December 31, 2015 (Unaudited) | Inception date through June 30, 2015 | Six Months Ended December 31, 2015 (Unaudited) | Inception date through June 30, 2015 | ||||||||||||||||||
Increase in Net Assets from: | ||||||||||||||||||||||||
Operations: | ||||||||||||||||||||||||
Net investment income (loss) | $ | 1,477 | $ | 265 | $ | 4,916 | $ | 581 | $ | 452 | $ | 43 | ||||||||||||
Net realized gain (loss) | (306 | ) | 1,954 | 18,590 | 4,427 | (3,268 | ) | 918 | ||||||||||||||||
Net change in unrealized (depreciation) | (17,728 | ) | (4,949 | ) | (38,373 | ) | (11,647 | ) | (2,393 | ) | (1,306 | ) | ||||||||||||
Net (Decrease) in Net Assets Resulting from Operations | (16,557 | ) | (2,730 | ) | (14,867 | ) | (6,639 | ) | (5,209 | ) | (345 | ) | ||||||||||||
Distributions to Shareholders: | ||||||||||||||||||||||||
From net investment income (a) | ||||||||||||||||||||||||
Institutional Class | (1,748 | ) | 0 | (5,444 | ) | 0 | (518 | ) | 0 | |||||||||||||||
Class P | (9 | ) | 0 | (21 | ) | 0 | (1 | ) | 0 | |||||||||||||||
Class A | (0 | ) | 0 | (15 | ) | 0 | (0 | ) | 0 | |||||||||||||||
Class C | (2 | ) | 0 | (3 | ) | 0 | (1 | ) | 0 | |||||||||||||||
From net realized capital gains (a) | ||||||||||||||||||||||||
Institutional Class | (3,508 | ) | 0 | (11,342 | ) | 0 | (1,268 | ) | 0 | |||||||||||||||
Class P | (17 | ) | 0 | (43 | ) | 0 | (2 | ) | 0 | |||||||||||||||
Class A | (0 | ) | 0 | (32 | ) | 0 | (5 | ) | 0 | |||||||||||||||
Class C | (1 | ) | 0 | (6 | ) | 0 | (0 | ) | 0 | |||||||||||||||
Total Distributions | (5,285 | ) | 0 | (16,906 | ) | 0 | (1,795 | ) | 0 | |||||||||||||||
Portfolio Share Transactions: | ||||||||||||||||||||||||
Net increase resulting from Fund share transactions** | 72,104 | 154,292 | 71,968 | 454,428 | 66,896 | 46,801 | ||||||||||||||||||
Total Increase in Net Assets | 50,262 | 151,562 | 40,195 | 447,789 | 59,892 | 46,456 | ||||||||||||||||||
Net Assets: | ||||||||||||||||||||||||
Beginning of period | 151,562 | 0 | 447,789 | 0 | 46,456 | 0 | ||||||||||||||||||
End of period* | $ | 201,824 | $ | 151,562 | $ | 487,984 | $ | 447,789 | $ | 106,348 | $ | 46,456 | ||||||||||||
* Including undistributed (overdistributed) net investment income of: | $ | (273 | ) | $ | 9 | $ | (1 | ) | $ | 566 | $ | (57 | ) | $ | 11 |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
** | See Note 11 in the Notes to Financial Statements. |
(a) | Determined in accordance with federal income tax regulations, see Note 2(d) in the Notes to Financial Statements for more information. |
30 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
Schedule of Investments PIMCO RAE Fundamental Emerging Markets Fund
December 31, 2015 (Unaudited)
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN SECURITIES 105.7% | ||||||||||||
COMMON STOCKS 96.4% | ||||||||||||
BRAZIL 9.0% | ||||||||||||
CONSUMER DISCRETIONARY 0.0% | ||||||||||||
Lojas Renner S.A. | 12,500 | $ | 54 | |||||||||
|
| |||||||||||
CONSUMER STAPLES 0.8% | ||||||||||||
AMBEV S.A. ADR | 90,557 | 404 | ||||||||||
BRF S.A. | 5,300 | 74 | ||||||||||
JBS S.A. | 75,500 | 234 | ||||||||||
Marfrig Global Foods S.A. (a) | 131,900 | 211 | ||||||||||
Natura Cosmeticos S.A. | 91,400 | 541 | ||||||||||
|
| |||||||||||
1,464 | ||||||||||||
|
| |||||||||||
ENERGY 0.2% | ||||||||||||
Petroleo Brasileiro S.A. SP - ADR (a) | 71,494 | 307 | ||||||||||
Ultrapar Participacoes S.A. | 2,700 | 41 | ||||||||||
|
| |||||||||||
348 | ||||||||||||
|
| |||||||||||
FINANCIALS 3.7% | ||||||||||||
Banco Bradesco S.A. ADR | 205,417 | 988 | ||||||||||
Banco do Brasil S.A. | 424,000 | 1,570 | ||||||||||
BM&FBovespa S.A. - Bolsa de Valores Mercadorias e Futuros | 95,700 | 262 | ||||||||||
BR Malls Participacoes S.A. | 16,300 | 45 | ||||||||||
Itau Unibanco Holding S.A. SP - ADR | 486,148 | 3,165 | ||||||||||
Sul America S.A. | 91,459 | 429 | ||||||||||
|
| |||||||||||
6,459 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 0.2% | ||||||||||||
CCR S.A. | 59,300 | 187 | ||||||||||
Embraer S.A. SP - ADR | 1,663 | 49 | ||||||||||
Rumo Logistica Operadora Multimodal S.A. (a) | 19,070 | 30 | ||||||||||
|
| |||||||||||
266 | ||||||||||||
|
| |||||||||||
MATERIALS 0.9% | ||||||||||||
Cia Siderurgica Nacional S.A. SP - ADR | 839,523 | 819 | ||||||||||
Fibria Celulose S.A. SP - ADR | 16,289 | 207 | ||||||||||
Gerdau S.A. SP - ADR | 507,915 | 610 | ||||||||||
|
| |||||||||||
1,636 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 0.8% | ||||||||||||
Telefonica Brasil S.A. ADR | 112,285 | 1,014 | ||||||||||
Tim Participacoes S.A. ADR | 46,631 | 395 | ||||||||||
|
| |||||||||||
1,409 | ||||||||||||
|
| |||||||||||
UTILITIES 2.4% | ||||||||||||
Alupar Investimento S.A. | 4,600 | 15 | ||||||||||
Cia de Saneamento Basico do Estado de Sao Paulo ADR | 180,352 | 830 | ||||||||||
Cia de Saneamento de Minas Gerais-COPASA | 7,500 | 30 | ||||||||||
Cia Energetica de Minas Gerais SP - ADR | 812,654 | 1,219 |
SHARES | MARKET VALUE (000S) | |||||||||||
CPFL Energia S.A. ADR (a) | 95,276 | $ | 707 | |||||||||
EDP - Energias do Brasil S.A. | 213,300 | 647 | ||||||||||
Light S.A. | 93,100 | 232 | ||||||||||
Tractebel Energia S.A. | 57,400 | 484 | ||||||||||
Transmissora Alianca de Energia Eletrica S.A. | 26,500 | 112 | ||||||||||
|
| |||||||||||
4,276 | ||||||||||||
|
| |||||||||||
Total Brazil | 15,912 | |||||||||||
|
| |||||||||||
CHINA 22.1% | ||||||||||||
CONSUMER DISCRETIONARY 0.1% | ||||||||||||
Belle International Holdings Ltd. | 44,000 | 33 | ||||||||||
GOME Electrical Appliances Holding Ltd. | 1,013,000 | 168 | ||||||||||
Great Wall Motor Co. Ltd. ‘H’ | 32,000 | 37 | ||||||||||
|
| |||||||||||
238 | ||||||||||||
|
| |||||||||||
CONSUMER STAPLES 0.0% | ||||||||||||
Hengan International Group Co. Ltd. | 3,000 | 28 | ||||||||||
|
| |||||||||||
ENERGY 3.4% | ||||||||||||
China Petroleum & Chemical Corp. ‘H’ | 3,474,400 | 2,091 | ||||||||||
China Shenhua Energy Co. Ltd. ‘H’ | 490,000 | 767 | ||||||||||
CNOOC Ltd. | 2,036,000 | 2,119 | ||||||||||
Inner Mongolia Yitai Coal Co. Ltd. ‘B’ | 408,509 | 371 | ||||||||||
PetroChina Co. Ltd. ‘H’ | 788,000 | 517 | ||||||||||
Yanzhou Coal Mining Co. Ltd. ‘H’ | 130,000 | 60 | ||||||||||
|
| |||||||||||
5,925 | ||||||||||||
|
| |||||||||||
FINANCIALS 16.6% | ||||||||||||
Agile Property Holdings Ltd. | 1,008,000 | 560 | ||||||||||
Agricultural Bank of China Ltd. ‘H’ | 4,765,000 | 1,939 | ||||||||||
Bank of China Ltd. ‘H’ | 10,447,000 | 4,635 | ||||||||||
Bank of Communications Co. Ltd. ‘H’ | 1,523,000 | 1,068 | ||||||||||
China CITIC Bank Corp. Ltd. ‘H’ | 702,000 | 452 | ||||||||||
China Construction Bank Corp. ‘H’ | 10,046,000 | 6,853 | ||||||||||
China Everbright Bank Co. Ltd. ‘H’ | 567,000 | 275 | ||||||||||
China Life Insurance Co. Ltd. ‘H’ | 262,000 | 843 | ||||||||||
China Merchants Bank Co. Ltd. ‘H’ | 492,500 | 1,154 | ||||||||||
China Minsheng Banking Corp. Ltd. ‘H’ | 735,100 | 727 | ||||||||||
China Vanke Co. Ltd. ‘H’ | 13,000 | 39 | ||||||||||
Chongqing Rural Commercial Bank Co. Ltd. ‘H’ | 656,000 | 395 | ||||||||||
Country Garden Holdings Co. Ltd. | 565,000 | 230 | ||||||||||
Dalian Wanda Commercial Properties Co. Ltd. ‘H’ | 44,800 | 260 | ||||||||||
Evergrande Real Estate Group Ltd. | 1,547,000 | 1,354 | ||||||||||
Guangzhou R&F Properties Co. Ltd. ‘H’ | 722,800 | 886 |
SHARES | MARKET VALUE (000S) | |||||||||||
Industrial & Commercial Bank of China Ltd. ‘H’ | 9,387,000 | $ | 5,627 | |||||||||
New China Life Insurance Co. Ltd. ‘H’ | 45,200 | 189 | ||||||||||
People’s Insurance Co. Group of China Ltd. ‘H’ | 258,000 | 126 | ||||||||||
PICC Property & Casualty Co. Ltd. ‘H’ | 52,000 | 103 | ||||||||||
Ping An Insurance Group Co. of China Ltd. ‘H’ | 181,000 | 996 | ||||||||||
Sino-Ocean Land Holdings Ltd. | 278,500 | 178 | ||||||||||
SOHO China Ltd. | 959,000 | 464 | ||||||||||
|
| |||||||||||
29,353 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 0.2% | ||||||||||||
China Communications Construction Co. Ltd. ‘H’ | 240,000 | 243 | ||||||||||
Fosun International Ltd. | 24,500 | 38 | ||||||||||
|
| |||||||||||
281 | ||||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 0.1% | ||||||||||||
Lenovo Group Ltd. | 108,000 | 109 | ||||||||||
Semiconductor Manufacturing International Corp. (a) | 264,000 | 27 | ||||||||||
Sohu.com, Inc. (a) | 1,575 | 90 | ||||||||||
|
| |||||||||||
226 | ||||||||||||
|
| |||||||||||
MATERIALS 0.5% | ||||||||||||
Anhui Conch Cement Co. Ltd. ‘H’ | 21,500 | 57 | ||||||||||
China National Building Material Co. Ltd. ‘H’ | 1,586,000 | 757 | ||||||||||
Jiangxi Copper Co. Ltd. ‘H’ | 39,000 | 46 | ||||||||||
|
| |||||||||||
860 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 1.0% | ||||||||||||
China Telecom Corp. Ltd. ‘H’ | 3,848,000 | 1,795 | ||||||||||
|
| |||||||||||
UTILITIES 0.2% | ||||||||||||
Huaneng Power International, Inc. ‘H’ | 320,000 | 275 | ||||||||||
|
| |||||||||||
Total China | 38,981 | |||||||||||
|
| |||||||||||
GREECE 0.0% | ||||||||||||
TELECOMMUNICATION SERVICES 0.0% | ||||||||||||
Hellenic Telecommunications Organization S.A. | 3,469 | 35 | ||||||||||
|
| |||||||||||
Total Greece | 35 | |||||||||||
|
| |||||||||||
HONG KONG 5.9% | ||||||||||||
CONSUMER STAPLES 0.5% | ||||||||||||
China Resources Beer Holdings Company Ltd. | 402,000 | 859 | ||||||||||
|
| |||||||||||
ENERGY 0.0% | ||||||||||||
Kunlun Energy Co. Ltd. | 46,000 | 41 | ||||||||||
|
| |||||||||||
FINANCIALS 1.1% | ||||||||||||
BOC Hong Kong Holdings Ltd. | 148,000 | 449 | ||||||||||
China Overseas Land & Investment Ltd. | 72,000 | 250 |
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 31 |
Table of Contents
Schedule of Investments PIMCO RAE Fundamental Emerging Markets Fund (Cont.)
SHARES | MARKET VALUE (000S) | |||||||||||
China Resources Land Ltd. | 68,000 | $ | 197 | |||||||||
China Taiping Insurance Holdings Co. Ltd. (a) | 172,400 | 530 | ||||||||||
Poly Property Group Co. Ltd. | 1,303,000 | 421 | ||||||||||
Yuexiu Property Co. Ltd. | 608,000 | 105 | ||||||||||
|
| |||||||||||
1,952 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 0.2% | ||||||||||||
China Merchants Holdings International Co. Ltd. | 12,000 | 38 | ||||||||||
Shanghai Industrial Holdings Ltd. | 99,000 | 259 | ||||||||||
|
| |||||||||||
297 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 3.9% | ||||||||||||
China Mobile Ltd. | 457,000 | 5,144 | ||||||||||
China Unicom Hong Kong Ltd. | 1,444,000 | 1,746 | ||||||||||
|
| |||||||||||
6,890 | ||||||||||||
|
| |||||||||||
UTILITIES 0.2% | ||||||||||||
China Power International Development Ltd. | 223,000 | 128 | ||||||||||
China Resources Power Holdings Co. Ltd. | 138,000 | 266 | ||||||||||
Guangdong Investment Ltd. | 22,000 | 31 | ||||||||||
|
| |||||||||||
425 | ||||||||||||
|
| |||||||||||
Total Hong Kong | 10,464 | |||||||||||
|
| |||||||||||
INDIA 1.5% | ||||||||||||
CONSUMER DISCRETIONARY 0.2% | ||||||||||||
Tata Motors Ltd. SP - ADR (a) | 9,962 | 294 | ||||||||||
|
| |||||||||||
ENERGY 0.2% | ||||||||||||
Reliance Industries Ltd. SP - GDR | 12,004 | 367 | ||||||||||
|
| |||||||||||
FINANCIALS 0.5% | ||||||||||||
State Bank of India GDR | 25,189 | 847 | ||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 0.5% | ||||||||||||
Infosys Ltd. SP - ADR | 49,715 | 833 | ||||||||||
|
| |||||||||||
MATERIALS 0.1% | ||||||||||||
Vedanta Resources PLC | 64,511 | 260 | ||||||||||
|
| |||||||||||
Total India | 2,601 | |||||||||||
|
| |||||||||||
INDONESIA 1.8% | ||||||||||||
CONSUMER DISCRETIONARY 0.2% | ||||||||||||
Astra International Tbk PT | 759,900 | 327 | ||||||||||
|
| |||||||||||
CONSUMER STAPLES 0.1% | ||||||||||||
Indofood Sukses Makmur Tbk PT | 503,800 | 188 | ||||||||||
|
| |||||||||||
ENERGY 0.1% | ||||||||||||
Adaro Energy Tbk PT | 1,455,700 | 54 | ||||||||||
Bumi Resources Tbk PT (a) | 15,577,800 | 56 | ||||||||||
|
| |||||||||||
110 | ||||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
FINANCIALS 0.5% | ||||||||||||
Bank Central Asia Tbk PT | 225,700 | $ | 216 | |||||||||
Bank Mandiri Persero Tbk PT | 313,100 | 208 | ||||||||||
Bank Negara Indonesia Persero Tbk PT | 546,400 | 196 | ||||||||||
Bank Rakyat Indonesia Persero Tbk PT | 233,700 | 192 | ||||||||||
|
| |||||||||||
812 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 0.0% | ||||||||||||
Berlian Laju Tanker Tbk PT (a) | 707,200 | 0 | ||||||||||
United Tractors Tbk PT | 69,500 | 85 | ||||||||||
|
| |||||||||||
85 | ||||||||||||
|
| |||||||||||
MATERIALS 0.1% | ||||||||||||
Semen Indonesia Persero Tbk PT | 190,900 | 156 | ||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 0.6% | ||||||||||||
Telekomunikasi Indonesia Persero Tbk PT | 5,069,500 | 1,135 | ||||||||||
|
| |||||||||||
UTILITIES 0.2% | ||||||||||||
Perusahaan Gas Negara Persero Tbk | 1,401,000 | 276 | ||||||||||
|
| |||||||||||
Total Indonesia | 3,089 | |||||||||||
|
| |||||||||||
MEXICO 3.3% | ||||||||||||
CONSUMER DISCRETIONARY 0.0% | ||||||||||||
El Puerto de Liverpool S.A.B. de C.V. | 2,900 | 35 | ||||||||||
Grupo Televisa S.A.B. SP - ADR | 760 | 21 | ||||||||||
Urbi Desarrollos Urbanos S.A.B. de C.V. (a) | 212,200 | 0 | ||||||||||
|
| |||||||||||
56 | ||||||||||||
|
| |||||||||||
CONSUMER STAPLES 0.7% | ||||||||||||
Coca-Cola Femsa S.A.B. de C.V. SP - ADR | 500 | 35 | ||||||||||
Fomento Economico Mexicano S.A.B. de C.V. SP - ADR | 3,274 | 302 | ||||||||||
Gruma S.A.B. de C.V. ‘B’ | 2,600 | 37 | ||||||||||
Grupo Bimbo S.A.B. de C.V. ‘A’ (a) | 132,100 | 351 | ||||||||||
Kimberly-Clark de Mexico S.A.B. de C.V. ‘A’ | 71,100 | 166 | ||||||||||
Wal-Mart de Mexico S.A.B. de C.V. | 160,700 | 406 | ||||||||||
|
| |||||||||||
1,297 | ||||||||||||
|
| |||||||||||
FINANCIALS 0.4% | ||||||||||||
Grupo Financiero Inbursa S.A.B. de C.V. ‘O’ | 10,700 | 19 | ||||||||||
Grupo Financiero Santander Mexico S.A.B. de C.V. ADR ‘B’ | 81,631 | 708 | ||||||||||
|
| |||||||||||
727 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 0.2% | ||||||||||||
Alfa S.A.B. de C.V. ‘A’ | 13,800 | 27 | ||||||||||
Empresas ICA S.A.B. de C.V. (a) | 371,700 | 77 | ||||||||||
Grupo Aeromexico S.A.B. de C.V. (a) | 60,722 | 140 | ||||||||||
|
| |||||||||||
244 | ||||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
MATERIALS 0.4% | ||||||||||||
Cemex S.A.B. de C.V. SP - ADR (a) | 59,737 | $ | 333 | |||||||||
Fresnillo PLC | 10,000 | 104 | ||||||||||
Grupo Mexico S.A.B. de C.V. ‘B’ | 68,799 | 147 | ||||||||||
Industrias Penoles S.A.B. de C.V. | 13,320 | 137 | ||||||||||
|
| |||||||||||
721 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 1.6% | ||||||||||||
America Movil S.A.B. de C.V. SP - ADR ‘L’ | 203,301 | 2,858 | ||||||||||
|
| |||||||||||
Total Mexico | 5,903 | |||||||||||
|
| |||||||||||
NETHERLANDS 0.1% | ||||||||||||
CONSUMER DISCRETIONARY 0.1% | ||||||||||||
Steinhoff International Holdings NV | 24,155 | 125 | ||||||||||
|
| |||||||||||
Total Netherlands | 125 | |||||||||||
|
| |||||||||||
PERU 0.1% | ||||||||||||
MATERIALS 0.1% | ||||||||||||
Southern Copper Corp. | 5,591 | 146 | ||||||||||
|
| |||||||||||
Total Peru | 146 | |||||||||||
|
| |||||||||||
POLAND 2.5% | ||||||||||||
ENERGY 0.7% | ||||||||||||
Polski Koncern Naftowy Orlen S.A. | 61,896 | 1,066 | ||||||||||
Polskie Gornictwo Naftowe i Gazownictwo S.A. | 152,659 | 199 | ||||||||||
|
| |||||||||||
1,265 | ||||||||||||
|
| |||||||||||
FINANCIALS 0.4% | ||||||||||||
Bank Pekao S.A. | 4,072 | 148 | ||||||||||
Powszechna Kasa Oszczednosci Bank Polski S.A. | 61,153 | 425 | ||||||||||
Powszechny Zaklad Ubezpieczen S.A. | 20,496 | 177 | ||||||||||
|
| |||||||||||
750 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 0.0% | ||||||||||||
PKP Cargo S.A. | 3,789 | 66 | ||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 0.1% | ||||||||||||
Asseco Poland S.A. | 10,424 | 150 | ||||||||||
|
| |||||||||||
MATERIALS 0.4% | ||||||||||||
KGHM Polska Miedz S.A. | 38,772 | 625 | ||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 0.3% | ||||||||||||
Orange Polska S.A. | 282,679 | 473 | ||||||||||
|
| |||||||||||
UTILITIES 0.6% | ||||||||||||
Enea S.A. | 48,355 | 138 | ||||||||||
Energa S.A. | 36,336 | 117 | ||||||||||
PGE Polska Grupa Energetyczna S.A. | 182,222 | 591 | ||||||||||
Tauron Polska Energia S.A. | 281,224 | 206 | ||||||||||
|
| |||||||||||
1,052 | ||||||||||||
|
| |||||||||||
Total Poland | 4,381 | |||||||||||
|
| |||||||||||
32 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
SHARES | MARKET VALUE (000S) | |||||||||||
RUSSIA 14.0% | ||||||||||||
CONSUMER STAPLES 0.1% | ||||||||||||
Lenta Ltd. GDR (a) | 7,923 | $ | 54 | |||||||||
X5 Retail Group NV SP - GDR (a) | 6,444 | 122 | ||||||||||
|
| |||||||||||
176 | ||||||||||||
|
| |||||||||||
ENERGY 10.0% | ||||||||||||
Gazprom Neft PAO | 16,165 | 173 | ||||||||||
Gazprom PAO SP - ADR | 1,572,780 | 5,848 | ||||||||||
Lukoil PJSC SP - ADR | 153,179 | 4,959 | ||||||||||
Rosneft OAO SP - GDR | 509,114 | 1,775 | ||||||||||
Surgutneftegas OAO SP - ADR | 858,016 | 3,980 | ||||||||||
Tatneft PAO SP - ADR | 35,139 | 929 | ||||||||||
|
| |||||||||||
17,664 | ||||||||||||
|
| |||||||||||
FINANCIALS 0.5% | ||||||||||||
Sberbank of Russia SP - ADR | 101,343 | 595 | ||||||||||
VTB Bank PJSC GDR | 92,766 | 195 | ||||||||||
|
| |||||||||||
790 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 0.3% | ||||||||||||
Aeroflot - Russian Airlines OJSC | 592,660 | 456 | ||||||||||
|
| |||||||||||
MATERIALS 1.6% | ||||||||||||
Alrosa PAO | 61,468 | 47 | ||||||||||
Evraz PLC (a) | 33,342 | 36 | ||||||||||
Mechel SP - ADR | 165,977 | 136 | ||||||||||
MMC Norilsk Nickel PJSC ADR | 165,209 | 2,094 | ||||||||||
PhosAgro OAO GDR | 16,037 | 206 | ||||||||||
Severstal PAO GDR | 42,583 | 355 | ||||||||||
|
| |||||||||||
2,874 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 1.4% | ||||||||||||
MegaFon PJSC SP - GDR | 61,030 | 710 | ||||||||||
Mobile TeleSystems PJSC | 359,810 | 1,038 | �� | |||||||||
Rostelecom PJSC | 286,530 | 356 | ||||||||||
Sistema JSFC SP - GDR | 72,334 | 426 | ||||||||||
|
| |||||||||||
2,530 | ||||||||||||
|
| |||||||||||
UTILITIES 0.1% | ||||||||||||
Federal Grid Co. Unified Energy System PJSC | 114,440,000 | 92 | ||||||||||
Inter RAO UES PJSC | 1,990,000 | 30 | ||||||||||
RusHydro PJSC | 4,348,000 | 40 | ||||||||||
|
| |||||||||||
162 | ||||||||||||
|
| |||||||||||
Total Russia | 24,652 | |||||||||||
|
| |||||||||||
SOUTH AFRICA 9.4% | ||||||||||||
CONSUMER DISCRETIONARY 0.4% | ||||||||||||
Foschini Group Ltd. | 22,055 | 173 | ||||||||||
Imperial Holdings Ltd. | 29,297 | 227 | ||||||||||
Mr Price Group Ltd. | 2,298 | 30 | ||||||||||
Truworths International Ltd. | 15,775 | 93 |
SHARES | MARKET VALUE (000S) | |||||||||||
Woolworths Holdings Ltd. | 17,235 | $ | 112 | |||||||||
|
| |||||||||||
635 | ||||||||||||
|
| |||||||||||
CONSUMER STAPLES 0.1% | ||||||||||||
Shoprite Holdings Ltd. | 9,647 | 90 | ||||||||||
Tiger Brands Ltd. | 2,501 | 51 | ||||||||||
|
| |||||||||||
141 | ||||||||||||
|
| |||||||||||
ENERGY 1.1% | ||||||||||||
Exxaro Resources Ltd. | 47,370 | 135 | ||||||||||
Sasol Ltd. | 67,530 | 1,823 | ||||||||||
|
| |||||||||||
1,958 | ||||||||||||
|
| |||||||||||
FINANCIALS 2.8% | ||||||||||||
Barclays Africa Group Ltd. | 109,073 | 1,012 | ||||||||||
Discovery Ltd. | 2,910 | 25 | ||||||||||
FirstRand Ltd. | 134,840 | 368 | ||||||||||
Investec Ltd. | 11,519 | 81 | ||||||||||
Liberty Holdings Ltd. | 59,351 | 442 | ||||||||||
MMI Holdings Ltd. | 18,521 | 26 | ||||||||||
Nedbank Group Ltd. | 34,038 | 416 | ||||||||||
Sanlam Ltd. | 154,160 | 603 | ||||||||||
Standard Bank Group Ltd. | 262,700 | 1,926 | ||||||||||
|
| |||||||||||
4,899 | ||||||||||||
|
| |||||||||||
HEALTH CARE 0.0% | ||||||||||||
Netcare Ltd. | 32,946 | 72 | ||||||||||
|
| |||||||||||
INDUSTRIALS 0.5% | ||||||||||||
Aveng Ltd. | 71,944 | 10 | ||||||||||
Barloworld Ltd. | 93,912 | 378 | ||||||||||
Bidvest Group Ltd. | 13,978 | 297 | ||||||||||
Reunert Ltd. | 39,822 | 176 | ||||||||||
|
| |||||||||||
861 | ||||||||||||
|
| |||||||||||
MATERIALS 2.8% | ||||||||||||
AngloGold Ashanti Ltd. SP - ADR (a) | 134,372 | 954 | ||||||||||
Gold Fields Ltd. SP - ADR | 645,176 | 1,787 | ||||||||||
Impala Platinum Holdings Ltd. (a) | 146,021 | 236 | ||||||||||
Kumba Iron Ore Ltd. | 90,317 | 241 | ||||||||||
Lonmin PLC | 38,850 | 48 | ||||||||||
Mondi Ltd. | 1,818 | 36 | ||||||||||
Nampak Ltd. | 185,502 | 298 | ||||||||||
PPC Ltd. | 215,716 | 215 | ||||||||||
Sappi Ltd. (a) | 119,832 | 503 | ||||||||||
Sibanye Gold Ltd. | 390,444 | 592 | ||||||||||
|
| |||||||||||
4,910 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 1.7% | ||||||||||||
MTN Group Ltd. | 220,870 | 1,902 | ||||||||||
Telkom S.A. SOC Ltd. | 151,217 | 628 | ||||||||||
Vodacom Group Ltd. | 49,378 | 487 | ||||||||||
|
| |||||||||||
3,017 | ||||||||||||
|
| |||||||||||
Total South Africa | 16,493 | |||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
SOUTH KOREA 15.2% | ||||||||||||
CONSUMER DISCRETIONARY 2.6% | ||||||||||||
Hankook Tire Co. Ltd. | 1,320 | $ | 53 | |||||||||
Hyundai Department Store Co. Ltd. | 606 | 65 | ||||||||||
Hyundai Mobis Co. Ltd. | 761 | 159 | ||||||||||
Hyundai Motor Co. | 11,999 | 1,513 | ||||||||||
Kia Motors Corp. | 21,882 | 976 | ||||||||||
LG Electronics, Inc. | 34,323 | 1,561 | ||||||||||
Lotte Shopping Co. Ltd. | 1,496 | 294 | ||||||||||
|
| |||||||||||
4,621 | ||||||||||||
|
| |||||||||||
CONSUMER STAPLES 0.2% | ||||||||||||
E-MART Inc. | 1,346 | 216 | ||||||||||
KT&G Corp. | 2,071 | 184 | ||||||||||
|
| |||||||||||
400 | ||||||||||||
|
| |||||||||||
ENERGY 0.8% | ||||||||||||
GS Holdings Corp. | 9,500 | 407 | ||||||||||
S-Oil Corp. | 3,479 | 233 | ||||||||||
SK Innovation Co. Ltd. | 7,349 | 806 | ||||||||||
|
| |||||||||||
1,446 | ||||||||||||
|
| |||||||||||
FINANCIALS 3.3% | ||||||||||||
DGB Financial Group, Inc. | 13,633 | 116 | ||||||||||
Dongbu Insurance Co. Ltd. | 1,511 | 90 | ||||||||||
Hana Financial Group, Inc. | 12,473 | 249 | ||||||||||
Hanwha Life Insurance Co. Ltd. | 41,801 | 264 | ||||||||||
Hyundai Marine & Fire Insurance Co. Ltd. | 13,352 | 409 | ||||||||||
Industrial Bank of Korea | 49,003 | 512 | ||||||||||
KB Financial Group, Inc. | 28,100 | 792 | ||||||||||
Mirae Asset Life Insurance Co. Ltd. (a) | 17,057 | 73 | ||||||||||
Samsung Fire & Marine Insurance Co. Ltd. | 203 | 53 | ||||||||||
Samsung Life Insurance Co. Ltd. | 9,410 | 879 | ||||||||||
Shinhan Financial Group Co. Ltd. | 32,059 | 1,077 | ||||||||||
Tongyang Life Insurance Co. Ltd. | 5,511 | 55 | ||||||||||
Woori Bank | 168,310 | 1,259 | ||||||||||
|
| |||||||||||
5,828 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 1.6% | ||||||||||||
CJ Corp. | 3,021 | 642 | ||||||||||
Doosan Heavy Industries & Construction Co. Ltd. | 7,661 | 133 | ||||||||||
Doosan Infracore Co. Ltd. (a) | 20,710 | 82 | ||||||||||
Hanwha Corp. | 11,625 | 385 | ||||||||||
Korean Air Lines Co. Ltd. (a) | 7,292 | 171 | ||||||||||
LS Corp. | 9,784 | 333 | ||||||||||
SK Holdings Co. Ltd. | 5,048 | 1,029 | ||||||||||
SK Networks Co. Ltd. | 12,114 | 56 | ||||||||||
|
| |||||||||||
2,831 | ||||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 3.9% | ||||||||||||
LG Display Co. Ltd. | 27,007 | 560 | ||||||||||
Samsung Electro-Mechanics Co. Ltd. | 3,818 | 203 |
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 33 |
Table of Contents
Schedule of Investments PIMCO RAE Fundamental Emerging Markets Fund (Cont.)
SHARES | MARKET VALUE (000S) | |||||||||||
Samsung Electronics Co. Ltd. | 5,707 | $ | 6,087 | |||||||||
SK Hynix, Inc. | 2,100 | 54 | ||||||||||
|
| |||||||||||
6,904 | ||||||||||||
|
| |||||||||||
MATERIALS 0.7% | ||||||||||||
Hyosung Corp. | 1,520 | 150 | ||||||||||
LG Chem Ltd. | 686 | 190 | ||||||||||
POSCO Processing & Service Co. Ltd. | 5,506 | 771 | ||||||||||
|
| |||||||||||
1,111 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 1.8% | ||||||||||||
KT Corp. SP - ADR (a) | 113,975 | 1,357 | ||||||||||
LG Uplus Corp. | 106,662 | 942 | ||||||||||
SK Telecom Co. Ltd. SP - ADR | 40,701 | 820 | ||||||||||
|
| |||||||||||
3,119 | ||||||||||||
|
| |||||||||||
UTILITIES 0.3% | ||||||||||||
Korea Electric Power Corp. | 12,288 | 521 | ||||||||||
|
| |||||||||||
Total South Korea | 26,781 | |||||||||||
|
| |||||||||||
TAIWAN 8.6% | ||||||||||||
CONSUMER DISCRETIONARY 0.3% | ||||||||||||
Pou Chen Corp. | 320,000 | 418 | ||||||||||
Ruentex Industries Ltd. | 26,000 | 48 | ||||||||||
|
| |||||||||||
466 | ||||||||||||
|
| |||||||||||
CONSUMER STAPLES 0.2% | ||||||||||||
Uni-President Enterprises Corp. | 260,640 | 435 | ||||||||||
|
| |||||||||||
FINANCIALS 0.9% | ||||||||||||
China Development Financial Holding Corp. | 724,000 | 181 | ||||||||||
China Life Insurance Co. Ltd. | 764,300 | 584 | ||||||||||
CTBC Financial Holding Co. Ltd. | 154,624 | 79 | ||||||||||
First Financial Holding Co. Ltd. | 105,900 | 49 | ||||||||||
Fubon Financial Holding Co. Ltd. | 58,000 | 79 | ||||||||||
Hua Nan Financial Holdings Co. Ltd. | 75,748 | 35 | ||||||||||
Mega Financial Holding Co. Ltd. | 327,658 | 211 | ||||||||||
Shanghai Commercial & Savings Bank Ltd. | 50,018 | 47 | ||||||||||
Shin Kong Financial Holding Co. Ltd. | 490,903 | 106 | ||||||||||
SinoPac Financial Holdings Co. Ltd. | 286,144 | 81 | ||||||||||
Taishin Financial Holding Co. Ltd. | 233,000 | 81 | ||||||||||
Yuanta Financial Holding Co. Ltd. | 123,147 | 45 | ||||||||||
|
| |||||||||||
1,578 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 0.1% | ||||||||||||
Far Eastern New Century Corp. | 318,520 | 249 | ||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 5.5% | ||||||||||||
Acer, Inc. (a) | 332,000 | 122 | ||||||||||
Advanced Semiconductor Engineering, Inc. | 93,000 | 107 | ||||||||||
Asustek Computer, Inc. | 64,000 | 528 |
SHARES | MARKET VALUE (000S) | |||||||||||
AU Optronics Corp. | 960,000 | $ | 283 | |||||||||
Catcher Technology Co. Ltd. | 8,000 | 67 | ||||||||||
Compal Electronics, Inc. | 1,141,000 | 638 | ||||||||||
Delta Electronics, Inc. | 10,312 | 48 | ||||||||||
Hon Hai Precision Industry Co. Ltd. | 428,950 | 1,050 | ||||||||||
HTC Corp. | 171,000 | 404 | ||||||||||
Innolux Corp. | 1,094,000 | 329 | ||||||||||
Inventec Corp. | 113,000 | 74 | ||||||||||
Lite-On Technology Corp. | 537,770 | 519 | ||||||||||
MediaTek, Inc. | 3,000 | 23 | ||||||||||
Pegatron Corp. | 169,000 | 367 | ||||||||||
Powertech Technology, Inc. | 154,000 | 304 | ||||||||||
Quanta Computer, Inc. | 101,000 | 162 | ||||||||||
Siliconware Precision Industries Co. Ltd. | 24,000 | 38 | ||||||||||
Synnex Technology International Corp. | 20,000 | 19 | ||||||||||
Taiwan Semiconductor Manufacturing Co. Ltd. SP- ADR | 160,436 | 3,650 | ||||||||||
United Microelectronics Corp. | 1,501,000 | 548 | ||||||||||
Wistron Corp. | 549,821 | 308 | ||||||||||
WPG Holdings Ltd. | 47,000 | 45 | ||||||||||
|
| |||||||||||
9,633 | ||||||||||||
|
| |||||||||||
MATERIALS 0.4% | ||||||||||||
Asia Cement Corp. | 78,000 | 65 | ||||||||||
China Steel Corp. | 545,000 | 297 | ||||||||||
Formosa Chemicals & Fibre Corp. | 58,000 | 130 | ||||||||||
Taiwan Cement Corp. | 277,000 | 229 | ||||||||||
|
| |||||||||||
721 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 1.2% | ||||||||||||
Chunghwa Telecom Co. Ltd. | 511,000 | 1,540 | ||||||||||
Far EasTone Telecommunications Co. Ltd. | 128,000 | 263 | ||||||||||
Taiwan Mobile Co. Ltd. | 87,000 | 264 | ||||||||||
|
| |||||||||||
2,067 | ||||||||||||
|
| |||||||||||
Total Taiwan | 15,149 | |||||||||||
|
| |||||||||||
THAILAND 2.9% | ||||||||||||
CONSUMER STAPLES 0.0% | ||||||||||||
Charoen Pokphand Foods PCL | 86,200 | 43 | ||||||||||
|
| |||||||||||
ENERGY 1.4% | ||||||||||||
Banpu Public Co. Ltd. | 1,220,100 | 540 | ||||||||||
PTT Exploration & Production PCL | 388,000 | 615 | ||||||||||
PTT PCL | 174,500 | 1,175 | ||||||||||
Thai Oil PCL | 132,200 | 241 | ||||||||||
|
| |||||||||||
2,571 | ||||||||||||
|
| |||||||||||
FINANCIALS 1.2% | ||||||||||||
Bangkok Bank PCL | 204,700 | 874 | ||||||||||
Kasikornbank PCL | 97,300 | 402 | ||||||||||
Krung Thai Bank PCL | 1,082,075 | 499 |
SHARES | MARKET VALUE (000S) | |||||||||||
Siam Commercial Bank PCL | 112,600 | $ | 372 | |||||||||
|
| |||||||||||
2,147 | ||||||||||||
|
| |||||||||||
MATERIALS 0.2% | ||||||||||||
PTT Global Chemical PCL | 144,600 | 200 | ||||||||||
Siam Cement PCL | 10,000 | 126 | ||||||||||
|
| |||||||||||
326 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 0.1% | ||||||||||||
Advanced Info Service PCL | 25,200 | 106 | ||||||||||
|
| |||||||||||
Total Thailand | 5,193 | |||||||||||
|
| |||||||||||
Total Common Stocks (Cost $209,914) | 169,905 | |||||||||||
|
| |||||||||||
EQUITY-LINKED SECURITIES 3.8% | ||||||||||||
CURACAO 0.0% | ||||||||||||
FINANCIALS 0.0% | ||||||||||||
Merrill Lynch International & Co., Housing Development Finance Corp. Ltd. - Exp. 05/22/2018 | 1,496 | 29 | ||||||||||
|
| |||||||||||
Total Curacao | 29 | |||||||||||
|
| |||||||||||
IRELAND 1.1% | ||||||||||||
CONSUMER DISCRETIONARY 0.1% | ||||||||||||
Citigroup Global Markets Holdings, Inc., Hero MotoCorp Ltd. - Exp. 02/12/2016 | 954 | 39 | ||||||||||
Citigroup Global Markets Holdings, Inc., Mahindra & Mahindra Ltd. - Exp. 02/12/2016 | 7,943 | 152 | ||||||||||
|
| |||||||||||
191 | ||||||||||||
|
| |||||||||||
ENERGY 0.8% | ||||||||||||
Citigroup Global Markets Holdings, Inc., Bharat Petroleum Corp. Ltd. - Exp. 02/12/2016 | 17,992 | 242 | ||||||||||
Citigroup Global Markets Holdings, Inc., Coal India Ltd. - Exp. 02/12/2016 | 29,464 | 147 | ||||||||||
Citigroup Global Markets Holdings, Inc., Hindustan Petroleum Corp. Ltd. - Exp. 02/12/2016 | 47,360 | 598 | ||||||||||
Citigroup Global Markets Holdings, Inc., Jindal Steel & Power Ltd. - Exp. 02/12/2016 | 30,745 | 45 | ||||||||||
Citigroup Global Markets Holdings, Inc., Oil & Natural Gas Corp. Ltd. - Exp. 02/12/2016 | 84,866 | 310 | ||||||||||
|
| |||||||||||
1,342 | ||||||||||||
|
| |||||||||||
FINANCIALS 0.0% | ||||||||||||
Citigroup Global Markets Holdings, Inc., Yes Bank Ltd. - Exp. 02/12/2016 | 3,056 | 34 | ||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 0.0% | ||||||||||||
Citigroup Global Markets Holdings, Inc., HCL Technologies Ltd. - Exp. 02/12/2016 | 1,961 | 25 | ||||||||||
|
|
34 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
SHARES | MARKET VALUE (000S) | |||||||||||
TELECOMMUNICATION SERVICES 0.2% | ||||||||||||
Citigroup Global Markets Holdings, Inc., Bharti Airtel Ltd. - Exp. 02/12/2016 | 20,296 | $ | 104 | |||||||||
Citigroup Global Markets Holdings, Inc., Reliance Communications Ltd. - Exp. 02/12/2016 | 146,592 | 196 | ||||||||||
|
| |||||||||||
300 | ||||||||||||
|
| |||||||||||
Total Ireland | 1,892 | |||||||||||
|
| |||||||||||
LUXEMBOURG 1.6% | ||||||||||||
CONSUMER DISCRETIONARY 0.3% | ||||||||||||
JP Morgan Chase Bank, N.A., Bajaj Auto Ltd. - Exp. 07/29/2016 | 1,314 | 50 | ||||||||||
Merrill Lynch International & Co., ITC Ltd. - Exp. 05/22/2018 | 95,007 | 471 | ||||||||||
|
| |||||||||||
521 | ||||||||||||
|
| |||||||||||
ENERGY 0.1% | ||||||||||||
JP Morgan Chase Bank, N.A., Indian Oil Corp. Ltd. - Exp. 09/02/2019 | 7,260 | 47 | ||||||||||
Merrill Lynch International & Co., Cairn India Ltd. - Exp. 05/31/2018 | 16,897 | 35 | ||||||||||
|
| |||||||||||
82 | ||||||||||||
|
| |||||||||||
FINANCIALS 0.4% | ||||||||||||
JP Morgan Chase Bank, N.A., Axis Bank Ltd. - Exp. 01/25/2018 | 26,967 | 183 | ||||||||||
JP Morgan Chase Bank, N.A., ICICI Bank Ltd. - Exp. 07/02/2019 | 97,833 | 386 | ||||||||||
JP Morgan Chase Bank, N.A., Punjab National Bank - Exp. 05/05/2016 | 111,129 | 194 | ||||||||||
|
| |||||||||||
763 | ||||||||||||
|
| |||||||||||
HEALTH CARE 0.3% | ||||||||||||
JP Morgan Chase Bank, N.A., Dr Reddy’s Laboratories Ltd. - Exp. 03/03/2020 | 1,726 | 81 | ||||||||||
JP Morgan Chase Bank, N.A., Sun Pharmaceutical Industries Ltd. - Exp. 04/03/2018 | 27,397 | 340 | ||||||||||
|
| |||||||||||
421 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 0.0% | ||||||||||||
Merrill Lynch International & Co., Hindalco Industries Ltd. - Exp. 11/25/2019 | 46,255 | 59 | ||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 0.3% | ||||||||||||
Merrill Lynch International & Co., Hindustan Unilever Ltd. - Exp. 06/17/2019 | 15,484 | 202 | ||||||||||
Merrill Lynch International & Co., Larsen & Toubro Ltd. - Exp. 05/29/2018 | 6,182 | 119 | ||||||||||
Merrill Lynch International & Co., Tata Consultancy Services Ltd. - Exp. 01/08/2019 | 6,570 | 242 | ||||||||||
|
| |||||||||||
563 | ||||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
TELECOMMUNICATION SERVICES 0.0% | ||||||||||||
Merrill Lynch International & Co., Idea Cellular Ltd. - Exp. 06/07/2018 | 11,162 | $ | 24 | |||||||||
|
| |||||||||||
UTILITIES 0.2% | ||||||||||||
JP Morgan Chase Bank, N.A., Power Grid Corp. of India Ltd. - Exp. 12/05/2018 | 34,613 | 74 | ||||||||||
JP Morgan Chase Bank, N.A., Tata Power Co. Ltd. - Exp. 04/05/2019 | 261,265 | 268 | ||||||||||
JP Morgan Chase Bank, N.A., Tata Power Co. Ltd. - Exp. 04/26/2016 | 38,588 | 39 | ||||||||||
|
| |||||||||||
381 | ||||||||||||
|
| |||||||||||
Total Luxembourg | 2,814 | |||||||||||
|
| |||||||||||
NETHERLANDS 0.5% | ||||||||||||
MATERIALS 0.5% | ||||||||||||
JP Morgan Chase Bank, N.A., Tata Steel Ltd. - Exp. 12/08/2020 | 235,079 | 922 | ||||||||||
|
| |||||||||||
Total Netherlands | 922 | |||||||||||
|
| |||||||||||
UNITED KINGDOM 0.6% | ||||||||||||
FINANCIALS 0.1% | ||||||||||||
HSBC Bank PLC, Bank of Boroda - Exp. 06/30/2016 | 83,933 | 199 | ||||||||||
|
| |||||||||||
INDUSTRIALS 0.3% | ||||||||||||
HSBC Bank PLC, Bharat Heavy Electricals Ltd. - Exp. 06/30/2016 | 54,811 | 140 | ||||||||||
HSBC Bank PLC, Jaiprakash Associates Ltd. - Exp. 10/28/2016 | 1,161,854 | 209 | ||||||||||
HSBC Bank PLC, JSW Steel Ltd. - Exp. 06/30/2016 | 9,242 | 144 | ||||||||||
|
| |||||||||||
493 | ||||||||||||
|
| |||||||||||
UTILITIES 0.1% | ||||||||||||
HSBC Bank PLC, GAIL India Ltd. - Exp. 03/10/2016 | 9,592 | 54 | ||||||||||
HSBC Bank PLC, NTPC Ltd. - Exp. 03/10/2016 | 106,627 | 236 | ||||||||||
|
| |||||||||||
290 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 0.1% | ||||||||||||
HSBC Bank PLC, Aditya Birla Nuvo Ltd. - Exp. 06/30/2016 | 5,177 | 169 | ||||||||||
|
| |||||||||||
Total United Kingdom | 1,151 | |||||||||||
|
| |||||||||||
Total Equity-Linked Securities (Cost $7,151) | 6,808 | |||||||||||
|
| |||||||||||
PREFERRED STOCKS 5.4% | ||||||||||||
BRAZIL 4.7% | ||||||||||||
CONSUMER DISCRETIONARY 0.2% | ||||||||||||
Oi S.A. | 773,070 | 379 | ||||||||||
|
| |||||||||||
CONSUMER STAPLES 0.2% | ||||||||||||
Cia Brasileira de Distribuicao | 39,900 | 420 | ||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
FINANCIALS 0.1% | ||||||||||||
Banco do Estado do Rio Grande do Sul S.A. | 108,700 | $ | 161 | |||||||||
|
| |||||||||||
MATERIALS 2.8% | ||||||||||||
Braskem S.A. | 57,400 | 399 | ||||||||||
Metalurgica Gerdau S.A. | 519,800 | 217 | ||||||||||
Suzano Papel e Celulose S.A. | 22,600 | 107 | ||||||||||
Usinas Siderurgicas de Minas Gerais S.A. | 145,400 | 56 | ||||||||||
Vale S.A. | 1,625,400 | 4,164 | ||||||||||
|
| |||||||||||
4,943 | ||||||||||||
|
| |||||||||||
UTILITIES 1.4% | ||||||||||||
AES Tiete S.A. | 125,800 | 460 | ||||||||||
Centrais Eletricas Brasileiras S.A. | 443,400 | 1,164 | ||||||||||
Cia Energetica de Sao Paulo | 117,800 | 397 | ||||||||||
Cia Paranaense de Energia | 36,300 | 222 | ||||||||||
Eletropaulo Metropolitana Eletricidade de Sao Paulo S.A. | 107,700 | 228 | ||||||||||
|
| |||||||||||
2,471 | ||||||||||||
|
| |||||||||||
Total Brazil | 8,374 | |||||||||||
|
| |||||||||||
RUSSIA 0.7% | ||||||||||||
ENERGY 0.7% | ||||||||||||
AK Transneft OAO | 339 | 902 | ||||||||||
Bashneft PAO | 11,073 | 261 | ||||||||||
|
| |||||||||||
1,163 | ||||||||||||
|
| |||||||||||
Total Russia | 1,163 | |||||||||||
|
| |||||||||||
Total Preferred Stocks (Cost $14,093) |
| 9,537 | ||||||||||
|
| |||||||||||
REAL ESTATE INVESTMENT TRUSTS 0.1% | ||||||||||||
SOUTH AFRICA 0.1% | ||||||||||||
FINANCIALS 0.1% | ||||||||||||
Growthpoint Properties Ltd. | 49,382 | 74 | ||||||||||
Redefine Properties Ltd. | 34,876 | 22 | ||||||||||
|
| |||||||||||
96 | ||||||||||||
|
| |||||||||||
Total Real Estate Investment Trusts | 96 | |||||||||||
|
| |||||||||||
RIGHTS 0.0% | ||||||||||||
BRAZIL 0.0% | ||||||||||||
INDUSTRIALS 0.0% | ||||||||||||
Rumo Logistica Operadora Multimodal S.A. | 6,852 | 0 | ||||||||||
|
| |||||||||||
Total Rights (Cost $0) | 0 | |||||||||||
|
| |||||||||||
Total Investments in Securities (Cost $231,275) | 186,346 | |||||||||||
Total Investments 105.7% (Cost $231,275) | $ | 186,346 | ||||||||||
Financial Derivative (Cost or Premiums, net $0) | (32 | ) | ||||||||||
Other Assets and Liabilities, net (5.7%) | (10,065 | ) | ||||||||||
|
| |||||||||||
Net Assets 100.0% | $ | 176,249 | ||||||||||
|
|
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 35 |
Table of Contents
Schedule of Investments PIMCO RAE Fundamental Emerging Markets Fund (Cont.)
NOTES TO SCHEDULE OF INVESTMENTS (AMOUNTS IN THOUSANDS*):
* | A zero balance may reflect actual amounts rounding to less than one thousand. |
(a) | Security did not produce income within the last twelve months. |
(b) FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER
FORWARD FOREIGN CURRENCY CONTRACTS:
Counterparty | Settlement Month | Currency to | Currency to | Unrealized Appreciation/ (Depreciation) | ||||||||||||||||||||||||
Asset | Liability | |||||||||||||||||||||||||||
SSB | 01/2016 | BRL | 272 | $ | 69 | $ | 0 | $ | 0 | |||||||||||||||||||
01/2016 | $ | 922 | BRL | 3,558 | 0 | (23 | ) | |||||||||||||||||||||
01/2016 | 1,049 | ZAR | 16,089 | 0 | (9 | ) | ||||||||||||||||||||||
01/2016 | ZAR | 557 | $ | 36 | 0 | 0 | ||||||||||||||||||||||
|
|
|
| |||||||||||||||||||||||||
Total Forward Foreign Currency Contracts |
| $ | 0 | $ | (32 | ) | ||||||||||||||||||||||
|
|
|
|
FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER SUMMARY
The following is a summary by counterparty of the market value of OTC financial derivative instruments and collateral (received)/pledged as of December 31, 2015:
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||||||||||||||
Counterparty | Forward Foreign Currency Contracts | Purchased Options | Swap Agreements | Total Over the Counter | Forward Foreign Currency Contracts | Written Options | Swap Agreements | Total Over the Counter | Net Market Value of OTC Derivatives | Collateral (Received)/ Pledged | Net Exposure (1) | |||||||||||||||||||||||||||||||||||
SSB | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | (32 | ) | $ | 0 | $ | 0 | $ | (32 | ) | $ | (32 | ) | $ | 0 | $ | (32 | ) | ||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(1) | Net Exposure represents the net receivable/(payable) that would be due from/to the counterparty in the event of default. Exposure from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same legal entity. See Note 6, Principal Risks, in the Notes to Financial Statements for more information regarding master netting arrangements. |
FAIR VALUE OF FINANCIAL DERIVATIVE INSTRUMENTS
The following is a summary of the fair valuation of the Fund’s derivative instruments categorized by risk exposure. See Note 6, Principal Risks, in the Notes to Financial Statements on risks of the Fund.
Fair Values of Financial Derivative Instruments on the Statements of Assets and Liabilities as of December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Financial Derivative Instruments - Liabilities | ||||||||||||||||||||||||
Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | 32 | $ | 0 | $ | 32 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
The effect of Financial Derivative Instruments on the Statements of Operations for the period ended December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Net Realized (Loss) on Financial Derivative Instruments | ||||||||||||||||||||||||
Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | (5 | ) | $ | 0 | $ | (5 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Net Change in Unrealized (Depreciation) on Financial Derivative Instruments |
| |||||||||||||||||||||||
Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | (32 | ) | $ | 0 | $ | (32 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
36 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
FAIR VALUE MEASUREMENTS
The following is a summary of the fair valuations according to the inputs used as of December 31, 2015 in valuing the Fund’s assets and liabilities:
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Investments in Securities, at Value |
| |||||||||||||||
Common Stocks | ||||||||||||||||
Brazil | ||||||||||||||||
Consumer Discretionary | $ | 0 | $ | 54 | $ | 0 | $ | 54 | ||||||||
Consumer Staples | 404 | 1,060 | 0 | 1,464 | ||||||||||||
Energy | 307 | 41 | 0 | 348 | ||||||||||||
Financials | 4,153 | 2,306 | 0 | 6,459 | ||||||||||||
Industrials | 49 | 217 | 0 | 266 | ||||||||||||
Materials | 1,636 | 0 | 0 | 1,636 | ||||||||||||
Telecommunication Services | 1,409 | 0 | 0 | 1,409 | ||||||||||||
Utilities | 2,756 | 1,520 | 0 | 4,276 | ||||||||||||
China | ||||||||||||||||
Consumer Discretionary | 0 | 238 | 0 | 238 | ||||||||||||
Consumer Staples | 0 | 28 | 0 | 28 | ||||||||||||
Energy | 0 | 5,925 | 0 | 5,925 | ||||||||||||
Financials | 0 | 29,314 | 39 | 29,353 | ||||||||||||
Industrials | 0 | 281 | 0 | 281 | ||||||||||||
Information Technology | 90 | 136 | 0 | 226 | ||||||||||||
Materials | 0 | 860 | 0 | 860 | ||||||||||||
Telecommunication Services | 0 | 1,795 | 0 | 1,795 | ||||||||||||
Utilities | 0 | 275 | 0 | 275 | ||||||||||||
Greece | ||||||||||||||||
Telecommunication Services | 0 | 35 | 0 | 35 | ||||||||||||
Hong Kong | ||||||||||||||||
Consumer Staples | 0 | 859 | 0 | 859 | ||||||||||||
Energy | 0 | 41 | 0 | 41 | ||||||||||||
Financials | 0 | 1,952 | 0 | 1,952 | ||||||||||||
Industrials | 0 | 297 | 0 | 297 | ||||||||||||
Telecommunication Services | 0 | 6,890 | 0 | 6,890 | ||||||||||||
Utilities | 0 | 425 | 0 | 425 | ||||||||||||
India | ||||||||||||||||
Consumer Discretionary | 294 | 0 | 0 | 294 | ||||||||||||
Energy | 367 | 0 | 0 | 367 | ||||||||||||
Financials | 0 | 847 | 0 | 847 | ||||||||||||
Information Technology | 833 | 0 | 0 | 833 | ||||||||||||
Materials | 0 | 260 | 0 | 260 | ||||||||||||
Indonesia | ||||||||||||||||
Consumer Discretionary | 0 | 327 | 0 | 327 | ||||||||||||
Consumer Staples | 0 | 188 | 0 | 188 | ||||||||||||
Energy | 0 | 110 | 0 | 110 | ||||||||||||
Financials | 0 | 812 | 0 | 812 | ||||||||||||
Industrials | 0 | 85 | 0 | 85 | ||||||||||||
Materials | 0 | 156 | 0 | 156 | ||||||||||||
Telecommunication Services | 0 | 1,135 | 0 | 1,135 | ||||||||||||
Utilities | 0 | 276 | 0 | 276 | ||||||||||||
Mexico | ||||||||||||||||
Consumer Discretionary | 56 | 0 | 0 | 56 | ||||||||||||
Consumer Staples | 1,297 | 0 | 0 | 1,297 | ||||||||||||
Financials | 727 | 0 | 0 | 727 | ||||||||||||
Industrials | 244 | 0 | 0 | 244 | ||||||||||||
Materials | 617 | 104 | 0 | 721 | ||||||||||||
Telecommunication Services | 2,858 | 0 | 0 | 2,858 | ||||||||||||
Netherlands | ||||||||||||||||
Consumer Discretionary | 125 | 0 | 0 | 125 | ||||||||||||
Peru | ||||||||||||||||
Materials | 146 | 0 | 0 | 146 | ||||||||||||
Poland | ||||||||||||||||
Energy | 0 | 1,265 | 0 | 1,265 | ||||||||||||
Financials | 0 | 750 | 0 | 750 | ||||||||||||
Industrials | 0 | 66 | 0 | 66 | ||||||||||||
Information Technology | 0 | 150 | 0 | 150 | ||||||||||||
Materials | 0 | 625 | 0 | 625 | ||||||||||||
Telecommunication Services | 473 | 0 | 0 | 473 | ||||||||||||
Utilities | 0 | 1,052 | 0 | 1,052 | ||||||||||||
Russia | ||||||||||||||||
Consumer Staples | 122 | 54 | 0 | 176 | ||||||||||||
Energy | 0 | 17,664 | 0 | 17,664 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Financials | $ | 0 | $ | 790 | $ | 0 | $ | 790 | ||||||||
Industrials | 0 | 456 | 0 | 456 | ||||||||||||
Materials | 136 | 2,738 | 0 | 2,874 | ||||||||||||
Telecommunication Services | 0 | 2,530 | 0 | 2,530 | ||||||||||||
Utilities | 0 | 162 | 0 | 162 | ||||||||||||
South Africa | ||||||||||||||||
Consumer Discretionary | 30 | 605 | 0 | 635 | ||||||||||||
Consumer Staples | 0 | 141 | 0 | 141 | ||||||||||||
Energy | 0 | 1,958 | 0 | 1,958 | ||||||||||||
Financials | 0 | 4,899 | 0 | 4,899 | ||||||||||||
Health Care | 0 | 72 | 0 | 72 | ||||||||||||
Industrials | 176 | 685 | 0 | 861 | ||||||||||||
Materials | 2,741 | 2,169 | 0 | 4,910 | ||||||||||||
Telecommunication Services | 0 | 3,017 | 0 | 3,017 | ||||||||||||
South Korea | ||||||||||||||||
Consumer Discretionary | 0 | 4,621 | 0 | 4,621 | ||||||||||||
Consumer Staples | 0 | 400 | 0 | 400 | ||||||||||||
Energy | 0 | 1,446 | 0 | 1,446 | ||||||||||||
Financials | 264 | 5,564 | 0 | 5,828 | ||||||||||||
Industrials | 0 | 2,831 | 0 | 2,831 | ||||||||||||
Information Technology | 0 | 6,904 | 0 | 6,904 | ||||||||||||
Materials | 0 | 1,111 | 0 | 1,111 | ||||||||||||
Telecommunication Services | 2,177 | 942 | 0 | 3,119 | ||||||||||||
Utilities | 0 | 521 | 0 | 521 | ||||||||||||
Taiwan | ||||||||||||||||
Consumer Discretionary | 0 | 466 | 0 | 466 | ||||||||||||
Consumer Staples | 0 | 435 | 0 | 435 | ||||||||||||
Financials | 47 | 1,531 | 0 | 1,578 | ||||||||||||
Industrials | 0 | 249 | 0 | 249 | ||||||||||||
Information Technology | 3,650 | 5,983 | 0 | 9,633 | ||||||||||||
Materials | 0 | 721 | 0 | 721 | ||||||||||||
Telecommunication Services | 0 | 2,067 | 0 | 2,067 | ||||||||||||
Thailand | ||||||||||||||||
Consumer Staples | 0 | 43 | 0 | 43 | ||||||||||||
Energy | 0 | 2,571 | 0 | 2,571 | ||||||||||||
Financials | 0 | 2,147 | 0 | 2,147 | ||||||||||||
Materials | 0 | 326 | 0 | 326 | ||||||||||||
Telecommunication Services | 0 | 106 | 0 | 106 | ||||||||||||
Equity-Linked Securities | ||||||||||||||||
Curacao | ||||||||||||||||
Financials | 0 | 29 | 0 | 29 | ||||||||||||
Ireland | ||||||||||||||||
Consumer Discretionary | 0 | 191 | 0 | 191 | ||||||||||||
Energy | 0 | 1,342 | 0 | 1,342 | ||||||||||||
Financials | 0 | 34 | 0 | 34 | ||||||||||||
Information Technology | 0 | 25 | 0 | 25 | ||||||||||||
Telecommunication Services | 0 | 300 | 0 | 300 | ||||||||||||
Luxembourg | ||||||||||||||||
Consumer Discretionary | 0 | 521 | 0 | 521 | ||||||||||||
Energy | 0 | 82 | 0 | 82 | ||||||||||||
Financials | 0 | 763 | 0 | 763 | ||||||||||||
Health Care | 0 | 421 | 0 | 421 | ||||||||||||
Industrials | 0 | 59 | 0 | 59 | ||||||||||||
Information Technology | 0 | 563 | 0 | 563 | ||||||||||||
Telecommunication Services | 0 | 24 | 0 | 24 | ||||||||||||
Utilities | 0 | 381 | 0 | 381 | ||||||||||||
Netherlands | ||||||||||||||||
Materials | 0 | 922 | 0 | 922 | ||||||||||||
United Kingdom | ||||||||||||||||
Financials | 0 | 199 | 0 | 199 | ||||||||||||
Industrials | 0 | 493 | 0 | 493 | ||||||||||||
Utilities | 0 | 290 | 0 | 290 | ||||||||||||
Telecommunication Services | 0 | 169 | 0 | 169 | ||||||||||||
Preferred Stocks | ||||||||||||||||
Brazil | ||||||||||||||||
Consumer Discretionary | 0 | 379 | 0 | 379 | ||||||||||||
Consumer Staples | 0 | 420 | 0 | 420 |
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 37 |
Table of Contents
Schedule of Investments PIMCO RAE Fundamental Emerging Markets Fund (Cont.)
December 31, 2015 (Unaudited)
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Financials | $ | 0 | $ | 161 | $ | 0 | $ | 161 | ||||||||
Materials | 0 | 4,943 | 0 | 4,943 | ||||||||||||
Utilities | 460 | 2,011 | 0 | 2,471 | ||||||||||||
Russia | ||||||||||||||||
Energy | 0 | 1,163 | 0 | 1,163 | ||||||||||||
Real Estate Investment Trusts | ||||||||||||||||
South Africa | ||||||||||||||||
Financials | 0 | 96 | 0 | 96 | ||||||||||||
Total Investments | $ | 28,644 | $ | 157,663 | $ | 39 | $ | 186,346 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Financial Derivative Instruments - Liabilities |
| |||||||||||||||
Over the counter | $ | 0 | $ | (32 | ) | $ | 0 | $ | (32 | ) | ||||||
Totals | $ | 28,644 | $ | 157,631 | $ | 39 | $ | �� 186,314 |
There were assets and liabilities valued at $16,333 transferred from Level 1 to Level 2 during the period ended December 31, 2015. There were no significant assets and liabilities transferred from Level 2 to Level 1 during the period ended December 31, 2015. There were no significant transfers between Levels 2 and 3 during the period ended December 31, 2015.
38 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
Schedule of Investments PIMCO RAE Fundamental Global Fund
December 31, 2015 (Unaudited)
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN AFFILIATES 99.9% | ||||||||||||
MUTUAL FUNDS (a) 99.9% | ||||||||||||
UNITED STATES 99.9% | ||||||||||||
PIMCO RAE Fundamental Emerging Markets Fund | 2,395,852 | $ | 17,993 | |||||||||
PIMCO RAE Fundamental International Fund | 8,447,196 | 73,068 | ||||||||||
PIMCO RAE Fundamental US Fund | 12,255,585 | 113,487 | ||||||||||
|
| |||||||||||
Total Mutual Funds (Cost $217,974) |
| 204,548 | ||||||||||
|
| |||||||||||
Total Investments in Affiliates (Cost $217,974) | 204,548 | |||||||||||
Total Investments 99.9% (Cost $217,974) | $ | 204,548 | ||||||||||
Other Assets and Liabilities, net 0.1% | 117 | |||||||||||
|
| |||||||||||
Net Assets 100.0% | $ | 204,665 | ||||||||||
|
|
NOTES TO SCHEDULE OF INVESTMENTS (AMOUNTS IN THOUSANDS*):
* | A zero balance may reflect actual amounts rounding to less than one thousand. |
(a) | Institutional Class Shares of each Fund. |
FAIR VALUE MEASUREMENTS
The following is a summary of the fair valuations according to the inputs used as of December 31, 2015 in valuing the Fund’s assets and liabilities:
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Investments in Affiliates, at Value | ||||||||||||||||
Mutual Funds | ||||||||||||||||
United States | $ | 204,548 | $ | 0 | $ | 0 | $ | 204,548 | ||||||||
Totals | $ | 204,548 | $ | 0 | $ | 0 | $ | 204,548 |
There were no significant transfers between Levels 1, 2, or 3 during the period ended December 31, 2015.
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 39 |
Table of Contents
Schedule of Investments PIMCO RAE Fundamental Global ex-US Fund
December 31, 2015 (Unaudited)
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN AFFILIATES 99.9% | ||||||||||||
MUTUAL FUNDS (a) 99.9% | ||||||||||||
UNITED STATES 99.9% | ||||||||||||
PIMCO RAE Fundamental Emerging Markets Fund | 1,601,939 | $ | 12,030 | |||||||||
PIMCO RAE Fundamental International Fund | 5,689,906 | 49,218 | ||||||||||
|
| |||||||||||
Total Mutual Funds (Cost $72,361) |
| 61,248 | ||||||||||
|
| |||||||||||
Total Investments in Affiliates (Cost $72,361) | 61,248 | |||||||||||
Total Investments 99.9% (Cost $72,361) | $ | 61,248 | ||||||||||
Other Assets and Liabilities, net 0.1% | 34 | |||||||||||
|
| |||||||||||
Net Assets 100.0% | $ | 61,282 | ||||||||||
|
|
NOTES TO SCHEDULE OF INVESTMENTS (AMOUNTS IN THOUSANDS*):
* | A zero balance may reflect actual amounts rounding to less than one thousand. |
(a) | Institutional Class Shares of each Fund. |
FAIR VALUE MEASUREMENTS
The following is a summary of the fair valuations according to the inputs used as of December 31, 2015 in valuing the Fund’s assets and liabilities:
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Investments in Affiliates, at Value | ||||||||||||||||
Mutual Funds | ||||||||||||||||
United States | $ | 61,248 | $ | 0 | $ | 0 | $ | 61,248 | ||||||||
Totals | $ | 61,248 | $ | 0 | $ | 0 | $ | 61,248 |
There were no significant transfers between Levels 1, 2, or 3 during the period ended December 31, 2015.
40 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
Schedule of Investments PIMCO RAE Fundamental International Fund
December 31, 2015 (Unaudited)
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN SECURITIES 100.0% | ||||||||||||
COMMON STOCKS 98.5% | ||||||||||||
AUSTRALIA 9.0% | ||||||||||||
CONSUMER DISCRETIONARY 0.3% | ||||||||||||
Fairfax Media Ltd. | 146,110 | $ | 97 | |||||||||
Myer Holdings Ltd. | 76,829 | 66 | ||||||||||
Tabcorp Holdings Ltd. | 67,785 | 231 | ||||||||||
Tatts Group Ltd. | 65,533 | 208 | ||||||||||
|
| |||||||||||
602 | ||||||||||||
|
| |||||||||||
CONSUMER STAPLES 0.9% | ||||||||||||
Coca-Cola Amatil Ltd. | 30,150 | 203 | ||||||||||
Metcash Ltd. | 166,829 | 195 | ||||||||||
Wesfarmers Ltd. | 25,162 | 759 | ||||||||||
Woolworths Ltd. | 33,545 | 595 | ||||||||||
|
| |||||||||||
1,752 | ||||||||||||
|
| |||||||||||
ENERGY 0.3% | ||||||||||||
Caltex Australia Ltd. | 1,156 | 32 | ||||||||||
Santos Ltd. | 96,992 | 258 | ||||||||||
Woodside Petroleum Ltd. | 17,666 | 368 | ||||||||||
|
| |||||||||||
658 | ||||||||||||
|
| |||||||||||
FINANCIALS 4.4% | ||||||||||||
AMP Ltd. | 162,342 | 684 | ||||||||||
Australia & New Zealand Banking Group Ltd. | 69,313 | 1,399 | ||||||||||
Bendigo & Adelaide Bank Ltd. | 22,229 | 192 | ||||||||||
Commonwealth Bank of Australia | 25,341 | 1,567 | ||||||||||
Insurance Australia Group Ltd. | 30,472 | 122 | ||||||||||
Lend Lease Group | 3,164 | 33 | ||||||||||
Macquarie Group Ltd. | 5,435 | 325 | ||||||||||
National Australia Bank Ltd. | 68,730 | 1,500 | ||||||||||
QBE Insurance Group Ltd. | 51,654 | 470 | ||||||||||
Suncorp Group Ltd. | 90,675 | 796 | ||||||||||
Westpac Banking Corp. | 74,928 | 1,816 | ||||||||||
|
| |||||||||||
8,904 | ||||||||||||
|
| |||||||||||
HEALTH CARE 0.3% | ||||||||||||
CSL Ltd. | 4,833 | 368 | ||||||||||
Primary Health Care Ltd. | 51,996 | 88 | ||||||||||
Ramsay Health Care Ltd. | 398 | 20 | ||||||||||
Sonic Healthcare Ltd. | 7,148 | 92 | ||||||||||
|
| |||||||||||
568 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 0.7% | ||||||||||||
ALS Ltd. | 4,546 | 12 | ||||||||||
Asciano Ltd. | 23,416 | 149 | ||||||||||
Aurizon Holdings Ltd. | 30,053 | 95 | ||||||||||
Brambles Ltd. | 8,198 | 69 | ||||||||||
CIMIC Group Ltd. | 7,972 | 140 | ||||||||||
Downer EDI Ltd. | 48,657 | 127 | ||||||||||
Qantas Airways Ltd. | 175,298 | 520 | ||||||||||
Transpacific Industries Group Ltd. | 115,495 | 66 | ||||||||||
Transurban Group | 6,640 | 50 | ||||||||||
UGL Ltd. (a) | 17,358 | 30 |
SHARES | MARKET VALUE (000S) | |||||||||||
WorleyParsons Ltd. | 33,872 | $ | 114 | |||||||||
|
| |||||||||||
1,372 | ||||||||||||
|
| |||||||||||
MATERIALS 1.7% | ||||||||||||
Amcor Ltd. | 9,288 | 90 | ||||||||||
BHP Billiton Ltd. | 112,149 | 1,443 | ||||||||||
BHP Billiton PLC | 60,857 | 679 | ||||||||||
BlueScope Steel Ltd. | 17,685 | 56 | ||||||||||
Boral Ltd. | 19,454 | 83 | ||||||||||
CSR Ltd. | 51,971 | 108 | ||||||||||
Fortescue Metals Group Ltd. | 94,183 | 127 | ||||||||||
Iluka Resources Ltd. | 11,937 | 53 | ||||||||||
Incitec Pivot Ltd. | 79,630 | 228 | ||||||||||
Newcrest Mining Ltd. | 14,436 | 137 | ||||||||||
Orica Ltd. | 26,705 | 299 | ||||||||||
OZ Minerals Ltd. | 47,959 | 140 | ||||||||||
|
| |||||||||||
3,443 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 0.2% | ||||||||||||
Telstra Corp. Ltd. | 120,798 | 491 | ||||||||||
|
| |||||||||||
UTILITIES 0.2% | ||||||||||||
AGL Energy Ltd. | 8,628 | 113 | ||||||||||
DUET Group | 37,705 | 63 | ||||||||||
Origin Energy Ltd. | 53,638 | 181 | ||||||||||
|
| |||||||||||
357 | ||||||||||||
|
| |||||||||||
Total Australia | 18,147 | |||||||||||
|
| |||||||||||
AUSTRIA 0.7% | ||||||||||||
ENERGY 0.2% | ||||||||||||
OMV AG | 15,686 | 445 | ||||||||||
|
| |||||||||||
FINANCIALS 0.4% | ||||||||||||
Erste Group Bank AG | 14,798 | 463 | ||||||||||
Raiffeisen Bank International AG | 18,391 | 270 | ||||||||||
|
| |||||||||||
733 | ||||||||||||
|
| |||||||||||
MATERIALS 0.1% | ||||||||||||
voestalpine AG | 3,428 | 105 | ||||||||||
Wienerberger AG | 3,650 | 67 | ||||||||||
|
| |||||||||||
172 | ||||||||||||
|
| |||||||||||
UTILITIES 0.0% | ||||||||||||
Verbund AG | 2,082 | 27 | ||||||||||
|
| |||||||||||
Total Austria | 1,377 | |||||||||||
|
| |||||||||||
BELGIUM 1.0% | ||||||||||||
CONSUMER STAPLES 0.6% | ||||||||||||
Anheuser-Busch InBev NV | 4,654 | 579 | ||||||||||
Delhaize Group | 5,498 | 535 | ||||||||||
|
| |||||||||||
1,114 | ||||||||||||
|
| |||||||||||
FINANCIALS 0.2% | ||||||||||||
Ageas | 8,125 | 377 | ||||||||||
KBC Groep NV | 2,004 | 125 | ||||||||||
|
| |||||||||||
502 | ||||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
MATERIALS 0.1% | ||||||||||||
Solvay S.A. | 647 | $ | 69 | |||||||||
Umicore S.A. | 1,084 | 46 | ||||||||||
|
| |||||||||||
115 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 0.1% | ||||||||||||
Proximus | 7,953 | 259 | ||||||||||
|
| |||||||||||
Total Belgium | 1,990 | |||||||||||
|
| |||||||||||
CANADA 8.2% | ||||||||||||
CONSUMER DISCRETIONARY 0.2% | ||||||||||||
Canadian Tire Corp. Ltd. ‘A’ | 1,010 | 86 | ||||||||||
Magna International, Inc. | 3,619 | 147 | ||||||||||
Quebecor, Inc. ‘B’ | 6,356 | 155 | ||||||||||
Shaw Communications, Inc. ‘B’ | 2,784 | 48 | ||||||||||
|
| |||||||||||
436 | ||||||||||||
|
| |||||||||||
CONSUMER STAPLES 0.2% | ||||||||||||
George Weston Ltd. | 3,013 | 233 | ||||||||||
Loblaw Cos. Ltd. | 1,352 | 64 | ||||||||||
Metro, Inc. | 1,857 | 52 | ||||||||||
|
| |||||||||||
349 | ||||||||||||
|
| |||||||||||
ENERGY 1.9% | ||||||||||||
Baytex Energy Corp. | 35,215 | 114 | ||||||||||
Bonavista Energy Corp. | 37,299 | 49 | ||||||||||
Canadian Natural Resources Ltd. | 9,410 | 205 | ||||||||||
Canadian Oil Sands Ltd. | 88,491 | 529 | ||||||||||
Cenovus Energy, Inc. | 43,676 | 552 | ||||||||||
Crescent Point Energy Corp. | 10,949 | 128 | ||||||||||
Encana Corp. | 43,332 | 220 | ||||||||||
Enerplus Corp. | 50,731 | 173 | ||||||||||
Husky Energy, Inc. | 18,639 | 193 | ||||||||||
Pengrowth Energy Corp. | 87,876 | 64 | ||||||||||
Penn West Petroleum Ltd. | 146,496 | 124 | ||||||||||
Precision Drilling Corp. | 23,449 | 93 | ||||||||||
ShawCor Ltd. | 1,511 | 31 | ||||||||||
Suncor Energy, Inc. | 46,489 | 1,200 | ||||||||||
TransCanada Corp. | 7,429 | 243 | ||||||||||
|
| |||||||||||
3,918 | ||||||||||||
|
| |||||||||||
FINANCIALS 3.4% | ||||||||||||
Bank of Montreal | 14,580 | 823 | ||||||||||
Bank of Nova Scotia | 18,611 | 753 | ||||||||||
Brookfield Asset Management, Inc. ‘A’ | 10,641 | 336 | ||||||||||
Canadian Imperial Bank of Commerce (b) | 10,426 | 687 | ||||||||||
Great-West Lifeco, Inc. (b) | 8,643 | 216 | ||||||||||
IGM Financial, Inc. | 3,140 | 80 | ||||||||||
Intact Financial Corp. | 1,402 | 90 | ||||||||||
Manulife Financial Corp. | 45,831 | 687 | ||||||||||
National Bank of Canada | 9,278 | 270 | ||||||||||
Onex Corp. | 2,721 | 167 | ||||||||||
Power Corp. of Canada | 18,379 | 384 | ||||||||||
Power Financial Corp. | 4,592 | 105 |
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 41 |
Table of Contents
Schedule of Investments PIMCO RAE Fundamental International Fund (Cont.)
SHARES | MARKET VALUE (000S) | |||||||||||
Royal Bank of Canada | 17,052 | $ | 914 | |||||||||
Sun Life Financial, Inc. | 16,143 | 503 | ||||||||||
Toronto-Dominion Bank | 22,057 | 865 | ||||||||||
|
| |||||||||||
6,880 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 0.6% | ||||||||||||
Air Canada (a) | 48,091 | 355 | ||||||||||
Bombardier, Inc. ‘B’ | 185,423 | 179 | ||||||||||
Canadian National Railway Co. | 8,474 | 474 | ||||||||||
Canadian Pacific Railway Ltd. | 979 | 125 | ||||||||||
Finning International, Inc. | 5,038 | 68 | ||||||||||
WestJet Airlines Ltd. | 1,938 | 28 | ||||||||||
|
| |||||||||||
1,229 | ||||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 0.2% | ||||||||||||
BlackBerry Ltd. (a) | 49,171 | 456 | ||||||||||
|
| |||||||||||
MATERIALS 1.0% | ||||||||||||
Agrium, Inc. | 2,994 | 268 | ||||||||||
Barrick Gold Corp. | 50,978 | 376 | ||||||||||
Domtar Corp. | 8,105 | 299 | ||||||||||
Goldcorp, Inc. | 4,893 | 57 | ||||||||||
IAMGOLD Corp. (a) | 45,120 | 64 | ||||||||||
Kinross Gold Corp. (a) | 93,836 | 171 | ||||||||||
Potash Corp. of Saskatchewan, Inc. | 10,297 | 176 | ||||||||||
Teck Resources Ltd. ‘B’ | 72,284 | 279 | ||||||||||
Yamana Gold, Inc. | 122,474 | 228 | ||||||||||
|
| |||||||||||
1,918 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 0.5% | ||||||||||||
BCE, Inc. | 4,846 | 187 | ||||||||||
Manitoba Telecom Services, Inc. | 8,134 | 175 | ||||||||||
Rogers Communications, Inc. ‘B’ | 16,556 | 571 | ||||||||||
TELUS Corp. | 5,875 | 163 | ||||||||||
|
| |||||||||||
1,096 | ||||||||||||
|
| |||||||||||
UTILITIES 0.2% | ||||||||||||
Atco Ltd. ‘I’ | 4,095 | 106 | ||||||||||
Capital Power Corp. | 3,830 | 49 | ||||||||||
Fortis, Inc. | 2,829 | 77 | ||||||||||
TransAlta Corp. | 35,068 | 124 | ||||||||||
|
| |||||||||||
356 | ||||||||||||
|
| |||||||||||
Total Canada | 16,638 | |||||||||||
|
| |||||||||||
CHILE 0.1% | ||||||||||||
MATERIALS 0.1% | ||||||||||||
Antofagasta PLC | 14,980 | 103 | ||||||||||
|
| |||||||||||
Total Chile | 103 | |||||||||||
|
| |||||||||||
CHINA 0.0% | ||||||||||||
CONSUMER DISCRETIONARY 0.0% | ||||||||||||
Belle International Holdings Ltd. | 33,000 | 25 | ||||||||||
|
| |||||||||||
Total China | 25 | |||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
COLOMBIA 0.0% | ||||||||||||
ENERGY 0.0% | ||||||||||||
Pacific Exploration and Production Corp. | 79,200 | $ | 98 | |||||||||
|
| |||||||||||
Total Colombia | 98 | |||||||||||
|
| |||||||||||
DENMARK 1.4% | ||||||||||||
CONSUMER DISCRETIONARY 0.0% | ||||||||||||
Pandora A/S | 242 | 30 | ||||||||||
|
| |||||||||||
CONSUMER STAPLES 0.2% | ||||||||||||
Carlsberg A/S ‘B’ | 3,257 | 289 | ||||||||||
|
| |||||||||||
FINANCIALS 0.1% | ||||||||||||
Danske Bank A/S | 6,147 | 165 | ||||||||||
Sydbank A/S | 2,404 | 77 | ||||||||||
|
| |||||||||||
242 | ||||||||||||
|
| |||||||||||
HEALTH CARE 0.5% | ||||||||||||
Coloplast A/S ‘B’ | 447 | 36 | ||||||||||
Novo Nordisk A/S ‘B’ | 16,263 | 942 | ||||||||||
|
| |||||||||||
978 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 0.4% | ||||||||||||
AP Moeller - Maersk A/S ‘B’ | 345 | 450 | ||||||||||
FLSmidth & Co. A/S | 1,371 | 48 | ||||||||||
ISS A/S | 8,557 | 308 | ||||||||||
|
| |||||||||||
806 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 0.2% | ||||||||||||
TDC A/S | 80,565 | 401 | ||||||||||
|
| |||||||||||
Total Denmark | 2,746 | |||||||||||
|
| |||||||||||
FINLAND 0.5% | ||||||||||||
CONSUMER DISCRETIONARY 0.0% | ||||||||||||
Nokian Renkaat OYJ | 828 | 30 | ||||||||||
|
| |||||||||||
CONSUMER STAPLES 0.0% | ||||||||||||
Kesko OYJ ‘B’ | 2,219 | 78 | ||||||||||
|
| |||||||||||
ENERGY 0.1% | ||||||||||||
Neste OYJ | 2,890 | 86 | ||||||||||
|
| |||||||||||
HEALTH CARE 0.0% | ||||||||||||
Orion OYJ ‘B’ | 1,075 | 37 | ||||||||||
|
| |||||||||||
INDUSTRIALS 0.0% | ||||||||||||
Metso OYJ | 1,208 | 27 | ||||||||||
YIT OYJ | 5,301 | 30 | ||||||||||
|
| |||||||||||
57 | ||||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 0.1% | ||||||||||||
Nokia OYJ | 10,206 | 72 | ||||||||||
Tieto OYJ | 4,583 | 123 | ||||||||||
|
| |||||||||||
195 | ||||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
MATERIALS 0.2% | ||||||||||||
Stora Enso OYJ ‘R’ | 21,429 | $ | 194 | |||||||||
UPM-Kymmene OYJ | 11,047 | 205 | ||||||||||
|
| |||||||||||
399 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 0.0% | ||||||||||||
Elisa OYJ | 1,148 | 43 | ||||||||||
|
| |||||||||||
UTILITIES 0.1% | ||||||||||||
Fortum OYJ | 7,784 | 117 | ||||||||||
|
| |||||||||||
Total Finland | 1,042 | |||||||||||
|
| |||||||||||
FRANCE 11.4% | ||||||||||||
CONSUMER DISCRETIONARY 1.4% | ||||||||||||
Accor S.A. | 1,774 | 77 | ||||||||||
Christian Dior SE | 822 | 139 | ||||||||||
Cie Generale des Etablissements Michelin | 3,484 | 331 | ||||||||||
Kering | 635 | 108 | ||||||||||
Lagardere S.C.A. | 6,624 | 198 | ||||||||||
LVMH Moet Hennessy Louis Vuitton SE | 2,660 | 418 | ||||||||||
Peugeot S.A. (a) | 8,492 | 149 | ||||||||||
Publicis Groupe S.A. | 1,248 | 83 | ||||||||||
Renault S.A. | 3,664 | 367 | ||||||||||
Solocal Group (a) | 5,089 | 38 | ||||||||||
Valeo S.A. | 855 | 132 | ||||||||||
Vivendi S.A. | 39,567 | 850 | ||||||||||
|
| |||||||||||
2,890 | ||||||||||||
|
| |||||||||||
CONSUMER STAPLES 0.7% | ||||||||||||
Carrefour S.A. | 13,282 | 383 | ||||||||||
Casino Guichard Perrachon S.A. | 4,587 | 211 | ||||||||||
Danone S.A. | 4,229 | 286 | ||||||||||
L’Oreal S.A. | 1,332 | 224 | ||||||||||
Pernod-Ricard S.A. | 1,566 | 179 | ||||||||||
Rallye S.A. | 873 | 13 | ||||||||||
Wendel S.A. | 537 | 64 | ||||||||||
|
| |||||||||||
1,360 | ||||||||||||
|
| |||||||||||
ENERGY 1.7% | ||||||||||||
CGG S.A. (a) | 58,169 | 170 | ||||||||||
Technip S.A. | 1,427 | 71 | ||||||||||
Total S.A. | 68,855 | 3,087 | ||||||||||
Vallourec S.A. | 10,022 | 93 | ||||||||||
|
| |||||||||||
3,421 | ||||||||||||
|
| |||||||||||
FINANCIALS 1.9% | ||||||||||||
AXA S.A. | 39,862 | 1,089 | ||||||||||
BNP Paribas S.A. | 30,461 | 1,723 | ||||||||||
CNP Assurances | 6,922 | 93 | ||||||||||
Credit Agricole S.A. | 20,872 | 246 | ||||||||||
Natixis S.A. | 7,675 | 44 | ||||||||||
SCOR SE | 3,878 | 145 | ||||||||||
Societe Generale S.A. | 10,865 | 501 | ||||||||||
|
| |||||||||||
3,841 | ||||||||||||
|
|
42 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
SHARES | MARKET VALUE (000S) | |||||||||||
HEALTH CARE 0.7% | ||||||||||||
Essilor International S.A. | 1,021 | $ | 127 | |||||||||
Sanofi | 14,243 | 1,214 | ||||||||||
|
| |||||||||||
1,341 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 1.8% | ||||||||||||
Air France-KLM (a) | 72,705 | 553 | ||||||||||
Airbus Group SE | 4,279 | 288 | ||||||||||
Alstom S.A. | 7,326 | 224 | ||||||||||
Bouygues S.A. | 10,888 | 432 | ||||||||||
Cie de Saint-Gobain | 10,650 | 461 | ||||||||||
Eiffage S.A. | 4,560 | 295 | ||||||||||
Rexel S.A. | 20,328 | 271 | ||||||||||
Safran S.A. | 2,774 | 191 | ||||||||||
Schneider Electric SE | 2,926 | 166 | ||||||||||
Societe BIC S.A. | 183 | 30 | ||||||||||
Teleperformance S.E. | 998 | 84 | ||||||||||
Thales S.A. | 840 | 63 | ||||||||||
Vinci S.A. | 10,308 | 661 | ||||||||||
|
| |||||||||||
3,719 | ||||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 0.3% | ||||||||||||
Alcatel-Lucent (a) | 12,399 | 49 | ||||||||||
Atos SE | 1,825 | 153 | ||||||||||
Cap Gemini S.A. | 1,408 | 131 | ||||||||||
Dassault Systemes | 371 | 30 | ||||||||||
Neopost S.A. | 3,043 | 74 | ||||||||||
UBISOFT Entertainment (a) | 4,438 | 128 | ||||||||||
|
| |||||||||||
565 | ||||||||||||
|
| |||||||||||
MATERIALS 0.2% | ||||||||||||
Air Liquide S.A. | 2,626 | 295 | ||||||||||
Arkema S.A. | 1,107 | 77 | ||||||||||
|
| |||||||||||
372 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 1.3% | ||||||||||||
Orange S.A. | 160,680 | 2,688 | ||||||||||
|
| |||||||||||
UTILITIES 1.4% | ||||||||||||
Electricite de France S.A. | 13,311 | 196 | ||||||||||
Engie S.A. | 109,432 | 1,938 | ||||||||||
Suez Environnement Co. | 14,414 | 270 | ||||||||||
Veolia Environnement S.A. | 21,147 | 502 | ||||||||||
|
| |||||||||||
2,906 | ||||||||||||
|
| |||||||||||
Total France | 23,103 | |||||||||||
|
| |||||||||||
GERMANY 9.6% | ||||||||||||
CONSUMER DISCRETIONARY 1.4% | ||||||||||||
adidas AG | 3,188 | 310 | ||||||||||
Bayerische Motoren Werke AG | 7,436 | 783 | ||||||||||
Continental AG | 933 | 226 | ||||||||||
Daimler AG | 14,425 | 1,205 | ||||||||||
ProSiebenSat.1 Media SE | 4,739 | 239 | ||||||||||
|
| |||||||||||
2,763 | ||||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
CONSUMER STAPLES 0.5% | ||||||||||||
METRO AG | 23,813 | $ | 759 | |||||||||
Suedzucker AG | 10,948 | 217 | ||||||||||
|
| |||||||||||
976 | ||||||||||||
|
| |||||||||||
FINANCIALS 1.5% | ||||||||||||
Commerzbank AG (a) | 46,445 | 479 | ||||||||||
Deutsche Bank AG | 47,625 | 1,157 | ||||||||||
Deutsche Boerse AG | 2,509 | 221 | ||||||||||
Hannover Rueck SE | 1,981 | 226 | ||||||||||
Muenchener Rueckversicherungs-Gesellschaft AG in Muenchen | 4,939 | 984 | ||||||||||
|
| |||||||||||
3,067 | ||||||||||||
|
| |||||||||||
HEALTH CARE 1.0% | ||||||||||||
Bayer AG | 7,724 | 965 | ||||||||||
Fresenius Medical Care AG & Co. KGaA | 2,606 | 219 | ||||||||||
Fresenius SE & Co. KGaA | 6,241 | 445 | ||||||||||
Merck KGaA | 1,498 | 145 | ||||||||||
Rhoen Klinikum AG | 5,548 | 166 | ||||||||||
STADA Arzneimittel AG | 2,087 | 84 | ||||||||||
|
| |||||||||||
2,024 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 1.8% | ||||||||||||
Bilfinger SE | 4,714 | 221 | ||||||||||
Brenntag AG | 2,247 | 117 | ||||||||||
Deutsche Lufthansa AG | 65,740 | 1,035 | ||||||||||
Deutsche Post AG | 24,281 | 679 | ||||||||||
Fraport AG Frankfurt Airport Services Worldwide | 1,543 | 98 | ||||||||||
GEA Group AG | 1,600 | 65 | ||||||||||
HOCHTIEF AG | 4,225 | 392 | ||||||||||
OSRAM Licht AG | 2,032 | 85 | ||||||||||
Rheinmetall AG | 3,202 | 213 | ||||||||||
Siemens AG | 8,192 | 793 | ||||||||||
|
| |||||||||||
3,698 | ||||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 0.3% | ||||||||||||
Infineon Technologies AG | 2,433 | 35 | ||||||||||
SAP SE | 8,001 | 635 | ||||||||||
|
| |||||||||||
670 | ||||||||||||
|
| |||||||||||
MATERIALS 1.3% | ||||||||||||
Aurubis AG | 2,223 | 113 | ||||||||||
BASF SE | 12,491 | 952 | ||||||||||
Evonik Industries AG | 3,523 | 116 | ||||||||||
HeidelbergCement AG | 5,242 | 427 | ||||||||||
K+S AG | 9,534 | 243 | ||||||||||
LANXESS AG | 3,088 | 142 | ||||||||||
Linde AG | 1,930 | 279 | ||||||||||
Salzgitter AG | 5,788 | 141 | ||||||||||
Symrise AG | 1,792 | 119 | ||||||||||
ThyssenKrupp AG | 3,607 | 71 | ||||||||||
|
| |||||||||||
2,603 | ||||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
TELECOMMUNICATION SERVICES 0.9% | ||||||||||||
Deutsche Telekom AG | 95,296 | $ | 1,712 | |||||||||
Freenet AG | 2,027 | 68 | ||||||||||
|
| |||||||||||
1,780 | ||||||||||||
|
| |||||||||||
UTILITIES 0.9% | ||||||||||||
E.ON SE | 79,417 | 762 | ||||||||||
RWE AG | 75,322 | 950 | ||||||||||
|
| |||||||||||
1,712 | ||||||||||||
|
| |||||||||||
Total Germany | 19,293 | |||||||||||
|
| |||||||||||
HONG KONG 1.8% | ||||||||||||
CONSUMER DISCRETIONARY 0.2% | ||||||||||||
Esprit Holdings Ltd. | 83,014 | 91 | ||||||||||
Li & Fung Ltd. | 106,000 | 72 | ||||||||||
SJM Holdings Ltd. | 150,000 | 107 | ||||||||||
Yue Yuen Industrial Holdings Ltd. | 12,000 | 40 | ||||||||||
|
| |||||||||||
310 | ||||||||||||
|
| |||||||||||
CONSUMER STAPLES 0.2% | ||||||||||||
Swire Pacific Ltd. ‘A’ | 26,000 | 292 | ||||||||||
Wharf Holdings Ltd. | 22,000 | 122 | ||||||||||
|
| |||||||||||
414 | ||||||||||||
|
| |||||||||||
FINANCIALS 1.1% | ||||||||||||
AIA Group Ltd. | 105,200 | 629 | ||||||||||
Bank of East Asia Ltd. | 11,800 | 44 | ||||||||||
First Pacific Co. Ltd. | 36,000 | 24 | ||||||||||
Hang Lung Properties Ltd. | 18,000 | 41 | ||||||||||
Hang Seng Bank Ltd. | 10,500 | 200 | ||||||||||
Henderson Land Development Co. Ltd. | 4,400 | 27 | ||||||||||
Hong Kong Exchanges and Clearing Ltd. | 9,900 | 252 | ||||||||||
Hongkong Land Holdings Ltd. | 23,400 | 163 | ||||||||||
Hysan Development Co. Ltd. | 14,000 | 57 | ||||||||||
Kerry Properties Ltd. | 25,000 | 68 | ||||||||||
New World Development Co. Ltd. | 226,000 | 222 | ||||||||||
Shimao Property Holdings Ltd. | 79,500 | 140 | ||||||||||
Sun Hung Kai Properties Ltd. | 18,000 | 217 | ||||||||||
Swire Properties Ltd. | 12,800 | 37 | ||||||||||
Wheelock & Co. Ltd. | 23,000 | 97 | ||||||||||
|
| |||||||||||
2,218 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 0.2% | ||||||||||||
Cathay Pacific Airways Ltd. | 44,000 | 76 | ||||||||||
CK Hutchison Holdings Ltd. | 11,543 | 155 | ||||||||||
Jardine Matheson Holdings Ltd. | 1,400 | 68 | ||||||||||
MTR Corp. Ltd. | 22,500 | 111 | ||||||||||
Noble Group Ltd. | 105,600 | 29 | ||||||||||
|
| |||||||||||
439 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 0.0% | ||||||||||||
PCCW Ltd. | 121,000 | 71 | ||||||||||
|
|
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 43 |
Table of Contents
Schedule of Investments PIMCO RAE Fundamental International Fund (Cont.)
SHARES | MARKET VALUE (000S) | |||||||||||
UTILITIES 0.1% | ||||||||||||
CLP Holdings Ltd. | 28,500 | $ | 242 | |||||||||
|
| |||||||||||
Total Hong Kong | 3,694 | |||||||||||
|
| |||||||||||
IRELAND 1.0% | ||||||||||||
HEALTH CARE 0.6% | ||||||||||||
Medtronic PLC | 10,971 | 844 | ||||||||||
Perrigo Co. PLC | 798 | 115 | ||||||||||
Shire PLC | 5,251 | 360 | ||||||||||
|
| |||||||||||
1,319 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 0.1% | ||||||||||||
DCC PLC | 600 | 50 | ||||||||||
Experian PLC | 7,966 | 141 | ||||||||||
|
| |||||||||||
191 | ||||||||||||
|
| |||||||||||
MATERIALS 0.3% | ||||||||||||
CRH PLC | 12,130 | 350 | ||||||||||
Smurfit Kappa Group PLC | 7,178 | 184 | ||||||||||
|
| |||||||||||
534 | ||||||||||||
|
| |||||||||||
Total Ireland | 2,044 | |||||||||||
|
| |||||||||||
ISRAEL 0.9% | ||||||||||||
FINANCIALS 0.2% | ||||||||||||
Bank Hapoalim BM | 26,528 | 137 | ||||||||||
Bank Leumi Le-Israel BM (a) | 52,089 | 181 | ||||||||||
Israel Discount Bank Ltd.‘A’ (a) | 35,472 | 64 | ||||||||||
|
| |||||||||||
382 | ||||||||||||
|
| |||||||||||
HEALTH CARE 0.4% | ||||||||||||
Teva Pharmaceutical Industries Ltd. SP - ADR | 13,539 | 889 | ||||||||||
|
| |||||||||||
MATERIALS 0.1% | ||||||||||||
Israel Chemicals Ltd. | 32,161 | 130 | ||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 0.2% | ||||||||||||
Bezeq The Israeli Telecommunication Corp. Ltd. | 168,503 | 371 | ||||||||||
|
| |||||||||||
Total Israel | 1,772 | |||||||||||
|
| |||||||||||
ITALY 3.1% | ||||||||||||
CONSUMER DISCRETIONARY 0.1% | ||||||||||||
Luxottica Group SpA | 447 | 29 | ||||||||||
Mediaset SpA | 21,050 | 87 | ||||||||||
|
| |||||||||||
116 | ||||||||||||
|
| |||||||||||
ENERGY 0.9% | ||||||||||||
Eni SpA | 112,712 | 1,675 | ||||||||||
Saipem SpA | 24,312 | 196 | ||||||||||
|
| |||||||||||
1,871 | ||||||||||||
|
| |||||||||||
FINANCIALS 0.8% | ||||||||||||
Assicurazioni Generali SpA | 10,423 | 191 | ||||||||||
Banca Popolare di Sondrio SCARL | 16,580 | 74 | ||||||||||
Intesa Sanpaolo SpA | 196,091 | 651 |
SHARES | MARKET VALUE (000S) | |||||||||||
UniCredit SpA | 85,030 | $ | 470 | |||||||||
Unione di Banche Italiane SCpA | 21,420 | 143 | ||||||||||
Unipol Gruppo Finanziario SpA | 14,351 | 74 | ||||||||||
|
| |||||||||||
1,603 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 0.0% | ||||||||||||
Prysmian SpA | 3,500 | 77 | ||||||||||
|
| |||||||||||
MATERIALS 0.1% | ||||||||||||
Italcementi SpA | 16,462 | 184 | ||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 0.5% | ||||||||||||
Telecom Italia SpA | 732,474 | 928 | ||||||||||
|
| |||||||||||
UTILITIES 0.7% | ||||||||||||
A2A SpA | 100,720 | 136 | �� | |||||||||
Enel SpA | 297,302 | 1,247 | ||||||||||
Snam SpA | 15,737 | 82 | ||||||||||
|
| |||||||||||
1,465 | ||||||||||||
|
| |||||||||||
Total Italy | 6,244 | |||||||||||
|
| |||||||||||
JAPAN 14.3% | ||||||||||||
CONSUMER DISCRETIONARY 1.8% | ||||||||||||
Aisin Seiki Co. Ltd. | 1,100 | 47 | ||||||||||
Aoyama Trading Co. Ltd. | 1,000 | 38 | ||||||||||
Bridgestone Corp. | 2,000 | 69 | ||||||||||
Daihatsu Motor Co. Ltd. | 8,200 | 111 | ||||||||||
Fuji Heavy Industries Ltd. | 1,600 | 66 | ||||||||||
Fuji Media Holdings, Inc. | 2,500 | 29 | ||||||||||
Honda Motor Co. Ltd. | 20,900 | 668 | ||||||||||
Isetan Mitsukoshi Holdings Ltd. | 3,600 | 47 | ||||||||||
Nikon Corp. | 7,900 | 106 | ||||||||||
Nissan Motor Co. Ltd. | 45,600 | 477 | ||||||||||
Nitori Holdings Co. Ltd. | 400 | 34 | ||||||||||
Oriental Land Co. Ltd. | 1,100 | 67 | ||||||||||
Panasonic Corp. | 11,700 | 119 | ||||||||||
Sankyo Co. Ltd. | 700 | 26 | ||||||||||
Sekisui Chemical Co. Ltd. | 6,000 | 78 | ||||||||||
Sekisui House Ltd. | 2,600 | 44 | ||||||||||
Skylark Co. Ltd. | 4,400 | 57 | ||||||||||
Sony Corp. | 28,900 | 710 | ||||||||||
Sumitomo Electric Industries Ltd. | 3,900 | 55 | ||||||||||
Sumitomo Forestry Co. Ltd. | 5,300 | 71 | ||||||||||
Sumitomo Rubber Industries Ltd. | 5,200 | 68 | ||||||||||
Suzuki Motor Corp. | 1,900 | 58 | ||||||||||
Takashimaya Co. Ltd. | 4,000 | 36 | ||||||||||
Toyota Motor Corp. | 7,435 | 458 | ||||||||||
Yamada Denki Co. Ltd. | 10,500 | 45 | ||||||||||
Yamaha Corp. | 1,700 | 41 | ||||||||||
Yamaha Motor Co. Ltd. | 1,600 | 36 | ||||||||||
|
| |||||||||||
3,661 | ||||||||||||
|
| |||||||||||
CONSUMER STAPLES 1.3% | ||||||||||||
Aeon Co. Ltd. | 36,947 | 569 | ||||||||||
Ajinomoto Co., Inc. | 5,000 | 118 | ||||||||||
Asahi Group Holdings Ltd. | 1,700 | 53 |
SHARES | MARKET VALUE (000S) | |||||||||||
Japan Tobacco, Inc. | 2,756 | $ | 101 | |||||||||
Kao Corp. | 1,100 | 57 | ||||||||||
Kirin Holdings Co. Ltd. | 32,900 | 447 | ||||||||||
MEIJI Holdings Co. Ltd. | 3,400 | 281 | ||||||||||
Morinaga Milk Industry Co. Ltd. | 20,000 | 91 | ||||||||||
NH Foods Ltd. | 4,000 | 78 | ||||||||||
Nisshin Seifun Group, Inc. | 4,200 | 69 | ||||||||||
Sapporo Holdings Ltd. | 7,000 | 31 | ||||||||||
Seven & Holdings Co. Ltd. | 1,500 | 69 | ||||||||||
Shiseido Co. Ltd. | 6,300 | 131 | ||||||||||
Suntory Beverage & Food Ltd. | 800 | 35 | ||||||||||
UNY Group Holdings Co. Ltd. | 28,000 | 176 | ||||||||||
Yamazaki Baking Co. Ltd. | 11,000 | 247 | ||||||||||
|
| |||||||||||
2,553 | ||||||||||||
|
| |||||||||||
ENERGY 0.5% | ||||||||||||
Idemitsu Kosan Co. Ltd. | 7,700 | 123 | ||||||||||
Inpex Corp. | 37,800 | 369 | ||||||||||
JX Holdings, Inc. | 100,200 | 421 | ||||||||||
Showa Shell Sekiyu KK | 4,200 | 34 | ||||||||||
TonenGeneral Sekiyu KK | 1,000 | 8 | ||||||||||
|
| |||||||||||
955 | ||||||||||||
|
| |||||||||||
FINANCIALS 2.8% | ||||||||||||
77 Bank Ltd. | 10,000 | 54 | ||||||||||
Aozora Bank Ltd. | 17,000 | 59 | ||||||||||
Bank of Yokohama Ltd. | 15,000 | 92 | ||||||||||
Chiba Bank Ltd. | 6,000 | 42 | ||||||||||
Chugoku Bank Ltd. | 3,800 | 51 | ||||||||||
Dai-ichi Life Insurance Co. Ltd. | 29,800 | 496 | ||||||||||
Daito Trust Construction Co. Ltd. | 200 | 23 | ||||||||||
Daiwa House Industry Co. Ltd. | 2,500 | 72 | ||||||||||
Fukuoka Financial Group, Inc. | 26,000 | 129 | ||||||||||
Gunma Bank Ltd. | 12,000 | 70 | ||||||||||
Hachijuni Bank Ltd. | 10,000 | 61 | ||||||||||
Hokuhoku Financial Group, Inc. | 42,000 | 86 | ||||||||||
Mitsubishi UFJ Financial Group, Inc. | 256,100 | 1,586 | ||||||||||
Mizuho Financial Group, Inc. | 519,600 | 1,039 | ||||||||||
MS&AD Insurance Group Holdings, Inc. | 2,900 | 85 | ||||||||||
Nishi-Nippon City Bank Ltd. | 44,000 | 116 | ||||||||||
North Pacific Bank Ltd. | 8,100 | 28 | ||||||||||
Resona Holdings, Inc. | 51,600 | 251 | ||||||||||
Sompo Japan Nipponkoa Holdings, Inc. | 2,100 | 69 | ||||||||||
Sony Financial Holdings, Inc. | 4,400 | 79 | ||||||||||
Sumitomo Mitsui Financial Group, Inc. | 22,800 | 860 | ||||||||||
T&D Holdings, Inc. | 7,700 | 102 | ||||||||||
Tokio Marine Holdings, Inc. | 2,200 | 85 | ||||||||||
Tokyu Fudosan Holdings Corp. | 4,400 | 27 | ||||||||||
Yamaguchi Financial Group, Inc. | 5,000 | 59 | ||||||||||
|
| |||||||||||
5,621 | ||||||||||||
|
| |||||||||||
HEALTH CARE 0.9% | ||||||||||||
Alfresa Holdings Corp. | 1,500 | 30 | ||||||||||
Astellas Pharma, Inc. | 5,200 | 74 |
44 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
SHARES | MARKET VALUE (000S) | |||||||||||
Daiichi Sankyo Co. Ltd. | 17,116 | $ | 353 | |||||||||
Eisai Co. Ltd. | 5,600 | 371 | ||||||||||
Hoya Corp. | 2,300 | 94 | ||||||||||
Medipal Holdings Corp. | 4,300 | 73 | ||||||||||
Otsuka Holdings Co. Ltd. | 2,628 | 93 | ||||||||||
Shionogi & Co. Ltd. | 3,800 | 172 | ||||||||||
Suzuken Co. Ltd/Aichi Japan | 800 | 30 | ||||||||||
Takeda Pharmaceutical Co. Ltd. | 10,500 | 524 | ||||||||||
|
| |||||||||||
1,814 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 1.8% | ||||||||||||
ANA Holdings, Inc. | 22,000 | 63 | ||||||||||
Central Japan Railway Co. | 1,100 | 195 | ||||||||||
Dai Nippon Printing Co. Ltd. | 21,000 | 208 | ||||||||||
East Japan Railway Co. | 1,700 | 160 | ||||||||||
FANUC Corp. | 500 | 86 | ||||||||||
Furukawa Electric Co. Ltd. | 15,000 | 32 | ||||||||||
Hitachi Construction Machinery Co. Ltd. | 1,900 | 30 | ||||||||||
ITOCHU Corp. | 26,300 | 311 | ||||||||||
Japan Airlines Co. Ltd. | 10,700 | 383 | ||||||||||
Komatsu Ltd. | 2,200 | 36 | ||||||||||
Mitsubishi Corp. | 15,100 | 251 | ||||||||||
Mitsui & Co. Ltd. | 39,800 | 473 | ||||||||||
Nippon Yusen KK | 17,000 | 41 | ||||||||||
NTN Corp. | 3,000 | 13 | ||||||||||
Recruit Holdings Co. Ltd. | 1,000 | 29 | ||||||||||
Sojitz Corp. | 83,600 | 175 | ||||||||||
Sumitomo Corp. | 32,800 | 334 | ||||||||||
Sumitomo Heavy Industries Ltd. | 11,000 | 49 | ||||||||||
Toppan Printing Co. Ltd. | 21,000 | 194 | ||||||||||
Toshiba Corp. | 144,000 | 296 | ||||||||||
Toyota Tsusho Corp. | 1,200 | 28 | ||||||||||
West Japan Railway Co. | 5,100 | 353 | ||||||||||
|
| |||||||||||
3,740 | ||||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 1.7% | ||||||||||||
Brother Industries Ltd. | 3,500 | 40 | ||||||||||
Canon, Inc. | 22,250 | 673 | ||||||||||
DeNA Co. Ltd. | 8,900 | 139 | ||||||||||
FUJIFILM Holdings Corp. | 9,400 | 392 | ||||||||||
Fujitsu Ltd. | 48,000 | 240 | ||||||||||
Hitachi Ltd. | 78,000 | 442 | ||||||||||
Japan Display, Inc. (a) | 10,100 | 29 | ||||||||||
Konica Minolta, Inc. | 18,400 | 184 | ||||||||||
Kyocera Corp. | 700 | 33 | ||||||||||
Murata Manufacturing Co. Ltd. | 1,200 | 173 | ||||||||||
NEC Corp. | 73,000 | 231 | ||||||||||
Nintendo Co. Ltd. | 500 | 69 | ||||||||||
Nippon Electric Glass Co. Ltd. | 17,500 | 88 | ||||||||||
NTT Data Corp. | 1,100 | 53 | ||||||||||
Ricoh Co. Ltd. | 41,400 | 426 | ||||||||||
TDK Corp. | 2,200 | 141 | ||||||||||
|
| |||||||||||
3,353 | ||||||||||||
|
| |||||||||||
MATERIALS 1.5% | ||||||||||||
Asahi Glass Co. Ltd. | 83,000 | 476 |
SHARES | MARKET VALUE (000S) | |||||||||||
Asahi Kasei Corp. | 16,000 | $ | 108 | |||||||||
Daicel Corp. | 6,500 | 97 | ||||||||||
Denki Kagaku Kogyo KK | 8,000 | 35 | ||||||||||
DIC Corp. | 33,000 | 89 | ||||||||||
JFE Holdings, Inc. | 2,600 | 41 | ||||||||||
Kaneka Corp. | 6,000 | 62 | ||||||||||
Kobe Steel Ltd. | 64,000 | 70 | ||||||||||
Kuraray Co. Ltd. | 2,400 | 29 | ||||||||||
Mitsubishi Chemical Holdings Corp. | 80,100 | 508 | ||||||||||
Mitsubishi Materials Corp. | 16,000 | 50 | ||||||||||
Mitsui Chemicals, Inc. | 32,000 | 142 | ||||||||||
Nippon Paper Industries Co. Ltd. | 6,418 | 104 | ||||||||||
Nitto Denko Corp. | 1,800 | 131 | ||||||||||
Oji Holdings Corp. | 35,000 | 141 | ||||||||||
Shin-Etsu Chemical Co. Ltd. | 600 | 33 | ||||||||||
Showa Denko KK | 74,000 | 87 | ||||||||||
Sumitomo Chemical Co. Ltd. | 73,000 | 419 | ||||||||||
Teijin Ltd. | 62,000 | 211 | ||||||||||
Tosoh Corp. | 10,000 | 51 | ||||||||||
Toyo Seikan Group Holdings Ltd. | 1,500 | 28 | ||||||||||
Ube Industries Ltd. | 42,000 | 89 | ||||||||||
|
| |||||||||||
3,001 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 1.2% | ||||||||||||
KDDI Corp. | 7,900 | 205 | ||||||||||
Nippon Telegraph & Telephone Corp. | 41,600 | 1,656 | ||||||||||
NTT DOCOMO, Inc. | 32,900 | 675 | ||||||||||
|
| |||||||||||
2,536 | ||||||||||||
|
| |||||||||||
UTILITIES 0.8% | ||||||||||||
Chubu Electric Power Co., Inc. | 37,400 | 512 | ||||||||||
Electric Power Development Co. Ltd. | 3,900 | 139 | ||||||||||
Hokuriku Electric Power Co. | 9,588 | 142 | ||||||||||
Kansai Electric Power Co., Inc. (a) | 26,400 | 316 | ||||||||||
Osaka Gas Co. Ltd. | 5,000 | 18 | ||||||||||
Shikoku Electric Power Co., Inc. | 5,700 | 89 | ||||||||||
Tohoku Electric Power Co., Inc. | 25,900 | 324 | ||||||||||
Tokyo Electric Power Co., Inc. (a) | 9,700 | 56 | ||||||||||
Tokyo Gas Co. Ltd. | 6,000 | 28 | ||||||||||
|
| |||||||||||
1,624 | ||||||||||||
|
| |||||||||||
Total Japan | 28,858 | |||||||||||
|
| |||||||||||
LUXEMBOURG 0.2% | ||||||||||||
CONSUMER DISCRETIONARY 0.1% | ||||||||||||
RTL Group S.A. | 1,046 | 87 | ||||||||||
SES S.A. | 2,974 | 83 | ||||||||||
|
| |||||||||||
170 | ||||||||||||
|
| |||||||||||
MATERIALS 0.1% | ||||||||||||
ArcelorMittal | 76,132 | 321 | ||||||||||
|
| |||||||||||
Total Luxembourg | 491 | |||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
NETHERLANDS 4.5% | ||||||||||||
CONSUMER DISCRETIONARY 0.1% | ||||||||||||
Wolters Kluwer NV | 3,370 | $ | 113 | |||||||||
|
| |||||||||||
CONSUMER STAPLES 0.6% | ||||||||||||
Heineken Holding NV | 3,899 | 300 | ||||||||||
Heineken NV | 2,533 | 216 | ||||||||||
Koninklijke Ahold NV | 36,150 | 763 | ||||||||||
|
| |||||||||||
1,279 | ||||||||||||
|
| |||||||||||
ENERGY 2.1% | ||||||||||||
Fugro NV | 9,088 | 149 | ||||||||||
Royal Dutch Shell PLC ‘A’ | 183,017 | 4,174 | ||||||||||
|
| |||||||||||
4,323 | ||||||||||||
|
| |||||||||||
FINANCIALS 0.9% | ||||||||||||
Aegon NV | 27,415 | 155 | ||||||||||
ING Groep NV - Dutch Certificate | 101,464 | 1,373 | ||||||||||
NN Group NV | 5,317 | 187 | ||||||||||
|
| |||||||||||
1,715 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 0.3% | ||||||||||||
Koninklijke BAM Groep NV | 15,329 | 85 | ||||||||||
Koninklijke Philips NV | 13,247 | 338 | ||||||||||
PostNL NV (a) | 49,558 | 188 | ||||||||||
Randstad Holding NV | 1,030 | 64 | ||||||||||
TNT Express NV | 2,541 | 22 | ||||||||||
|
| |||||||||||
697 | ||||||||||||
|
| |||||||||||
MATERIALS 0.2% | ||||||||||||
Akzo Nobel NV | 3,594 | 240 | ||||||||||
Koninklijke DSM NV | 1,266 | 64 | ||||||||||
|
| |||||||||||
304 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 0.3% | ||||||||||||
Koninklijke KPN NV | 114,070 | 431 | ||||||||||
VimpelCom Ltd. SP - ADR | 37,152 | 122 | ||||||||||
|
| |||||||||||
553 | ||||||||||||
|
| |||||||||||
Total Netherlands | 8,984 | |||||||||||
|
| |||||||||||
NEW ZEALAND 0.2% | ||||||||||||
MATERIALS 0.0% | ||||||||||||
Fletcher Building Ltd. | 15,429 | 77 | ||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 0.2% | ||||||||||||
Spark New Zealand Ltd. | 125,612 | 283 | ||||||||||
|
| |||||||||||
UTILITIES 0.0% | ||||||||||||
Meridian Energy Ltd. | 18,061 | 30 | ||||||||||
|
| |||||||||||
Total New Zealand | 390 | |||||||||||
|
| |||||||||||
NORWAY 1.2% | ||||||||||||
CONSUMER STAPLES 0.1% | ||||||||||||
Marine Harvest ASA | 4,600 | 62 | ||||||||||
Orkla ASA | 12,893 | 101 | ||||||||||
|
| |||||||||||
163 | ||||||||||||
|
|
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 45 |
Table of Contents
Schedule of Investments PIMCO RAE Fundamental International Fund (Cont.)
SHARES | MARKET VALUE (000S) | |||||||||||
ENERGY 0.8% | ||||||||||||
Petroleum Geo-Services ASA | 46,082 | $ | 188 | |||||||||
Statoil ASA | 101,846 | 1,421 | ||||||||||
TGS Nopec Geophysical Co. ASA | 1,510 | 24 | ||||||||||
|
| |||||||||||
1,633 | ||||||||||||
|
| |||||||||||
FINANCIALS 0.1% | ||||||||||||
DNB ASA | 11,369 | 140 | ||||||||||
Gjensidige Forsikring ASA | 3,759 | 60 | ||||||||||
|
| |||||||||||
200 | ||||||||||||
|
| |||||||||||
MATERIALS 0.1% | ||||||||||||
Norsk Hydro ASA | 15,180 | 56 | ||||||||||
Yara International ASA | 5,384 | 232 | ||||||||||
|
| |||||||||||
288 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 0.1% | ||||||||||||
Telenor ASA | 11,753 | 196 | ||||||||||
|
| |||||||||||
Total Norway | 2,480 | |||||||||||
|
| |||||||||||
PORTUGAL 0.2% | ||||||||||||
CONSUMER STAPLES 0.0% | ||||||||||||
Jeronimo Martins SGPS S.A. | 2,149 | 28 | ||||||||||
|
| |||||||||||
FINANCIALS 0.0% | ||||||||||||
Banco Espirito Santo S.A. (a) | 59,573 | 1 | ||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 0.0% | ||||||||||||
Pharol SGPS S.A. (a) | 110,951 | 32 | ||||||||||
|
| |||||||||||
UTILITIES 0.2% | ||||||||||||
EDP - Energias de Portugal S.A. | 117,585 | 424 | ||||||||||
|
| |||||||||||
Total Portugal | 485 | |||||||||||
|
| |||||||||||
SINGAPORE 1.1% | ||||||||||||
CONSUMER DISCRETIONARY 0.1% | ||||||||||||
Jardine Cycle & Carriage Ltd. | 4,200 | 103 | ||||||||||
Singapore Press Holdings Ltd. | 30,100 | 83 | ||||||||||
|
| |||||||||||
186 | ||||||||||||
|
| |||||||||||
FINANCIALS 0.5% | ||||||||||||
CapitaLand Ltd. | 43,400 | 102 | ||||||||||
City Developments Ltd. | 5,900 | 32 | ||||||||||
DBS Group Holdings Ltd. | 29,610 | 347 | ||||||||||
Oversea-Chinese Banking Corp. Ltd. | 37,300 | 231 | ||||||||||
United Overseas Bank Ltd. | 15,800 | 218 | ||||||||||
UOL Group Ltd. | 6,900 | 30 | ||||||||||
|
| |||||||||||
960 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 0.3% | ||||||||||||
ComfortDelGro Corp. Ltd. | 35,600 | 76 | ||||||||||
Hutchison Port Holdings Trust | 283,400 | 150 | ||||||||||
Keppel Corp. Ltd. | 17,700 | 81 | ||||||||||
Singapore Airlines Ltd. | 37,367 | 294 | ||||||||||
|
| |||||||||||
601 | ||||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
INFORMATION TECHNOLOGY 0.1% | ||||||||||||
Avago Technologies Ltd. | 1,523 | $ | 221 | |||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 0.1% | ||||||||||||
Singapore Telecommunications Ltd. | 112,600 | 290 | ||||||||||
|
| |||||||||||
Total Singapore | 2,258 | |||||||||||
|
| |||||||||||
SOUTH AFRICA 0.1% | ||||||||||||
FINANCIALS 0.0% | ||||||||||||
Investec PLC | 8,785 | 62 | ||||||||||
|
| |||||||||||
MATERIALS 0.1% | ||||||||||||
Mondi PLC | 6,306 | 124 | ||||||||||
|
| |||||||||||
Total South Africa | 186 | |||||||||||
|
| |||||||||||
SPAIN 3.4% | ||||||||||||
CONSUMER DISCRETIONARY 0.2% | ||||||||||||
Inditex S.A. | 9,614 | 330 | ||||||||||
|
| |||||||||||
ENERGY 0.1% | ||||||||||||
Repsol S.A. | 26,188 | 288 | ||||||||||
|
| |||||||||||
FINANCIALS 1.2% | ||||||||||||
Banco Bilbao Vizcaya Argentaria S.A. | 64,311 | 470 | ||||||||||
Banco Santander S.A. | 397,519 | 1,955 | ||||||||||
Mapfre S.A. | 44,708 | 112 | ||||||||||
|
| |||||||||||
2,537 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 0.4% | ||||||||||||
Abengoa S.A. ‘B’ | 99,482 | 21 | ||||||||||
Abertis Infraestructuras S.A. | 3,690 | 58 | ||||||||||
Acciona S.A. | 2,454 | 210 | ||||||||||
ACS Actividades de Construccion y Servicios S.A. | 4,482 | 131 | ||||||||||
Ferrovial S.A. | 9,551 | 216 | ||||||||||
Fomento de Construcciones y Contratas S.A. | 21,172 | 161 | ||||||||||
|
| |||||||||||
797 | ||||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 0.0% | ||||||||||||
Indra Sistemas S.A. (a) | 2,936 | 28 | ||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 0.9% | ||||||||||||
Telefonica S.A. | 162,142 | 1,799 | ||||||||||
|
| |||||||||||
UTILITIES 0.6% | ||||||||||||
Endesa S.A. | 26,132 | 525 | ||||||||||
Gas Natural SDG S.A. | 6,690 | 136 | ||||||||||
Iberdrola S.A. | 68,275 | 484 | ||||||||||
|
| |||||||||||
1,145 | ||||||||||||
|
| |||||||||||
Total Spain | 6,924 | |||||||||||
|
| |||||||||||
SWEDEN 2.1% | ||||||||||||
CONSUMER DISCRETIONARY 0.2% | ||||||||||||
Autoliv, Inc. | 475 | 59 |
SHARES | MARKET VALUE (000S) | |||||||||||
Electrolux AB ‘B’ | 5,544 | $ | 134 | |||||||||
Hennes & Mauritz AB ‘B’ | 5,797 | 206 | ||||||||||
Husqvarna AB ‘B’ | 4,479 | 30 | ||||||||||
|
| |||||||||||
429 | ||||||||||||
|
| |||||||||||
CONSUMER STAPLES 0.2% | ||||||||||||
Svenska Cellulosa AB S.C.A. ‘B’ | 5,486 | 159 | ||||||||||
Swedish Match AB | 4,555 | 161 | ||||||||||
|
| |||||||||||
320 | ||||||||||||
|
| |||||||||||
FINANCIALS 0.4% | ||||||||||||
Nordea Bank AB | 39,678 | 435 | ||||||||||
Ratos AB ‘B’ | 10,644 | 62 | ||||||||||
Skandinaviska Enskilda Banken AB | 12,093 | 127 | ||||||||||
Svenska Handelsbanken AB ‘A’ | 9,299 | 124 | ||||||||||
Swedbank AB ‘A’ | 8,046 | 177 | ||||||||||
|
| |||||||||||
925 | ||||||||||||
|
| |||||||||||
HEALTH CARE 0.0% | ||||||||||||
Getinge AB ‘B’ | 1,336 | 35 | ||||||||||
|
| |||||||||||
INDUSTRIALS 0.5% | ||||||||||||
Assa Abloy AB | 1,452 | 31 | ||||||||||
Atlas Copco AB ‘A’ | 7,753 | 190 | ||||||||||
NCC AB ‘B’ | 2,591 | 80 | ||||||||||
Sandvik AB | 14,791 | 129 | ||||||||||
Securitas AB ‘B’ | 9,344 | 143 | ||||||||||
Skanska AB ‘B’ | 6,292 | 122 | ||||||||||
SKF AB ‘B’ | 3,298 | 53 | ||||||||||
Volvo AB ‘B’ | 26,201 | 243 | ||||||||||
|
| |||||||||||
991 | ||||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 0.2% | ||||||||||||
Telefonaktiebolaget LM Ericsson ‘B’ | 44,664 | 430 | ||||||||||
|
| |||||||||||
MATERIALS 0.1% | ||||||||||||
Boliden AB | 10,495 | 176 | ||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 0.5% | ||||||||||||
Tele2 AB ‘B’ | 52,724 | 526 | ||||||||||
TeliaSonera AB | 81,834 | 406 | ||||||||||
|
| |||||||||||
932 | ||||||||||||
|
| |||||||||||
Total Sweden | 4,238 | |||||||||||
|
| |||||||||||
SWITZERLAND 5.3% | ||||||||||||
CONSUMER STAPLES 0.7% | ||||||||||||
Coca-Cola HBC AG | 2,577 | 55 | ||||||||||
Nestle S.A. | 17,053 | 1,266 | ||||||||||
|
| |||||||||||
1,321 | ||||||||||||
|
| |||||||||||
ENERGY 0.3% | ||||||||||||
Transocean Ltd. | 35,109 | 434 | ||||||||||
Weatherford International PLC (a) | 26,301 | 221 | ||||||||||
|
| |||||||||||
655 | ||||||||||||
|
| |||||||||||
46 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
SHARES | MARKET VALUE (000S) | |||||||||||
FINANCIALS 1.7% | ||||||||||||
Allied World Assurance Co. Holdings AG | 3,127 | $ | 116 | |||||||||
Baloise Holding AG | 673 | 85 | ||||||||||
Credit Suisse Group AG | 33,662 | 725 | ||||||||||
Helvetia Holding AG | 158 | 89 | ||||||||||
Swiss Life Holding AG | 631 | 170 | ||||||||||
Swiss Re AG | 11,097 | 1,084 | ||||||||||
UBS Group AG | 10,476 | 203 | ||||||||||
Zurich Insurance Group AG | 3,750 | 964 | ||||||||||
|
| |||||||||||
3,436 | ||||||||||||
|
| |||||||||||
HEALTH CARE 1.7% | ||||||||||||
Novartis AG | 22,387 | 1,926 | ||||||||||
Roche Holding AG | 5,632 | 1,560 | ||||||||||
|
| |||||||||||
3,486 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 0.3% | ||||||||||||
ABB Ltd. | 13,973 | 249 | ||||||||||
Adecco S.A. | 899 | 62 | ||||||||||
Schindler Holding AG | 1,235 | 207 | ||||||||||
Wolseley PLC | 2,560 | 139 | ||||||||||
|
| |||||||||||
657 | ||||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 0.2% | ||||||||||||
STMicroelectronics NV | 8,273 | 55 | ||||||||||
TE Connectivity Ltd. | 3,787 | 245 | ||||||||||
|
| |||||||||||
300 | ||||||||||||
|
| |||||||||||
MATERIALS 0.4% | ||||||||||||
Clariant AG | 2,656 | 50 | ||||||||||
Givaudan S.A. | 33 | 60 | ||||||||||
Glencore PLC | 149,375 | 198 | ||||||||||
LafargeHolcim Ltd. | 1,250 | 63 | ||||||||||
Syngenta AG | 1,060 | 415 | ||||||||||
|
| |||||||||||
786 | ||||||||||||
|
| |||||||||||
Total Switzerland | 10,641 | |||||||||||
|
| |||||||||||
UNITED KINGDOM 17.0% | ||||||||||||
CONSUMER DISCRETIONARY 1.6% | ||||||||||||
Barratt Developments PLC | 3,295 | 30 | ||||||||||
British Sky Broadcasting Group PLC | 12,518 | 205 | ||||||||||
Burberry Group PLC | 3,068 | 54 | ||||||||||
Compass Group PLC | 21,239 | 368 | ||||||||||
Fiat Chrysler Automobiles NV (a) | 39,584 | 554 | ||||||||||
Greene King PLC | 2,953 | 41 | ||||||||||
Home Retail Group PLC | 82,860 | 121 | ||||||||||
Inchcape PLC | 4,252 | 49 | ||||||||||
Informa PLC | 3,244 | 29 | ||||||||||
InterContinental Hotels Group PLC | 2,976 | 116 | ||||||||||
ITV PLC | 34,245 | 140 | ||||||||||
Kingfisher PLC | 40,171 | 195 | ||||||||||
Marks & Spencer Group PLC | 33,224 | 221 | ||||||||||
Next PLC | 1,241 | 133 | ||||||||||
Pearson PLC | 12,792 | 138 |
SHARES | MARKET VALUE (000S) | |||||||||||
RELX NV | 7,379 | $ | 124 | |||||||||
RELX PLC | 5,014 | 89 | ||||||||||
Thomas Cook Group PLC (a) | 117,112 | 209 | ||||||||||
WPP PLC | 20,174 | 464 | ||||||||||
|
| |||||||||||
3,280 | ||||||||||||
|
| |||||||||||
CONSUMER STAPLES 2.9% | ||||||||||||
Associated British Foods PLC | 1,151 | 57 | ||||||||||
British American Tobacco PLC | 23,177 | 1,287 | ||||||||||
Diageo PLC | 20,401 | 557 | ||||||||||
Imperial Tobacco Group PLC | 16,374 | 865 | ||||||||||
J Sainsbury PLC | 66,870 | 255 | ||||||||||
Reckitt Benckiser Group PLC | 5,280 | 488 | ||||||||||
SABMiller PLC | 6,782 | 406 | ||||||||||
Tate & Lyle PLC | 3,297 | 29 | ||||||||||
Tesco PLC | 206,744 | 454 | ||||||||||
Unilever NV - Dutch Certificate | 12,762 | 556 | ||||||||||
Unilever PLC | 7,013 | 301 | ||||||||||
WM Morrison Supermarkets PLC | 237,891 | 518 | ||||||||||
|
| |||||||||||
5,773 | ||||||||||||
|
| |||||||||||
ENERGY 1.7% | ||||||||||||
BG Group PLC | 23,443 | 340 | ||||||||||
BP PLC | 576,590 | 2,996 | ||||||||||
Petrofac Ltd. | 2,951 | 35 | ||||||||||
Subsea 7 S.A. | 13,255 | 94 | ||||||||||
Tullow Oil PLC | 21,289 | 52 | ||||||||||
|
| |||||||||||
3,517 | ||||||||||||
|
| |||||||||||
FINANCIALS 5.3% | ||||||||||||
3i Group PLC | 4,182 | 30 | ||||||||||
Admiral Group PLC | 1,231 | 30 | ||||||||||
Amlin PLC | 13,439 | 131 | ||||||||||
Aviva PLC | 65,885 | 500 | ||||||||||
Barclays PLC | 477,696 | 1,538 | ||||||||||
Direct Line Insurance Group PLC | 39,358 | 236 | ||||||||||
HSBC Holdings PLC | 535,875 | 4,230 | ||||||||||
ICAP PLC | 24,723 | 186 | ||||||||||
IG Group Holdings PLC | 2,578 | 31 | ||||||||||
Intermediate Capital Group PLC | 10,343 | 95 | ||||||||||
Lancashire Holdings Ltd. | 15,823 | 146 | ||||||||||
Legal & General Group PLC | 35,576 | 140 | ||||||||||
Lloyds Banking Group PLC | 1,008,419 | 1,085 | ||||||||||
Man Group PLC | 145,509 | 374 | ||||||||||
Old Mutual PLC | 184,106 | 484 | ||||||||||
Prudential PLC | 5,433 | 122 | ||||||||||
Royal Bank of Scotland Group PLC (a) | 94,895 | 422 | ||||||||||
RSA Insurance Group PLC | 12,701 | 80 | ||||||||||
Standard Chartered PLC | 86,574 | 718 | ||||||||||
Standard Life PLC | 18,423 | 106 | ||||||||||
|
| |||||||||||
10,684 | ||||||||||||
|
| |||||||||||
HEALTH CARE 1.4% | ||||||||||||
AstraZeneca PLC | 22,555 | 1,523 | ||||||||||
GlaxoSmithKline PLC | 57,521 | 1,162 |
SHARES | MARKET VALUE (000S) | |||||||||||
Smith & Nephew PLC | 5,711 | $ | 102 | |||||||||
|
| |||||||||||
2,787 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 1.1% | ||||||||||||
AA PLC | 5,926 | 27 | ||||||||||
BAE Systems PLC | 87,811 | 647 | ||||||||||
Balfour Beatty PLC | 7,635 | 30 | ||||||||||
Bunzl PLC | 1,963 | 54 | ||||||||||
Capita PLC | 1,610 | 29 | ||||||||||
Carillion PLC | 5,103 | 23 | ||||||||||
CNH Industrial NV | 44,826 | 307 | ||||||||||
easyJet PLC | 676 | 17 | ||||||||||
Firstgroup PLC (a) | 70,719 | 112 | ||||||||||
G4S PLC | 17,757 | 59 | ||||||||||
International Consolidated Airlines Group S.A. | 31,661 | 285 | ||||||||||
National Express Group PLC | 14,508 | 71 | ||||||||||
QinetiQ Group PLC | 13,681 | 55 | ||||||||||
Rentokil Initial PLC | 44,234 | 104 | ||||||||||
Rolls-Royce Holdings PLC | 11,865 | 100 | ||||||||||
Royal Mail PLC | 48,047 | 315 | ||||||||||
Smiths Group PLC | 1,979 | 27 | ||||||||||
|
| |||||||||||
2,262 | ||||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 0.2% | ||||||||||||
ARM Holdings PLC | 7,722 | 118 | ||||||||||
Sage Group PLC | 21,221 | 188 | ||||||||||
|
| |||||||||||
306 | ||||||||||||
|
| |||||||||||
MATERIALS 1.0% | ||||||||||||
Anglo American PLC | 107,604 | 472 | ||||||||||
DS Smith PLC | 8,140 | 48 | ||||||||||
KAZ Minerals PLC (a) | 19,733 | 30 | ||||||||||
Rexam PLC | 6,452 | 57 | ||||||||||
Rio Tinto Ltd. | 16,528 | 534 | ||||||||||
Rio Tinto PLC | 29,352 | 855 | ||||||||||
|
| |||||||||||
1,996 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 1.0% | ||||||||||||
BT Group PLC | 76,922 | 534 | ||||||||||
Cable & Wireless Communications PLC | 88,081 | 97 | ||||||||||
Vodafone Group PLC | 422,495 | 1,370 | ||||||||||
|
| |||||||||||
2,001 | ||||||||||||
|
| |||||||||||
UTILITIES 0.8% | ||||||||||||
Centrica PLC | 148,646 | 477 | ||||||||||
Drax Group PLC | 8,632 | 31 | ||||||||||
National Grid PLC | 44,603 | 615 | ||||||||||
Severn Trent PLC | 3,142 | 100 | ||||||||||
SSE PLC | 12,553 | 282 | ||||||||||
United Utilities Group PLC | 8,471 | 117 | ||||||||||
|
| |||||||||||
1,622 | ||||||||||||
|
| |||||||||||
Total United Kingdom | 34,228 | |||||||||||
|
|
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 47 |
Table of Contents
Schedule of Investments PIMCO RAE Fundamental International Fund (Cont.)
SHARES | MARKET VALUE (000S) | |||||||||||
UNITED STATES 0.2% | ||||||||||||
CONSUMER DISCRETIONARY 0.2% | ||||||||||||
Carnival PLC | 3,211 | $ | 183 | |||||||||
Thomson Reuters Corp. | 4,918 | 186 | ||||||||||
|
| |||||||||||
369 | ||||||||||||
|
| |||||||||||
Total United States | 369 | |||||||||||
|
| |||||||||||
Total Common Stocks (Cost $193,721) | 198,848 | |||||||||||
|
| |||||||||||
PREFERRED STOCKS 0.7% | ||||||||||||
GERMANY 0.7% | ||||||||||||
CONSUMER DISCRETIONARY 0.5% | ||||||||||||
Porsche Automobil Holding SE | 1,455 | 78 | ||||||||||
Volkswagen AG | 6,743 | 974 | ||||||||||
|
| |||||||||||
1,052 | ||||||||||||
|
| |||||||||||
CONSUMER STAPLES 0.2% | ||||||||||||
Henkel AG & Co. KGaA | 2,741 | 306 | ||||||||||
|
| |||||||||||
Total Preferred Stocks (Cost $1,346) | 1,358 | |||||||||||
|
| |||||||||||
REAL ESTATE INVESTMENT TRUSTS 0.8% | ||||||||||||
AUSTRALIA 0.3% | ||||||||||||
FINANCIALS 0.3% | ||||||||||||
Dexus Property Group | 18,776 | 102 | ||||||||||
GPT Group | 10,602 | 37 | ||||||||||
Mirvac Group | 58,086 | 83 | ||||||||||
Scentre Group | 28,991 | 88 |
SHARES | MARKET VALUE (000S) | |||||||||||
Stockland | 65,494 | $ | 194 | |||||||||
Westfield Corp. | 24,643 | 170 | ||||||||||
|
| |||||||||||
674 | ||||||||||||
|
| |||||||||||
Total Australia | 674 | |||||||||||
|
| |||||||||||
CANADA 0.1% | ||||||||||||
FINANCIALS 0.1% | ||||||||||||
Cominar Real Estate Investment Trust | 2,714 | 29 | ||||||||||
RioCan Real Estate Investment Trust | 2,147 | 37 | ||||||||||
Smart Real Estate Investment Trust | 1,971 | 43 | ||||||||||
|
| |||||||||||
109 | ||||||||||||
|
| |||||||||||
Total Canada | 109 | |||||||||||
|
| |||||||||||
FRANCE 0.1% | ||||||||||||
FINANCIALS 0.1% | ||||||||||||
Fonciere Des Regions | 827 | 74 | ||||||||||
Unibail-Rodamco SE | 917 | 233 | ||||||||||
|
| |||||||||||
307 | ||||||||||||
|
| |||||||||||
Total France | 307 | |||||||||||
|
| |||||||||||
HONG KONG 0.1% | ||||||||||||
FINANCIALS 0.1% | ||||||||||||
Link REIT | 24,500 | 146 | ||||||||||
|
| |||||||||||
Total Hong Kong | 146 | |||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
UNITED KINGDOM 0.2% | ||||||||||||
FINANCIALS 0.2% | ||||||||||||
Hammerson PLC | 6,826 | $ | 60 | |||||||||
Intu Properties PLC | 6,308 | 29 | ||||||||||
Land Securities Group PLC | 7,010 | 122 | ||||||||||
Segro PLC | 22,881 | 145 | ||||||||||
|
| |||||||||||
356 | ||||||||||||
|
| |||||||||||
Total United Kingdom | 356 | |||||||||||
|
| |||||||||||
Total Real Estate Investment Trusts (Cost $1,587) | 1,592 | |||||||||||
|
| |||||||||||
RIGHTS 0.0% | ||||||||||||
ITALY 0.0% | ||||||||||||
FINANCIALS 0.0% | ||||||||||||
UBI BANCA RIGHTS | 21,420 | 0 | ||||||||||
Unipol Gruppo Finanziario SpA | 8,246 | 0 | ||||||||||
|
| |||||||||||
0 | ||||||||||||
|
| |||||||||||
Total Rights (Cost $0) | 0 | |||||||||||
|
| |||||||||||
Total Investments in Securities (Cost $196,654) | 201,798 | |||||||||||
Total Investments 100.0% (Cost $196,654) | $ | 201,798 | ||||||||||
Other Assets and Liabilities, net 0.0% | 26 | |||||||||||
|
| |||||||||||
Net Assets 100.0% | $ | 201,824 | ||||||||||
|
|
NOTES TO SCHEDULE OF INVESTMENTS (AMOUNTS IN THOUSANDS*):
* | A zero balance may reflect actual amounts rounding to less than one thousand. |
(a) | Security did not produce income within the last twelve months. |
(b) RESTRICTED SECURITIES:
Issuer Description | Acquisition Date | Cost | Market Value | Market Value as Percentage of Net Assets | ||||||||||||||||
Canadian Imperial Bank of Commerce | 06/08/2015 | $ | 789 | $ | 687 | 0.34% | ||||||||||||||
Great-West Lifeco, Inc. | 06/08/2015 | 231 | 216 | 0.11% | ||||||||||||||||
|
|
|
|
|
| |||||||||||||||
$ | 1,020 | $ | 903 | 0.45% | ||||||||||||||||
|
|
|
|
|
|
FAIR VALUE OF FINANCIAL DERIVATIVE INSTRUMENTS
The following is a summary of the fair valuation of the Fund’s derivative instruments categorized by risk exposure. See Note 6, Principal Risks, in the Notes to Financial Statements on risks of the Fund.
The effect of Financial Derivative Instruments on the Statements of Operations for the period ended December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Net Realized Gain on Financial Derivative Instruments | ||||||||||||||||||||||||
Over the counter | ||||||||||||||||||||||||
Forward Foreign Currency Contracts | $ | 0 | $ | 0 | $ | 0 | $ | 4 | $ | 0 | $ | 4 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
48 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
FAIR VALUE MEASUREMENTS
The following is a summary of the fair valuations according to the inputs used as of December 31, 2015 in valuing the Fund’s assets and liabilities:
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Investments in Securities, at Value | ||||||||||||||||
Common Stocks | ||||||||||||||||
Australia | ||||||||||||||||
Consumer Discretionary | $ | 0 | $ | 602 | $ | 0 | $ | 602 | ||||||||
Consumer Staples | 0 | 1,752 | 0 | 1,752 | ||||||||||||
Energy | 0 | 658 | 0 | 658 | ||||||||||||
Financials | 0 | 8,904 | 0 | 8,904 | ||||||||||||
Health Care | 0 | 568 | 0 | 568 | ||||||||||||
Industrials | 0 | 1,372 | 0 | 1,372 | ||||||||||||
Materials | 0 | 3,443 | 0 | 3,443 | ||||||||||||
Telecommunication Services | 0 | 491 | 0 | 491 | ||||||||||||
Utilities | 0 | 357 | 0 | 357 | ||||||||||||
Austria | ||||||||||||||||
Energy | 0 | 445 | 0 | 445 | ||||||||||||
Financials | 0 | 733 | 0 | 733 | ||||||||||||
Materials | 0 | 172 | 0 | 172 | ||||||||||||
Utilities | 27 | 0 | 0 | 27 | ||||||||||||
Belgium | ||||||||||||||||
Consumer Staples | 0 | 1,114 | 0 | 1,114 | ||||||||||||
Financials | 0 | 502 | 0 | 502 | ||||||||||||
Materials | 0 | 115 | 0 | 115 | ||||||||||||
Telecommunication Services | 0 | 259 | 0 | 259 | ||||||||||||
Canada | ||||||||||||||||
Consumer Discretionary | 436 | 0 | 0 | 436 | ||||||||||||
Consumer Staples | 349 | 0 | 0 | 349 | ||||||||||||
Energy | 3,918 | 0 | 0 | 3,918 | ||||||||||||
Financials | 6,880 | 0 | 0 | 6,880 | ||||||||||||
Industrials | 1,229 | 0 | 0 | 1,229 | ||||||||||||
Information Technology | 456 | 0 | 0 | 456 | ||||||||||||
Materials | 1,918 | 0 | 0 | 1,918 | ||||||||||||
Telecommunication Services | 1,096 | 0 | 0 | 1,096 | ||||||||||||
Utilities | 356 | 0 | 0 | 356 | ||||||||||||
Chile | ||||||||||||||||
Materials | 0 | 103 | 0 | 103 | ||||||||||||
China | ||||||||||||||||
Consumer Discretionary | 0 | 25 | 0 | 25 | ||||||||||||
Colombia | ||||||||||||||||
Energy | 98 | 0 | 0 | 98 | ||||||||||||
Denmark | ||||||||||||||||
Consumer Discretionary | 0 | 30 | 0 | 30 | ||||||||||||
Consumer Staples | 0 | 289 | 0 | 289 | ||||||||||||
Financials | 0 | 242 | 0 | 242 | ||||||||||||
Health Care | 0 | 978 | 0 | 978 | ||||||||||||
Industrials | 0 | 806 | 0 | 806 | ||||||||||||
Telecommunication Services | 0 | 401 | 0 | 401 | ||||||||||||
Finland | ||||||||||||||||
Consumer Discretionary | 0 | 30 | 0 | 30 | ||||||||||||
Consumer Staples | 0 | 78 | 0 | 78 | ||||||||||||
Energy | 0 | 86 | 0 | 86 | ||||||||||||
Health Care | 0 | 37 | 0 | 37 | ||||||||||||
Industrials | 0 | 57 | 0 | 57 | ||||||||||||
Information Technology | 0 | 195 | 0 | 195 | ||||||||||||
Materials | 0 | 399 | 0 | 399 | ||||||||||||
Telecommunication Services | 0 | 43 | 0 | 43 | ||||||||||||
Utilities | 0 | 117 | 0 | 117 | ||||||||||||
France | ||||||||||||||||
Consumer Discretionary | 0 | 2,890 | 0 | 2,890 | ||||||||||||
Consumer Staples | 0 | 1,360 | 0 | 1,360 | ||||||||||||
Energy | 0 | 3,421 | 0 | 3,421 | ||||||||||||
Financials | 0 | 3,841 | 0 | 3,841 | ||||||||||||
Health Care | 0 | 1,341 | 0 | 1,341 | ||||||||||||
Industrials | 0 | 3,719 | 0 | 3,719 | ||||||||||||
Information Technology | 49 | 516 | 0 | 565 | ||||||||||||
Materials | 0 | 372 | 0 | 372 | ||||||||||||
Telecommunication Services | 0 | 2,688 | 0 | 2,688 | ||||||||||||
Utilities | 0 | 2,906 | 0 | 2,906 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Germany | ||||||||||||||||
Consumer Discretionary | $ | 0 | $ | 2,763 | $ | 0 | $ | 2,763 | ||||||||
Consumer Staples | 0 | 976 | 0 | 976 | ||||||||||||
Financials | 0 | 3,067 | 0 | 3,067 | ||||||||||||
Health Care | 0 | 2,024 | 0 | 2,024 | ||||||||||||
Industrials | 0 | 3,698 | 0 | 3,698 | ||||||||||||
Information Technology | 0 | 670 | 0 | 670 | ||||||||||||
Materials | 0 | 2,603 | 0 | 2,603 | ||||||||||||
Telecommunication Services | 0 | 1,780 | 0 | 1,780 | ||||||||||||
Utilities | 0 | 1,712 | 0 | 1,712 | ||||||||||||
Hong Kong | ||||||||||||||||
Consumer Discretionary | 0 | 310 | 0 | 310 | ||||||||||||
Consumer Staples | 0 | 414 | 0 | 414 | ||||||||||||
Financials | 0 | 2,218 | 0 | 2,218 | ||||||||||||
Industrials | 0 | 439 | 0 | 439 | ||||||||||||
Telecommunication Services | 0 | 71 | 0 | 71 | ||||||||||||
Utilities | 0 | 242 | 0 | 242 | ||||||||||||
Ireland | ||||||||||||||||
Health Care | 959 | 360 | 0 | 1,319 | ||||||||||||
Industrials | 0 | 191 | 0 | 191 | ||||||||||||
Materials | 0 | 534 | 0 | 534 | ||||||||||||
Israel | ||||||||||||||||
Financials | 0 | 382 | 0 | 382 | ||||||||||||
Health Care | 889 | 0 | 0 | 889 | ||||||||||||
Materials | 0 | 130 | 0 | 130 | ||||||||||||
Telecommunication Services | 0 | 371 | 0 | 371 | ||||||||||||
Italy | ||||||||||||||||
Consumer Discretionary | 0 | 116 | 0 | 116 | ||||||||||||
Energy | 0 | 1,871 | 0 | 1,871 | ||||||||||||
Financials | 0 | 1,603 | 0 | 1,603 | ||||||||||||
Industrials | 0 | 77 | 0 | 77 | ||||||||||||
Materials | 184 | 0 | 0 | 184 | ||||||||||||
Telecommunication Services | 0 | 928 | 0 | 928 | ||||||||||||
Utilities | 0 | 1,465 | 0 | 1,465 | ||||||||||||
Japan | ||||||||||||||||
Consumer Discretionary | 0 | 3,661 | 0 | 3,661 | ||||||||||||
Consumer Staples | 0 | 2,553 | 0 | 2,553 | ||||||||||||
Energy | 0 | 955 | 0 | 955 | ||||||||||||
Financials | 0 | 5,621 | 0 | 5,621 | ||||||||||||
Health Care | 0 | 1,814 | 0 | 1,814 | ||||||||||||
Industrials | 0 | 3,740 | 0 | 3,740 | ||||||||||||
Information Technology | 0 | 3,353 | 0 | 3,353 | ||||||||||||
Materials | 0 | 3,001 | 0 | 3,001 | ||||||||||||
Telecommunication Services | 0 | 2,536 | 0 | 2,536 | ||||||||||||
Utilities | 0 | 1,624 | 0 | 1,624 | ||||||||||||
Luxembourg | ||||||||||||||||
Consumer Discretionary | 0 | 170 | 0 | 170 | ||||||||||||
Materials | 0 | 321 | 0 | 321 | ||||||||||||
Netherlands | ||||||||||||||||
Consumer Discretionary | 0 | 113 | 0 | 113 | ||||||||||||
Consumer Staples | 0 | 1,279 | 0 | 1,279 | ||||||||||||
Energy | 0 | 4,323 | 0 | 4,323 | ||||||||||||
Financials | 1,373 | 342 | 0 | 1,715 | ||||||||||||
Industrials | 0 | 697 | 0 | 697 | ||||||||||||
Materials | 0 | 304 | 0 | 304 | ||||||||||||
Telecommunication Services | 122 | 431 | 0 | 553 | ||||||||||||
New Zealand | ||||||||||||||||
Materials | 0 | 77 | 0 | 77 | ||||||||||||
Telecommunication Services | 0 | 283 | 0 | 283 | ||||||||||||
Utilities | 0 | 30 | 0 | 30 | ||||||||||||
Norway | ||||||||||||||||
Consumer Staples | 0 | 163 | 0 | 163 | ||||||||||||
Energy | 0 | 1,633 | 0 | 1,633 | ||||||||||||
Financials | 0 | 200 | 0 | 200 | ||||||||||||
Materials | 0 | 288 | 0 | 288 | ||||||||||||
Telecommunication Services | 0 | 196 | 0 | 196 |
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 49 |
Table of Contents
Schedule of Investments PIMCO RAE Fundamental International Fund (Cont.)
December 31, 2015 (Unaudited)
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Portugal | ||||||||||||||||
Consumer Staples | $ | 0 | $ | 28 | $ | 0 | $ | 28 | ||||||||
Financials | 0 | 0 | 1 | 1 | ||||||||||||
Telecommunication Services | 0 | 32 | 0 | 32 | ||||||||||||
Utilities | 0 | 424 | 0 | 424 | ||||||||||||
Singapore | ||||||||||||||||
Consumer Discretionary | 0 | 186 | 0 | 186 | ||||||||||||
Financials | 0 | 960 | 0 | 960 | ||||||||||||
Industrials | 0 | 601 | 0 | 601 | ||||||||||||
Information Technology | 221 | 0 | 0 | 221 | ||||||||||||
Telecommunication Services | 0 | 290 | 0 | 290 | ||||||||||||
South Africa | ||||||||||||||||
Financials | 0 | 62 | 0 | 62 | ||||||||||||
Materials | 0 | 124 | 0 | 124 | ||||||||||||
Spain | ||||||||||||||||
Consumer Discretionary | 0 | 330 | 0 | 330 | ||||||||||||
Energy | 0 | 288 | 0 | 288 | ||||||||||||
Financials | 0 | 2,537 | 0 | 2,537 | ||||||||||||
Industrials | 21 | 776 | 0 | 797 | ||||||||||||
Information Technology | 0 | 28 | 0 | 28 | ||||||||||||
Telecommunication Services | 0 | 1,799 | 0 | 1,799 | ||||||||||||
Utilities | 0 | 1,145 | 0 | 1,145 | ||||||||||||
Sweden | ||||||||||||||||
Consumer Discretionary | 59 | 370 | 0 | 429 | ||||||||||||
Consumer Staples | 0 | 320 | 0 | 320 | ||||||||||||
Financials | 0 | 925 | 0 | 925 | ||||||||||||
Health Care | 0 | 35 | 0 | 35 | ||||||||||||
Industrials | 0 | 991 | 0 | 991 | ||||||||||||
Information Technology | 0 | 430 | 0 | 430 | ||||||||||||
Materials | 0 | 176 | 0 | 176 | ||||||||||||
Telecommunication Services | 0 | 932 | 0 | 932 | ||||||||||||
Switzerland | ||||||||||||||||
Consumer Staples | 0 | 1,321 | 0 | 1,321 | ||||||||||||
Energy | 655 | 0 | 0 | 655 | ||||||||||||
Financials | 116 | 3,320 | 0 | 3,436 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Health Care | $ | 0 | $ | 3,486 | $ | 0 | $ | 3,486 | ||||||||
Industrials | 0 | 657 | 0 | 657 | ||||||||||||
Information Technology | 245 | 55 | 0 | 300 | ||||||||||||
Materials | 0 | 786 | 0 | 786 | ||||||||||||
United Kingdom | ||||||||||||||||
Consumer Discretionary | 554 | 2,726 | 0 | 3,280 | ||||||||||||
Consumer Staples | 556 | 5,217 | 0 | 5,773 | ||||||||||||
Energy | 0 | 3,517 | 0 | 3,517 | ||||||||||||
Financials | 0 | 10,684 | 0 | 10,684 | ||||||||||||
Health Care | 0 | 2,787 | 0 | 2,787 | ||||||||||||
Industrials | 71 | 2,191 | 0 | 2,262 | ||||||||||||
Information Technology | 0 | 306 | 0 | 306 | ||||||||||||
Materials | 0 | 1,996 | 0 | 1,996 | ||||||||||||
Telecommunication Services | 0 | 2,001 | 0 | 2,001 | ||||||||||||
Utilities | 0 | 1,622 | 0 | 1,622 | ||||||||||||
United States | ||||||||||||||||
Consumer Discretionary | 186 | 183 | 0 | 369 | ||||||||||||
Preferred Stocks | ||||||||||||||||
Germany | ||||||||||||||||
Consumer Discretionary | 0 | 1,052 | 0 | 1,052 | ||||||||||||
Consumer Staples | 0 | 306 | 0 | 306 | ||||||||||||
Real Estate Investment Trusts | ||||||||||||||||
Australia | ||||||||||||||||
Financials | 0 | 674 | 0 | 674 | ||||||||||||
Canada | ||||||||||||||||
Financials | 109 | 0 | 0 | 109 | ||||||||||||
France | ||||||||||||||||
Financials | 0 | 307 | 0 | 307 | ||||||||||||
Hong Kong | ||||||||||||||||
Financials | 0 | 146 | 0 | 146 | ||||||||||||
United Kingdom | ||||||||||||||||
Financials | 0 | 356 | 0 | 356 | ||||||||||||
Total Investments | $ | 23,132 | $ | 178,665 | $ | 1 | $ | 201,798 |
There were assets and liabilities valued at $2,254 transferred from Level 2 to Level 1 during the period ended December 31, 2015. There were no significant assets and liabilities transferred from Level 1 to Level 2 during the period ended December 31, 2015. There were no significant transfers between Levels 2 and 3 during the period ended December 31, 2015.
50 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
Schedule of Investments PIMCO RAE Fundamental US Fund
December 31, 2015 (Unaudited)
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN SECURITIES 99.6% | ||||||||||||
COMMON STOCKS 98.7% | ||||||||||||
IRELAND 0.3% | ||||||||||||
FINANCIALS 0.0% | ||||||||||||
XL Group PLC | 2,489 | $ | 98 | |||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 0.3% | ||||||||||||
Accenture PLC ‘A’ | 14,434 | 1,508 | ||||||||||
|
| |||||||||||
Total Ireland | 1,606 | |||||||||||
|
| |||||||||||
PERU 0.0% | ||||||||||||
MATERIALS 0.0% | ||||||||||||
Southern Copper Corp. | 3,286 | 86 | ||||||||||
|
| |||||||||||
Total Peru | 86 | |||||||||||
|
| |||||||||||
UNITED STATES 98.4% | ||||||||||||
CONSUMER DISCRETIONARY 15.0% | ||||||||||||
Aaron’s, Inc. | 18,499 | 414 | ||||||||||
Abercrombie & Fitch Co. ‘A’ | 29,857 | 806 | ||||||||||
Advance Auto Parts, Inc. | 351 | 53 | ||||||||||
Amazon.com, Inc. (a) | 5,852 | 3,955 | ||||||||||
American Eagle Outfitters, Inc. | 38,373 | 595 | ||||||||||
Apollo Education Group, Inc. (a) | 26,379 | 202 | ||||||||||
Aramark | 2,689 | 87 | ||||||||||
Ascena Retail Group, Inc. (a) | 2,925 | 29 | ||||||||||
AutoNation, Inc. (a) | 2,761 | 165 | ||||||||||
AutoZone, Inc. (a) | 371 | 275 | ||||||||||
Barnes & Noble, Inc. | 9,004 | 78 | ||||||||||
Bed Bath & Beyond, Inc. (a) | 24,757 | 1,194 | ||||||||||
Best Buy Co., Inc. | 33,777 | 1,028 | ||||||||||
Big Lots, Inc. | 17,633 | 680 | ||||||||||
Bloomin’ Brands, Inc. | 23,239 | 392 | ||||||||||
Bob Evans Farms, Inc. | 5,858 | 228 | ||||||||||
Boyd Gaming Corp. (a) | 3,956 | 79 | ||||||||||
Brinker International, Inc. | 3,927 | 188 | ||||||||||
Burlington Stores, Inc. (a) | 9,769 | 419 | ||||||||||
Cabela’s, Inc. (a) | 1,679 | 78 | ||||||||||
Cablevision Systems Corp. ‘A’ | 28,839 | 920 | ||||||||||
Caesars Entertainment Corp. (a) | 21,689 | 171 | ||||||||||
Carnival Corp. | 16,917 | 922 | ||||||||||
Carter’s, Inc. | 539 | 48 | ||||||||||
CBS Corp. ‘B’ | 11,588 | 546 | ||||||||||
Charter Communications, Inc. ‘A’ (a) | 358 | 65 | ||||||||||
Chico’s FAS, Inc. | 30,131 | 321 | ||||||||||
Cinemark Holdings, Inc. | 9,221 | 308 | ||||||||||
Coach, Inc. | 41,921 | 1,372 | ||||||||||
Comcast Corp. ‘A’ | 51,052 | 2,881 | ||||||||||
Cooper Tire & Rubber Co. | 1,923 | 73 | ||||||||||
Cracker Barrel Old Country Store, Inc. | 1,393 | 177 | ||||||||||
CST Brands, Inc. | 2,399 | 94 | ||||||||||
Dana Holding Corp. | 3,115 | 43 | ||||||||||
DeVry Education Group, Inc. | 10,550 | 267 | ||||||||||
Dick’s Sporting Goods, Inc. | 2,028 | 72 | ||||||||||
Dillard’s, Inc. ‘A’ | 6,710 | 441 |
SHARES | MARKET VALUE (000S) | |||||||||||
Discovery Communications, Inc. ‘A’ (a) | 5,890 | $ | 157 | |||||||||
Dollar General Corp. | 6,258 | 450 | ||||||||||
Dollar Tree, Inc. (a) | 7,118 | 550 | ||||||||||
Domino’s Pizza, Inc. | 744 | 83 | ||||||||||
Expedia, Inc. | 2,818 | 350 | ||||||||||
Express, Inc. (a) | 4,410 | 76 | ||||||||||
Foot Locker, Inc. | 2,538 | 165 | ||||||||||
Ford Motor Co. | 18,670 | 263 | ||||||||||
Fossil Group, Inc. (a) | 9,056 | 331 | ||||||||||
GameStop Corp. ‘A’ | 20,175 | 566 | ||||||||||
Gap, Inc. | 37,658 | 930 | ||||||||||
Genesco, Inc. (a) | 5,201 | 296 | ||||||||||
Genuine Parts Co. | 2,058 | 177 | ||||||||||
GNC Holdings, Inc. ‘A’ | 7,757 | 241 | ||||||||||
Graham Holdings Co. ‘B’ | 523 | 254 | ||||||||||
Guess?, Inc. | 22,286 | 421 | ||||||||||
Hasbro, Inc. | 7,506 | 506 | ||||||||||
Hilton Worldwide Holdings, Inc. | 3,434 | 73 | ||||||||||
Home Depot, Inc. | 37,688 | 4,984 | ||||||||||
Interpublic Group of Cos., Inc. | 36,837 | 858 | ||||||||||
Kohl’s Corp. | 38,374 | 1,828 | ||||||||||
L Brands, Inc. | 10,104 | 968 | ||||||||||
Leggett & Platt, Inc. | 2,389 | 100 | ||||||||||
Liberty Interactive Corp. ‘A’ (a) | 26,681 | 729 | ||||||||||
Lowe’s Cos., Inc. | 45,290 | 3,444 | ||||||||||
Macy’s, Inc. | 17,615 | 616 | ||||||||||
Marriott International, Inc. ‘A’ | 1,120 | 75 | ||||||||||
Mattel, Inc. | 35,907 | 976 | ||||||||||
McDonald’s Corp. | 34,653 | 4,094 | ||||||||||
Murphy USA, Inc. (a) | 5,199 | 316 | ||||||||||
NIKE, Inc. ‘B’ | 33,882 | 2,118 | ||||||||||
Nordstrom, Inc. | 6,828 | 340 | ||||||||||
Norwegian Cruise Line Holdings Ltd. (a) | 4,047 | 237 | ||||||||||
O’Reilly Automotive, Inc. (a) | 3,265 | 827 | ||||||||||
Omnicom Group, Inc. | 16,203 | 1,226 | ||||||||||
Outerwall, Inc. | 5,684 | 208 | ||||||||||
Panera Bread Co. ‘A’ (a) | 362 | 70 | ||||||||||
Ralph Lauren Corp. | 4,619 | 515 | ||||||||||
Regal Entertainment Group ‘A’ | 13,872 | 262 | ||||||||||
Rent-A-Center, Inc. | 18,012 | 270 | ||||||||||
Ross Stores, Inc. | 7,134 | 384 | ||||||||||
Royal Caribbean Cruises Ltd. | 5,702 | 577 | ||||||||||
Safeway Casa Ley CVR | 38,866 | 5 | ||||||||||
Safeway PDC LLC CVR | 38,866 | 2 | ||||||||||
Sally Beauty Holdings, Inc. (a) | 5,416 | 151 | ||||||||||
Scholastic Corp. | 2,102 | 81 | ||||||||||
Sears Holdings Corp. (a) | 10,010 | 206 | ||||||||||
SeaWorld Entertainment, Inc. | 27,660 | 545 | ||||||||||
Service Corp. International | 1,838 | 48 | ||||||||||
Six Flags Entertainment Corp. | 1,512 | 83 | ||||||||||
Staples, Inc. | 103,836 | 983 | ||||||||||
Starbucks Corp. | 9,169 | 550 | ||||||||||
Target Corp. | 50,583 | 3,673 | ||||||||||
Tenneco, Inc. (a) | 3,915 | 180 | ||||||||||
Time Warner Cable, Inc. | 20,098 | 3,730 |
SHARES | MARKET VALUE (000S) | |||||||||||
Time Warner, Inc. | 47,114 | $ | 3,047 | |||||||||
Time, Inc. | 23,144 | 363 | ||||||||||
TJX Cos., Inc. | 6,889 | 488 | ||||||||||
Tractor Supply Co. | 1,863 | 159 | ||||||||||
Tribune Media Co. ‘A’ | 8,830 | 298 | ||||||||||
Tupperware Brands Corp. | 7,508 | 418 | ||||||||||
Urban Outfitters, Inc. (a) | 7,417 | 169 | ||||||||||
VF Corp. | 2,508 | 156 | ||||||||||
Viacom, Inc. ‘B’ | 35,026 | 1,442 | ||||||||||
Walt Disney Co. | 23,907 | 2,512 | ||||||||||
Weight Watchers International, Inc. (a) | 28,568 | 651 | ||||||||||
Wendy’s Co. | 14,267 | 154 | ||||||||||
Whirlpool Corp. | 874 | 128 | ||||||||||
Williams-Sonoma, Inc. | 1,201 | 70 | ||||||||||
Wyndham Worldwide Corp. | 8,031 | 583 | ||||||||||
Wynn Resorts Ltd. | 5,526 | 382 | ||||||||||
Yum! Brands, Inc. | 6,004 | 439 | ||||||||||
|
| |||||||||||
73,273 | ||||||||||||
|
| |||||||||||
CONSUMER STAPLES 9.6% | ||||||||||||
Altria Group, Inc. | 41,441 | 2,412 | ||||||||||
Archer-Daniels-Midland Co. | 2,854 | 105 | ||||||||||
Avon Products, Inc. | 110,520 | 448 | ||||||||||
Bunge Ltd. | 5,080 | 347 | ||||||||||
Campbell Soup Co. | 1,120 | 59 | ||||||||||
Casey’s General Stores, Inc. | 1,928 | 232 | ||||||||||
Clorox Co. | 518 | 66 | ||||||||||
Coca-Cola Co. | 69,700 | 2,994 | ||||||||||
Coca-Cola Enterprises, Inc. | 13,539 | 667 | ||||||||||
Colgate-Palmolive Co. | 12,512 | 834 | ||||||||||
ConAgra Foods, Inc. | 18,837 | 794 | ||||||||||
Costco Wholesale Corp. | 6,792 | 1,097 | ||||||||||
CVS Health Corp. | 26,062 | 2,548 | ||||||||||
Dr Pepper Snapple Group, Inc. | 11,881 | 1,107 | ||||||||||
Edgewell Personal Care Co. | 794 | 62 | ||||||||||
Estee Lauder Cos., Inc. ‘A’ | 3,133 | 276 | ||||||||||
General Mills, Inc. | 16,413 | 946 | ||||||||||
Herbalife Ltd. (a) | 15,562 | 834 | ||||||||||
Ingredion, Inc. | 1,223 | 117 | ||||||||||
JM Smucker Co. | 4,003 | 494 | ||||||||||
Kellogg Co. | 6,131 | 443 | ||||||||||
Kimberly-Clark Corp. | 937 | 119 | ||||||||||
Kraft Heinz Co. | 5,690 | 414 | ||||||||||
Kroger Co. | 63,273 | 2,647 | ||||||||||
McCormick & Co., Inc. | 931 | 80 | ||||||||||
Molson Coors Brewing Co. ‘B’ | 1,391 | 131 | ||||||||||
Mondelez International, Inc. ‘A’ | 40,980 | 1,837 | ||||||||||
Monster Beverage Corp. (a) | 1,619 | 241 | ||||||||||
Nu Skin Enterprises, Inc. ‘A’ | 4,908 | 186 | ||||||||||
PepsiCo, Inc. | 36,425 | 3,640 | ||||||||||
Philip Morris International, Inc. | 60,770 | 5,342 | ||||||||||
Procter & Gamble Co. | 65,031 | 5,164 | ||||||||||
Reynolds American, Inc. | 22,294 | 1,029 | ||||||||||
Rite Aid Corp. (a) | 91,372 | 716 | ||||||||||
SUPERVALU, Inc. (a) | 14,115 | 96 | ||||||||||
Sysco Corp. | 20,785 | 852 |
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 51 |
Table of Contents
Schedule of Investments PIMCO RAE Fundamental US Fund (Cont.)
SHARES | MARKET VALUE (000S) | |||||||||||
Universal Corp. | 4,860 | $ | 272 | |||||||||
Wal-Mart Stores, Inc. | 88,705 | 5,438 | ||||||||||
Walgreens Boots Alliance, Inc. | 19,145 | 1,630 | ||||||||||
Whole Foods Market, Inc. | 5,276 | 177 | ||||||||||
|
| |||||||||||
46,893 | ||||||||||||
|
| |||||||||||
ENERGY 9.2% | ||||||||||||
Anadarko Petroleum Corp. | 4,617 | 224 | ||||||||||
Apache Corp. | 8,678 | 386 | ||||||||||
Archrock, Inc. | 2,527 | 19 | ||||||||||
Baker Hughes, Inc. | 6,609 | 305 | ||||||||||
Bill Barrett Corp. (a) | 32,557 | 128 | ||||||||||
California Resources Corp. | 193,993 | 452 | ||||||||||
Cameron International Corp. (a) | 10,194 | 644 | ||||||||||
Chesapeake Energy Corp. | 104,961 | 472 | ||||||||||
Chevron Corp. | 120,485 | 10,839 | ||||||||||
ConocoPhillips | 116,083 | 5,420 | ||||||||||
CONSOL Energy, Inc. | 11,233 | 89 | ||||||||||
Devon Energy Corp. | 10,753 | 344 | ||||||||||
Diamond Offshore Drilling, Inc. | 8,353 | 176 | ||||||||||
Energen Corp. | 5,797 | 238 | ||||||||||
Energy Ltd. | 28,955 | 29 | ||||||||||
EOG Resources, Inc. | 4,180 | 296 | ||||||||||
Exterran Corp. (a) | 1,263 | 20 | ||||||||||
Exxon Mobil Corp. | 177,007 | 13,798 | ||||||||||
Halliburton Co. | 16,325 | 556 | ||||||||||
Hess Corp. | 13,185 | 639 | ||||||||||
HollyFrontier Corp. | 18,084 | 721 | ||||||||||
LinnCo LLC | 14,352 | 15 | ||||||||||
Marathon Oil Corp. | 90,201 | 1,136 | ||||||||||
Marathon Petroleum Corp. | 20,192 | 1,047 | ||||||||||
Murphy Oil Corp. | 23,985 | 538 | ||||||||||
National Oilwell Varco, Inc. | 16,192 | 542 | ||||||||||
Newfield Exploration Co. (a) | 9,761 | 318 | ||||||||||
Occidental Petroleum Corp. | 23,767 | 1,607 | ||||||||||
Patterson-UTI Energy, Inc. | 7,477 | 113 | ||||||||||
Peabody Energy Corp. | 1,013 | 8 | ||||||||||
Phillips 66 | 3,572 | 292 | ||||||||||
Rowan Cos. PLC ‘A’ | 4,292 | 73 | ||||||||||
SandRidge Energy, Inc. (a) | 26,107 | 5 | ||||||||||
Schlumberger Ltd. | 14,423 | 1,006 | ||||||||||
SEACOR Holdings, Inc. (a) | 4,160 | 219 | ||||||||||
Seventy Seven Energy, Inc. (a) | 16,637 | 17 | ||||||||||
Spectra Energy Corp. | 9,285 | 222 | ||||||||||
Stone Energy Corp. (a) | 50,731 | 218 | ||||||||||
Tesoro Corp. | 4,186 | 441 | ||||||||||
Unit Corp. (a) | 8,746 | 107 | ||||||||||
Valero Energy Corp. | 11,010 | 779 | ||||||||||
Whiting Petroleum Corp. (a) | 20,915 | 197 | ||||||||||
WPX Energy, Inc. (a) | 26,363 | 151 | ||||||||||
|
| |||||||||||
44,846 | ||||||||||||
|
| |||||||||||
FINANCIALS 12.3% | ||||||||||||
Aircastle Ltd. | 6,193 | 129 | ||||||||||
Allstate Corp. | 14,291 | 887 | ||||||||||
Ally Financial, Inc. (a) | 9,629 | 179 |
SHARES | MARKET VALUE (000S) | |||||||||||
Ambac Financial Group, Inc. (a) | 11,986 | $ | 169 | |||||||||
American Equity Investment Life Holding Co. | 9,023 | 217 | ||||||||||
American Express Co. | 11,012 | 766 | ||||||||||
American Financial Group, Inc. | 4,410 | 318 | ||||||||||
American International Group, Inc. | 64,103 | 3,972 | ||||||||||
Assurant, Inc. | 6,209 | 500 | ||||||||||
Bank of America Corp. | 323,083 | 5,438 | ||||||||||
Bank of New York Mellon Corp. | 8,662 | 357 | ||||||||||
BB&T Corp. | 13,967 | 528 | ||||||||||
Berkshire Hathaway, Inc. ‘B’ (a) | 3,836 | 507 | ||||||||||
BGC Partners, Inc. ‘A’ | 22,342 | 219 | ||||||||||
Capital One Financial Corp. | 24,242 | 1,750 | ||||||||||
Capitol Federal Financial, Inc. | 11,022 | 138 | ||||||||||
Chubb Corp. | 13,061 | 1,732 | ||||||||||
CIT Group, Inc. | 7,580 | 301 | ||||||||||
Citigroup, Inc. | 87,820 | 4,545 | ||||||||||
Citizens Financial Group, Inc. | 14,749 | 386 | ||||||||||
CME Group, Inc. | 9,374 | 849 | ||||||||||
CoreLogic, Inc. (a) | 4,705 | 159 | ||||||||||
Discover Financial Services | 5,551 | 298 | ||||||||||
E*TRADE Financial Corp. (a) | 8,686 | 257 | ||||||||||
Fifth Third Bancorp | 43,409 | 873 | ||||||||||
First Horizon National Corp. | 23,629 | 343 | ||||||||||
First Niagara Financial Group, Inc. | 31,236 | 339 | ||||||||||
FNF Group | 4,561 | 158 | ||||||||||
Goldman Sachs Group, Inc. | 7,141 | 1,287 | ||||||||||
Great Western Bancorp, Inc. | 5,957 | 173 | ||||||||||
Hartford Financial Services Group, Inc. | 11,490 | 499 | ||||||||||
JPMorgan Chase & Co. | 150,988 | 9,970 | ||||||||||
Kemper Corp. | 3,257 | 121 | ||||||||||
Legg Mason, Inc. | 9,944 | 390 | ||||||||||
Loews Corp. | 13,323 | 512 | ||||||||||
Mastercard, Inc. ‘A’ | 15,953 | 1,553 | ||||||||||
McGraw Hill Financial, Inc. | 4,464 | 440 | ||||||||||
MetLife, Inc. | 1,558 | 75 | ||||||||||
NASDAQ, Inc. | 7,169 | 417 | ||||||||||
New York Community Bancorp, Inc. | 21,095 | 344 | ||||||||||
Northwest Bancshares, Inc. | 7,457 | 100 | ||||||||||
OneMain Holdings, Inc. (a) | 3,675 | 153 | ||||||||||
People’s United Financial, Inc. | 27,991 | 452 | ||||||||||
PHH Corp. (a) | 10,996 | 178 | ||||||||||
PNC Financial Services Group, Inc. | 16,022 | 1,527 | ||||||||||
Primerica, Inc. | 1,945 | 92 | ||||||||||
Progressive Corp. | 5,426 | 173 | ||||||||||
Regions Financial Corp. | 36,020 | 346 | ||||||||||
Reinsurance Group of America, Inc. | 4,165 | 356 | ||||||||||
Santander Consumer USA Holdings, Inc. (a) | 19,619 | 311 | ||||||||||
SLM Corp. (a) | 66,379 | 433 | ||||||||||
StanCorp Financial Group, Inc. | 951 | 108 | ||||||||||
State Street Corp. | 2,994 | 199 | ||||||||||
SunTrust Banks, Inc. | 6,922 | 297 | ||||||||||
Synchrony Financial (a) | 13,884 | 422 | ||||||||||
Travelers Cos., Inc. | 33,626 | 3,795 | ||||||||||
Trustmark Corp. | 7,418 | 171 | ||||||||||
Unum Group | 9,246 | 308 |
SHARES | MARKET VALUE (000S) | |||||||||||
Visa, Inc. ‘A’ | 40,477 | $ | 3,139 | |||||||||
Voya Financial, Inc. | 14,172 | 523 | ||||||||||
Walter Investment Management Corp. (a) | 5,755 | 82 | ||||||||||
Wells Fargo & Co. | 79,299 | 4,311 | ||||||||||
WR Berkley Corp. | 1,263 | 69 | ||||||||||
|
| |||||||||||
59,640 | ||||||||||||
|
| |||||||||||
HEALTH CARE 12.0% | ||||||||||||
Abbott Laboratories | 27,503 | 1,235 | ||||||||||
AbbVie, Inc. | 28,024 | 1,660 | ||||||||||
Aetna, Inc. | 16,625 | 1,798 | ||||||||||
Alere, Inc. (a) | 2,478 | 97 | ||||||||||
Alexion Pharmaceuticals, Inc. (a) | 1,164 | 222 | ||||||||||
AmerisourceBergen Corp. | 3,445 | 357 | ||||||||||
Amgen, Inc. | 20,976 | 3,405 | ||||||||||
Anthem, Inc. | 25,011 | 3,488 | ||||||||||
Baxter International, Inc. | 18,056 | 689 | ||||||||||
Becton Dickinson and Co. | 5,947 | 916 | ||||||||||
Bio-Rad Laboratories, Inc. ‘A’ (a) | 2,971 | 412 | ||||||||||
Biogen, Inc. (a) | 3,222 | 987 | ||||||||||
Boston Scientific Corp. (a) | 33,991 | 627 | ||||||||||
Bristol-Myers Squibb Co. | 37,411 | 2,574 | ||||||||||
Cardinal Health, Inc. | 5,588 | 499 | ||||||||||
Celgene Corp. (a) | 13,747 | 1,646 | ||||||||||
Centene Corp. (a) | 2,820 | 186 | ||||||||||
Cerner Corp. (a) | 1,342 | 81 | ||||||||||
Charles River Laboratories International, Inc. (a) | 1,584 | 127 | ||||||||||
Cigna Corp. | 2,667 | 390 | ||||||||||
Community Health Systems, Inc. (a) | 19,924 | 529 | ||||||||||
CR Bard, Inc. | 2,501 | 474 | ||||||||||
DaVita HealthCare Partners, Inc. (a) | 1,553 | 108 | ||||||||||
Edwards Lifesciences Corp. (a) | 4,230 | 334 | ||||||||||
Eli Lilly & Co. | 30,228 | 2,547 | ||||||||||
Envision Healthcare Holdings, Inc. (a) | 7,597 | 197 | ||||||||||
Express Scripts Holding Co. (a) | 10,970 | 959 | ||||||||||
Gilead Sciences, Inc. | 20,391 | 2,063 | ||||||||||
Halyard Health, Inc. (a) | 7,356 | 246 | ||||||||||
HCA Holdings, Inc. (a) | 38,010 | 2,571 | ||||||||||
Health Net, Inc. (a) | 8,384 | 574 | ||||||||||
Henry Schein, Inc. (a) | 1,213 | 192 | ||||||||||
Hologic, Inc. (a) | 2,541 | 98 | ||||||||||
Humana, Inc. | 5,227 | 933 | ||||||||||
Illumina, Inc. (a) | 985 | 189 | ||||||||||
Intuitive Surgical, Inc. (a) | 154 | 84 | ||||||||||
Johnson & Johnson | 48,611 | 4,993 | ||||||||||
Kindred Healthcare, Inc. | 13,767 | 164 | ||||||||||
Laboratory Corp. of America Holdings (a) | 580 | 72 | ||||||||||
LifePoint Hospitals, Inc. (a) | 4,527 | 332 | ||||||||||
Magellan Health, Inc. (a) | 5,564 | 343 | ||||||||||
Mallinckrodt PLC (a) | 1,214 | 91 | ||||||||||
McKesson Corp. | 3,662 | 722 | ||||||||||
MEDNAX, Inc. (a) | 704 | 50 | ||||||||||
Merck & Co., Inc. | 56,889 | 3,005 |
52 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
SHARES | MARKET VALUE (000S) | |||||||||||
Mettler-Toledo International, Inc. (a) | 235 | $ | 80 | |||||||||
Mylan NV (a) | 3,855 | 208 | ||||||||||
Owens & Minor, Inc. | 5,199 | 187 | ||||||||||
Patterson Cos., Inc. | 5,804 | 262 | ||||||||||
Pfizer, Inc. | 201,503 | 6,505 | ||||||||||
Quest Diagnostics, Inc. | 19,881 | 1,414 | ||||||||||
Quintiles Transnational Holdings, Inc. (a) | 1,168 | 80 | ||||||||||
Regeneron Pharmaceuticals, Inc. (a) | 788 | 428 | ||||||||||
St Jude Medical, Inc. | 9,009 | 557 | ||||||||||
Stryker Corp. | 3,796 | 353 | ||||||||||
Tenet Healthcare Corp. (a) | 3,164 | 96 | ||||||||||
Thermo Fisher Scientific, Inc. | 1,434 | 203 | ||||||||||
United Therapeutics Corp. (a) | 1,037 | 162 | ||||||||||
UnitedHealth Group, Inc. | 29,259 | 3,442 | ||||||||||
Universal Health Services, Inc. ‘B’ | 2,570 | 307 | ||||||||||
VCA, Inc. (a) | 1,781 | 98 | ||||||||||
WellCare Health Plans, Inc. (a) | 2,724 | 213 | ||||||||||
Zimmer Biomet Holdings, Inc. | 4,236 | 435 | ||||||||||
Zoetis, Inc. | 6,746 | 323 | ||||||||||
|
| |||||||||||
58,619 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 7.6% | ||||||||||||
3M Co. | 11,465 | 1,727 | ||||||||||
ADT Corp. | 24,572 | 810 | ||||||||||
AGCO Corp. | 8,617 | 391 | ||||||||||
Alaska Air Group, Inc. | 4,416 | 356 | ||||||||||
Avis Budget Group, Inc. (a) | 4,096 | 149 | ||||||||||
Boeing Co. | 8,026 | 1,160 | ||||||||||
Brink’s Co. | 4,303 | 124 | ||||||||||
Caterpillar, Inc. | 20,165 | 1,370 | ||||||||||
CH Robinson Worldwide, Inc. | 2,019 | 125 | ||||||||||
Cintas Corp. | 1,350 | 123 | ||||||||||
Civeo Corp. | 24,494 | 35 | ||||||||||
Clean Harbors, Inc. (a) | 1,848 | 77 | ||||||||||
CSX Corp. | 40,557 | 1,052 | ||||||||||
Cummins, Inc. | 1,392 | 123 | ||||||||||
Danaher Corp. | 9,069 | 842 | ||||||||||
Deere & Co. | 24,539 | 1,872 | ||||||||||
Delta Air Lines, Inc. | 2,375 | 120 | ||||||||||
Dover Corp. | 5,273 | 323 | ||||||||||
Dun & Bradstreet Corp. | 4,054 | 421 | ||||||||||
Emerson Electric Co. | 26,874 | 1,285 | ||||||||||
Equifax, Inc. | 1,083 | 121 | ||||||||||
Essendant, Inc. | 2,232 | 73 | ||||||||||
FedEx Corp. | 1,304 | 194 | ||||||||||
Flowserve Corp. | 880 | 37 | ||||||||||
Fluor Corp. | 6,976 | 329 | ||||||||||
FTI Consulting, Inc. (a) | 4,725 | 164 | ||||||||||
GATX Corp. | 3,476 | 148 | ||||||||||
General Dynamics Corp. | 5,663 | 778 | ||||||||||
General Electric Co. | 166,130 | 5,175 | ||||||||||
Harsco Corp. | 9,544 | 75 | ||||||||||
HD Supply Holdings, Inc. (a) | 2,680 | 81 | ||||||||||
Hertz Global Holdings, Inc. (a) | 19,860 | 283 |
SHARES | MARKET VALUE (000S) | |||||||||||
Honeywell International, Inc. | 9,262 | $ | 959 | |||||||||
Illinois Tool Works, Inc. | 10,023 | 929 | ||||||||||
Ingersoll-Rand PLC | 6,040 | 334 | ||||||||||
Jacobs Engineering Group, Inc. (a) | 984 | 41 | ||||||||||
JetBlue Airways Corp. (a) | 33,052 | 749 | ||||||||||
KBR, Inc. | 24,555 | 415 | ||||||||||
KLX, Inc. (a) | 10,007 | 308 | ||||||||||
L-3 Communications Holdings, Inc. | 3,197 | 382 | ||||||||||
Lockheed Martin Corp. | 5,457 | 1,185 | ||||||||||
ManpowerGroup, Inc. | 1,469 | 124 | ||||||||||
Norfolk Southern Corp. | 10,789 | 913 | ||||||||||
Northrop Grumman Corp. | 12,386 | 2,339 | ||||||||||
Orbital ATK, Inc. | 1,015 | 91 | ||||||||||
Owens Corning | 2,603 | 122 | ||||||||||
PACCAR, Inc. | 1,269 | 60 | ||||||||||
Parker-Hannifin Corp. | 1,833 | 178 | ||||||||||
Raytheon Co. | 12,384 | 1,542 | ||||||||||
Republic Services, Inc. | 13,960 | 614 | ||||||||||
Rexnord Corp. (a) | 3,930 | 71 | ||||||||||
Rockwell Collins, Inc. | 2,382 | 220 | ||||||||||
RR Donnelley & Sons Co. | 27,360 | 403 | ||||||||||
Ryder System, Inc. | 3,092 | 176 | ||||||||||
SkyWest, Inc. | 14,365 | 273 | ||||||||||
Snap-on, Inc. | 465 | 80 | ||||||||||
Southwest Airlines Co. | 4,352 | 187 | ||||||||||
SPX Corp. | 3,968 | 37 | ||||||||||
Tidewater, Inc. | 4,497 | 31 | ||||||||||
Timken Co. | 5,061 | 145 | ||||||||||
Towers Watson & Co. ‘A’ | 982 | 126 | ||||||||||
TransDigm Group, Inc. (a) | 679 | 155 | ||||||||||
Union Pacific Corp. | 13,199 | 1,032 | ||||||||||
United Continental Holdings, Inc. (a) | 3,382 | 194 | ||||||||||
United Parcel Service, Inc. ‘B’ | 1,181 | 114 | ||||||||||
United Technologies Corp. | 14,145 | 1,359 | ||||||||||
Waste Management, Inc. | 20,328 | 1,085 | ||||||||||
WESCO International, Inc. (a) | 1,665 | 73 | ||||||||||
WW Grainger, Inc. | 399 | 81 | ||||||||||
YRC Worldwide, Inc. (a) | 3,065 | 43 | ||||||||||
|
| |||||||||||
37,113 | ||||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 19.9% | ||||||||||||
Activision Blizzard, Inc. | 53,652 | 2,077 | ||||||||||
Alphabet, Inc. ‘A’ (a) | 1,319 | 1,026 | ||||||||||
Alphabet, Inc. ‘C’ (a) | 7,327 | 5,560 | ||||||||||
Amdocs Ltd. | 7,937 | 433 | ||||||||||
Analog Devices, Inc. | 1,107 | 61 | ||||||||||
Anixter International, Inc. (a) | 6,247 | 377 | ||||||||||
Apple, Inc. | 105,814 | 11,138 | ||||||||||
Applied Materials, Inc. | 5,526 | 103 | ||||||||||
Arrow Electronics, Inc. (a) | 11,167 | 605 | ||||||||||
Automatic Data Processing, Inc. | 6,759 | 573 | ||||||||||
Avnet, Inc. | 17,893 | 767 | ||||||||||
Booz Allen Hamilton Holding Corp. | 21,145 | 652 | ||||||||||
Broadcom Corp. ‘A’ | 8,302 | 480 |
SHARES | MARKET VALUE (000S) | |||||||||||
Broadridge Financial Solutions, Inc. | 3,216 | $ | 173 | |||||||||
Brocade Communications Systems, Inc. | 19,453 | 179 | ||||||||||
CA, Inc. | 33,835 | 966 | ||||||||||
CACI International, Inc. ‘A’ (a) | 3,733 | 346 | ||||||||||
CDW Corp. | 1,196 | 50 | ||||||||||
Cisco Systems, Inc. | 215,919 | 5,863 | ||||||||||
Citrix Systems, Inc. (a) | 1,736 | 131 | ||||||||||
Cognizant Technology Solutions Corp. ‘A’ (a) | 9,105 | 546 | ||||||||||
CommScope Holding Co., Inc. (a) | 2,797 | 72 | ||||||||||
Convergys Corp. | 8,549 | 213 | ||||||||||
Corning, Inc. | 66,941 | 1,224 | ||||||||||
CSRA, Inc. | 2,760 | 83 | ||||||||||
Diebold, Inc. | 3,544 | 107 | ||||||||||
DST Systems, Inc. | 839 | 96 | ||||||||||
eBay, Inc. (a) | 15,212 | 418 | ||||||||||
EchoStar Corp. ‘A’ (a) | 1,835 | 72 | ||||||||||
Electronic Arts, Inc. (a) | 7,005 | 481 | ||||||||||
EMC Corp. | 70,944 | 1,822 | ||||||||||
Facebook, Inc. ‘A’ (a) | 6,218 | 651 | ||||||||||
Fairchild Semiconductor International, Inc. (a) | 5,415 | 112 | ||||||||||
Fidelity National Information Services, Inc. | 7,534 | 457 | ||||||||||
Fiserv, Inc. (a) | 5,138 | 470 | ||||||||||
Flextronics International Ltd. (a) | 26,750 | 300 | ||||||||||
FLIR Systems, Inc. | 2,643 | 74 | ||||||||||
Global Payments, Inc. | 5,543 | 358 | ||||||||||
Harris Corp. | 6,971 | 606 | ||||||||||
Hewlett Packard Enterprise Co. | 235,189 | 3,575 | ||||||||||
HP, Inc. | 208,260 | 2,466 | ||||||||||
Ingram Micro, Inc. ‘A’ | 17,659 | 536 | ||||||||||
Intel Corp. | 256,417 | 8,834 | ||||||||||
InterActiveCorp | 8,477 | 509 | ||||||||||
International Business Machines Corp. | 81,197 | 11,174 | ||||||||||
Intuit, Inc. | 4,942 | 477 | ||||||||||
Jabil Circuit, Inc. | 23,388 | 545 | ||||||||||
Juniper Networks, Inc. | 34,557 | 954 | ||||||||||
Keysight Technologies, Inc. (a) | 8,260 | 234 | ||||||||||
KLA-Tencor Corp. | 4,129 | 286 | ||||||||||
Lam Research Corp. | 3,592 | 285 | ||||||||||
Leidos Holdings, Inc. | 7,157 | 403 | ||||||||||
Lexmark International, Inc. ‘A’ | 19,219 | 624 | ||||||||||
Maxim Integrated Products, Inc. | 14,099 | 536 | ||||||||||
Microsoft Corp. | 173,123 | 9,605 | ||||||||||
Motorola Solutions, Inc. | 18,490 | 1,266 | ||||||||||
NCR Corp. (a) | 4,904 | 120 | ||||||||||
NetApp, Inc. | 18,587 | 493 | ||||||||||
NeuStar, Inc. ‘A’ (a) | 14,020 | 336 | ||||||||||
NVIDIA Corp. | 5,806 | 191 | ||||||||||
ON Semiconductor Corp. (a) | 3,847 | 38 | ||||||||||
Oracle Corp. | 95,455 | 3,487 | ||||||||||
Paychex, Inc. | 4,173 | 221 | ||||||||||
Pitney Bowes, Inc. | 23,701 | 489 | ||||||||||
Polycom, Inc. (a) | 36,520 | 460 | ||||||||||
QLogic Corp. (a) | 30,632 | 374 |
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 53 |
Table of Contents
Schedule of Investments PIMCO RAE Fundamental US Fund (Cont.)
SHARES | MARKET VALUE (000S) | |||||||||||
QUALCOMM, Inc. | 17,535 | $ | 876 | |||||||||
Red Hat, Inc. (a) | 970 | 80 | ||||||||||
Rovi Corp. (a) | 8,122 | 135 | ||||||||||
SanDisk Corp. | 1,686 | 128 | ||||||||||
Seagate Technology PLC | 23,637 | 867 | ||||||||||
Skyworks Solutions, Inc. | 2,127 | 163 | ||||||||||
Symantec Corp. | 58,373 | 1,226 | ||||||||||
SYNNEX Corp. | 583 | 52 | ||||||||||
Synopsys, Inc. (a) | 2,860 | 130 | ||||||||||
Take-Two Interactive Software, Inc. (a) | 5,703 | 199 | ||||||||||
Tech Data Corp. (a) | 7,425 | 493 | ||||||||||
Teradata Corp. (a) | 13,247 | 350 | ||||||||||
Teradyne, Inc. | 5,069 | 105 | ||||||||||
Texas Instruments, Inc. | 23,989 | 1,315 | ||||||||||
Total System Services, Inc. | 1,430 | 71 | ||||||||||
Unisys Corp. (a) | 12,089 | 134 | ||||||||||
Vishay Intertechnology, Inc. | 31,690 | 382 | ||||||||||
Western Digital Corp. | 1,888 | 113 | ||||||||||
Western Union Co. | 61,458 | 1,101 | ||||||||||
Xerox Corp. | 72,746 | 773 | ||||||||||
Yahoo!, Inc. (a) | 5,778 | 192 | ||||||||||
Zynga, Inc. ‘A’ (a) | 31,008 | 83 | ||||||||||
|
| |||||||||||
97,208 | ||||||||||||
|
| |||||||||||
MATERIALS 1.7% | ||||||||||||
Air Products & Chemicals, Inc. | 2,510 | 327 | ||||||||||
Airgas, Inc. | 3,176 | 439 | ||||||||||
Alcoa, Inc. | 17,516 | 173 | ||||||||||
Armstrong World Industries, Inc. (a) | 13,455 | 615 | ||||||||||
Ashland, Inc. | 1,983 | 204 | ||||||||||
Ball Corp. | 3,547 | 258 | ||||||||||
Bemis Co., Inc. | 4,594 | 205 | ||||||||||
Berry Plastics Group, Inc. (a) | 2,199 | 79 | ||||||||||
CF Industries Holdings, Inc. | 10,845 | 443 | ||||||||||
Commercial Metals Co. | 3,881 | 53 | ||||||||||
Dow Chemical Co. | 17,772 | 915 | ||||||||||
E.I. du Pont de Nemours & Co. | 15,244 | 1,015 | ||||||||||
Freeport-McMoRan, Inc. | 40,627 | 275 | ||||||||||
Greif, Inc. ‘A’ | 2,357 | 73 | ||||||||||
LyondellBasell Industries NV ‘A’ | 6,640 | 577 | ||||||||||
Monsanto Co. | 5,508 | 543 | ||||||||||
Mosaic Co. | 16,481 | 455 | ||||||||||
Newmont Mining Corp. | 44,484 | 800 | ||||||||||
Owens-Illinois, Inc. (a) | 2,418 | 42 | ||||||||||
PPG Industries, Inc. | 2,035 | 201 | ||||||||||
Praxair, Inc. | 2,495 | 255 |
SHARES | MARKET VALUE (000S) | |||||||||||
Sherwin-Williams Co. | 1,389 | $ | 361 | |||||||||
Sonoco Products Co. | 1,511 | 62 | ||||||||||
|
| |||||||||||
8,370 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 5.4% | ||||||||||||
AT&T, Inc. | 444,294 | 15,288 | ||||||||||
CenturyLink, Inc. | 83,965 | 2,113 | ||||||||||
Contra Leap Wireless | 22,373 | 56 | ||||||||||
Frontier Communications Corp. | 262,004 | 1,224 | ||||||||||
T-Mobile US, Inc. (a) | 5,965 | 233 | ||||||||||
Telephone & Data Systems, Inc. | 13,279 | 344 | ||||||||||
Verizon Communications, Inc. | 138,954 | 6,422 | ||||||||||
West Corp. | 4,381 | 95 | ||||||||||
Windstream Holdings, Inc. | 76,040 | 490 | ||||||||||
|
| |||||||||||
26,265 | ||||||||||||
|
| |||||||||||
UTILITIES 5.7% | ||||||||||||
AES Corp. | 20,258 | 194 | ||||||||||
AGL Resources, Inc. | 1,754 | 112 | ||||||||||
Alliant Energy Corp. | 857 | 54 | ||||||||||
Ameren Corp. | 22,757 | 984 | ||||||||||
American Electric Power Co., Inc. | 22,875 | 1,333 | ||||||||||
Atmos Energy Corp. | 1,642 | 103 | ||||||||||
Avista Corp. | 6,248 | 221 | ||||||||||
Calpine Corp. (a) | 26,920 | 390 | ||||||||||
CenterPoint Energy, Inc. | 36,430 | 669 | ||||||||||
CMS Energy Corp. | 17,168 | 619 | ||||||||||
Consolidated Edison, Inc. | 30,887 | 1,985 | ||||||||||
Dominion Resources, Inc. | 6,404 | 433 | ||||||||||
DTE Energy Co. | 12,106 | 971 | ||||||||||
Duke Energy Corp. | 21,907 | 1,564 | ||||||||||
Edison International | 16,442 | 974 | ||||||||||
El Paso Electric Co. | 5,193 | 200 | ||||||||||
Entergy Corp. | 25,754 | 1,761 | ||||||||||
Exelon Corp. | 49,464 | 1,374 | ||||||||||
FirstEnergy Corp. | 34,097 | 1,082 | ||||||||||
Great Plains Energy, Inc. | 10,672 | 291 | ||||||||||
MDU Resources Group, Inc. | 30,620 | 561 | ||||||||||
NextEra Energy, Inc. | 8,164 | 848 | ||||||||||
NiSource, Inc. | 10,984 | 214 | ||||||||||
ONE Gas, Inc. | 5,086 | 255 | ||||||||||
Pepco Holdings, Inc. | 22,262 | 579 | ||||||||||
PG&E Corp. | 23,251 | 1,237 | ||||||||||
Pinnacle West Capital Corp. | 11,229 | 724 | ||||||||||
PNM Resources, Inc. | 10,631 | 325 | ||||||||||
Portland General Electric Co. | 4,788 | 174 | ||||||||||
PPL Corp. | 20,029 | 684 |
SHARES | MARKET VALUE (000S) | |||||||||||
Public Service Enterprise Group, Inc. | 33,937 | $ | 1,313 | |||||||||
SCANA Corp. | 6,233 | 377 | ||||||||||
Sempra Energy | 4,513 | 424 | ||||||||||
Southern Co. | 40,151 | 1,879 | ||||||||||
Southwest Gas Corp. | 4,410 | 243 | ||||||||||
TECO Energy, Inc. | 28,612 | 762 | ||||||||||
UGI Corp. | 4,133 | 140 | ||||||||||
Vectren Corp. | 7,049 | 299 | ||||||||||
WEC Energy Group, Inc. | 3,418 | 175 | ||||||||||
Westar Energy, Inc. | 9,700 | 411 | ||||||||||
WGL Holdings, Inc. | 2,656 | 167 | ||||||||||
Xcel Energy, Inc. | 22,383 | 804 | ||||||||||
|
| |||||||||||
27,909 | ||||||||||||
|
| |||||||||||
Total United States | 480,136 | |||||||||||
|
| |||||||||||
Total Common Stocks (Cost $413,167) | 481,828 | |||||||||||
|
| |||||||||||
REAL ESTATE INVESTMENT TRUSTS 0.9% | ||||||||||||
UNITED STATES 0.9% | ||||||||||||
FINANCIALS 0.9% | ||||||||||||
American Capital Agency Corp. | 20,731 | 360 | ||||||||||
Annaly Capital Management, Inc. | 147,650 | 1,385 | ||||||||||
Columbia Property Trust, Inc. | 11,383 | 267 | ||||||||||
Corrections Corp. of America | 9,408 | 249 | ||||||||||
Digital Realty Trust, Inc. | 1,472 | 111 | ||||||||||
Hatteras Financial Corp. | 18,879 | 248 | ||||||||||
Iron Mountain, Inc. | 23,062 | 623 | ||||||||||
Mack-Cali Realty Corp. | 2,187 | 51 | ||||||||||
MFA Financial, Inc. | 15,120 | 100 | ||||||||||
New Residential Investment Corp. | 12,321 | 150 | ||||||||||
Outfront Media, Inc. | 11,731 | 256 | ||||||||||
Piedmont Office Realty Trust, Inc. ‘A’ | 10,291 | 194 | ||||||||||
Simon Property Group, Inc. | 1,203 | 234 | ||||||||||
Two Harbors Investment Corp. | 6,265 | 51 | ||||||||||
|
| |||||||||||
4,279 | ||||||||||||
|
| |||||||||||
Total Real Estate Investment Trusts |
| 4,279 | ||||||||||
|
| |||||||||||
Total Investments in Securities (Cost $417,979) | 486,107 | |||||||||||
Total Investments 99.6% (Cost $417,979) | $ | 486,107 | ||||||||||
Other Assets and Liabilities, net 0.4% | 1,877 | |||||||||||
|
| |||||||||||
Net Assets 100.0% | $ | 487,984 | ||||||||||
|
|
NOTES TO SCHEDULE OF INVESTMENTS (AMOUNTS IN THOUSANDS*):
* | A zero balance may reflect actual amounts rounding to less than one thousand. |
(a) | Security did not produce income within the last twelve months. |
54 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
FAIR VALUE MEASUREMENTS
The following is a summary of the fair valuations according to the inputs used as of December 31, 2015 in valuing the Fund’s assets and liabilities:
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Investments in Securities, at Value | ||||||||||||||||
Common Stocks | ||||||||||||||||
Ireland | ||||||||||||||||
Financials | $ | 98 | $ | 0 | $ | 0 | $ | 98 | ||||||||
Information Technology | 1,508 | 0 | 0 | 1,508 | ||||||||||||
Peru | ||||||||||||||||
Materials | 86 | 0 | 0 | 86 | ||||||||||||
United States | ||||||||||||||||
Consumer Discretionary | 73,266 | 0 | 7 | 73,273 | ||||||||||||
Consumer Staples | 46,893 | 0 | 0 | 46,893 | ||||||||||||
Energy | 44,846 | 0 | 0 | 44,846 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Financials | $ | 59,640 | $ | 0 | $ | 0 | $ | 59,640 | ||||||||
Health Care | 58,619 | 0 | 0 | 58,619 | ||||||||||||
Industrials | 37,113 | 0 | 0 | 37,113 | ||||||||||||
Information Technology | 97,208 | 0 | 0 | 97,208 | ||||||||||||
Materials | 8,370 | 0 | 0 | 8,370 | ||||||||||||
Telecommunication Services | 26,209 | 0 | 56 | 26,265 | ||||||||||||
Utilities | 27,909 | 0 | 0 | 27,909 | ||||||||||||
Real Estate Investment Trusts | ||||||||||||||||
United States | ||||||||||||||||
Financials | 4,279 | 0 | 0 | 4,279 | ||||||||||||
Total Investments | $ | 486,044 | $ | 0 | $ | 63 | $ | 486,107 |
There were no significant transfers between Levels 1, 2, or 3 during the period ended December 31, 2015.
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 55 |
Table of Contents
Schedule of Investments PIMCO RAE Fundamental US Small Fund
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN SECURITIES 99.6% | ||||||||||||
COMMON STOCKS 95.2% | ||||||||||||
UNITED KINGDOM 0.1% | ||||||||||||
HEALTH CARE 0.1% | ||||||||||||
LivaNova PLC (a) | 1,358 | $ | 81 | |||||||||
|
| |||||||||||
MATERIALS 0.0% | ||||||||||||
Ferroglobe PLC | 2,716 | 29 | ||||||||||
|
| |||||||||||
Total United Kingdom | 110 | |||||||||||
|
| |||||||||||
UNITED STATES 95.1% | ||||||||||||
CONSUMER DISCRETIONARY 19.9% | ||||||||||||
1-800-Flowers.com, Inc. ‘A’ (a) | 6,880 | 50 | ||||||||||
2U, Inc. (a) | 707 | 20 | ||||||||||
A H Belo Corp. ‘A’ | 667 | 3 | ||||||||||
Aeropostale, Inc. (a) | 5,027 | 1 | ||||||||||
AMC Entertainment Holdings, Inc. ‘A’ | 9,534 | 229 | ||||||||||
America’s Car-Mart, Inc. (a) | 2,330 | 62 | ||||||||||
American Axle & Manufacturing Holdings, Inc. (a) | 2,464 | 47 | ||||||||||
American Public Education, Inc. (a) | 6,060 | 113 | ||||||||||
Arctic Cat, Inc. | 4,873 | 80 | ||||||||||
Asbury Automotive Group, Inc. (a) | 2,176 | 147 | ||||||||||
Ascent Capital Group, Inc. ‘A’ (a) | 4,536 | 76 | ||||||||||
Barnes & Noble, Inc. | 20,404 | 178 | ||||||||||
Bassett Furniture Industries, Inc. | 3,373 | 85 | ||||||||||
bebe stores, Inc. | 17,042 | 10 | ||||||||||
Big 5 Sporting Goods Corp. | 10,765 | 108 | ||||||||||
Biglari Holdings, Inc. (a) | 98 | 32 | ||||||||||
BJ’s Restaurants, Inc. (a) | 5,290 | 230 | ||||||||||
Blue Nile, Inc. (a) | 1,273 | 47 | ||||||||||
Boot Barn Holdings, Inc. (a) | 488 | 6 | ||||||||||
Boyd Gaming Corp. (a) | 30,805 | 612 | ||||||||||
Bravo Brio Restaurant Group, Inc. (a) | 6,130 | 55 | ||||||||||
Bridgepoint Education, Inc. (a) | 6,591 | 50 | ||||||||||
Bright Horizons Family Solutions, Inc. (a) | 2,018 | 135 | ||||||||||
Buckle, Inc. | 11,552 | 356 | ||||||||||
Build-A-Bear Workshop, Inc. (a) | 3,392 | 41 | ||||||||||
CalAtlantic Group, Inc. | 532 | 20 | ||||||||||
Caleres, Inc. | 12,132 | 325 | ||||||||||
Callaway Golf Co. | 11,060 | 104 | ||||||||||
Capella Education Co. | 5,696 | 263 | ||||||||||
Career Education Corp. (a) | 18,783 | 68 | ||||||||||
Carrols Restaurant Group, Inc. (a) | 17,421 | 204 | ||||||||||
Cato Corp. ‘A’ | 6,681 | 246 | ||||||||||
Cheesecake Factory, Inc. | 3,347 | 154 | ||||||||||
Chegg, Inc. (a) | 4,120 | 28 | ||||||||||
Children’s Place, Inc. | 8,205 | 453 | ||||||||||
Choice Hotels International, Inc. | 5,446 | 275 | ||||||||||
Christopher & Banks Corp. (a) | 8,699 | 14 | ||||||||||
Churchill Downs, Inc. | 406 | 57 | ||||||||||
Citi Trends, Inc. | 7,495 | 159 | ||||||||||
Clear Channel Outdoor Holdings, Inc. ‘A’ (a) | 9,912 | 55 | ||||||||||
ClubCorp Holdings, Inc. | 5,594 | 102 | ||||||||||
Collectors Universe, Inc. | 952 | 15 |
SHARES | MARKET VALUE (000S) | |||||||||||
Columbia Sportswear Co. | 3,897 | $ | 190 | |||||||||
Conn’s, Inc. (a) | 5,392 | 127 | ||||||||||
Container Store Group, Inc. (a) | 10,435 | 86 | ||||||||||
Cooper-Standard Holding, Inc. (a) | 3,004 | 233 | ||||||||||
Core-Mark Holding Co., Inc. | 3,690 | 302 | ||||||||||
Crocs, Inc. (a) | 32,720 | 335 | ||||||||||
Crown Media Holdings, Inc. (a) | 3,585 | 20 | ||||||||||
CSS Industries, Inc. | 1,910 | 54 | ||||||||||
Cumulus Media, Inc. ‘A’ (a) | 11,787 | 4 | ||||||||||
Dave & Buster’s Entertainment, Inc. (a) | 2,484 | 104 | ||||||||||
Del Frisco’s Restaurant Group, Inc. (a) | 995 | 16 | ||||||||||
Denny’s Corp. (a) | 20,628 | 203 | ||||||||||
Destination Maternity Corp. | 4,309 | 38 | ||||||||||
Destination XL Group, Inc. (a) | 13,394 | 74 | ||||||||||
Diamond Resorts International, Inc. (a) | 4,324 | 110 | ||||||||||
DineEquity, Inc. | 2,315 | 196 | ||||||||||
Dorman Products, Inc. (a) | 410 | 19 | ||||||||||
DreamWorks Animation SKG, Inc. ‘A’ (a) | 2,895 | 75 | ||||||||||
Drew Industries, Inc. | 971 | 59 | ||||||||||
El Pollo Loco Holdings, Inc. (a) | 2,532 | 32 | ||||||||||
Entercom Communications Corp. ‘A’ (a) | 4,385 | 49 | ||||||||||
Eros International PLC (a) | 4,410 | 40 | ||||||||||
Ethan Allen Interiors, Inc. | 3,347 | 93 | ||||||||||
EVINE Live, Inc. (a) | 8,647 | 15 | ||||||||||
EW Scripps Co. ‘A’ | 2,532 | 48 | ||||||||||
Express, Inc. (a) | 14,191 | 245 | ||||||||||
Extended Stay America, Inc. | 6,001 | 95 | ||||||||||
Famous Dave’s of America, Inc. (a) | 822 | 6 | ||||||||||
Federal-Mogul Holdings Corp. (a) | 1,869 | 13 | ||||||||||
Fiesta Restaurant Group, Inc. (a) | 2,330 | 78 | ||||||||||
Finish Line, Inc. ‘A’ | 21,450 | 388 | ||||||||||
Five Below, Inc. (a) | 1,073 | 34 | ||||||||||
Flexsteel Industries, Inc. | 963 | 43 | ||||||||||
Francesca’s Holdings Corp. (a) | 5,143 | 90 | ||||||||||
Fred’s, Inc. | 11,223 | 184 | ||||||||||
FTD Cos., Inc. (a) | 4,629 | 121 | ||||||||||
Fuel Systems Solutions, Inc. (a) | 6,799 | 33 | ||||||||||
G-III Apparel Group Ltd. (a) | 938 | 41 | ||||||||||
GoPro, Inc. ‘A’ (a) | 1,373 | 25 | ||||||||||
Grand Canyon Education, Inc. (a) | 263 | 11 | ||||||||||
Groupon, Inc. (a) | 28,278 | 87 | ||||||||||
Harte-Hanks, Inc. | 10,286 | 33 | ||||||||||
Haverty Furniture Cos., Inc. | 5,365 | 115 | ||||||||||
hhgregg, Inc. (a) | 7,294 | 27 | ||||||||||
Hibbett Sports, Inc. (a) | 4,591 | 139 | ||||||||||
Hooker Furniture Corp. | 2,700 | 68 | ||||||||||
Houghton Mifflin Harcourt Co. (a) | 5,005 | 109 | ||||||||||
HSN, Inc. | 3,510 | 178 | ||||||||||
Hyatt Hotels Corp. ‘A’ (a) | 2,927 | 138 | ||||||||||
Iconix Brand Group, Inc. (a) | 3,397 | 23 | ||||||||||
Installed Building Products, Inc. (a) | 868 | 22 | ||||||||||
International Speedway Corp. ‘A’ | 5,856 | 197 | ||||||||||
Interval Leisure Group, Inc. | 2,902 | 45 |
SHARES | MARKET VALUE (000S) | |||||||||||
Isle of Capri Casinos, Inc. (a) | 14,228 | $ | 198 | |||||||||
Jamba, Inc. (a) | 2,765 | 37 | ||||||||||
Jindal Steel & Power Ltd. (a) | 23,507 | 187 | ||||||||||
Johnson Outdoors, Inc. ‘A’ | 189 | 4 | ||||||||||
K12, Inc. (a) | 12,437 | 109 | ||||||||||
Kirkland’s, Inc. | 3,909 | 57 | ||||||||||
La Quinta Holdings, Inc. (a) | 3,928 | 53 | ||||||||||
La-Z-Boy, Inc. | 1,609 | 39 | ||||||||||
Lands’ End, Inc. (a) | 18,629 | 437 | ||||||||||
Lee Enterprises, Inc. (a) | 14,752 | 25 | ||||||||||
LGI Homes, Inc. (a) | 645 | 16 | ||||||||||
Libbey, Inc. | 4,972 | 106 | ||||||||||
Liberty TripAdvisor Holdings, Inc. ‘A’ (a) | 11,912 | 361 | ||||||||||
LifeLock, Inc. (a) | 3,010 | 43 | ||||||||||
Lifetime Brands, Inc. | 380 | 5 | ||||||||||
Lions Gate Entertainment Corp. | 881 | 29 | ||||||||||
Lithia Motors, Inc. ‘A’ | 207 | 22 | ||||||||||
Loral Space & Communications, Inc. (a) | 2,076 | 84 | ||||||||||
Lumber Liquidators Holdings, Inc. (a) | 11,067 | 192 | ||||||||||
Marcus Corp. | 4,741 | 90 | ||||||||||
Marriott Vacations Worldwide Corp. | 3,564 | 203 | ||||||||||
Mattress Firm Holding Corp. (a) | 1,732 | 77 | ||||||||||
MDC Holdings, Inc. | 1,046 | 27 | ||||||||||
Meritage Homes Corp. (a) | 2,581 | 88 | ||||||||||
Metaldyne Performance Group, Inc. | 1,469 | 27 | ||||||||||
Michaels Cos., Inc. (a) | 9,957 | 220 | ||||||||||
Modine Manufacturing Co. (a) | 5,195 | 47 | ||||||||||
Monarch Casino & Resort, Inc. (a) | 2,074 | 47 | ||||||||||
Monro Muffler Brake, Inc. | 2,068 | 137 | ||||||||||
Movado Group, Inc. | 4,812 | 124 | ||||||||||
MSG Networks, Inc. ‘A’ (a) | 956 | 20 | ||||||||||
NACCO Industries, Inc. ‘A’ | 1,435 | 61 | ||||||||||
National CineMedia, Inc. | 15,801 | 248 | ||||||||||
Nautilus, Inc. (a) | 2,311 | 39 | ||||||||||
Nexstar Broadcasting Group, Inc. ‘A’ | 1,123 | 66 | ||||||||||
Noodles & Co. (a) | 4,088 | 40 | ||||||||||
Nutrisystem, Inc. | 8,764 | 190 | ||||||||||
Overstock.com, Inc. (a) | 2,082 | 26 | ||||||||||
Oxford Industries, Inc. | 2,475 | 158 | ||||||||||
Pacific Sunwear of California, Inc. (a) | 23,256 | 6 | ||||||||||
Papa John’s International, Inc. | 3,236 | 181 | ||||||||||
Papa Murphy’s Holdings, Inc. (a) | 1,654 | 19 | ||||||||||
Party City Holdco, Inc. (a) | 1,699 | 22 | ||||||||||
Penn National Gaming, Inc. (a) | 43,954 | 704 | ||||||||||
Pep Boys-Manny Moe & Jack (a) | 19,213 | 354 | ||||||||||
Perry Ellis International, Inc. (a) | 6,043 | 111 | ||||||||||
PetMed Express, Inc. | 8,095 | 139 | ||||||||||
Pier 1 Imports, Inc. | 70,419 | 358 | ||||||||||
Pinnacle Entertainment, Inc. (a) | 947 | 29 | ||||||||||
Popeyes Louisiana Kitchen, Inc. (a) | 1,134 | 66 | ||||||||||
Potbelly Corp. (a) | 8,797 | 103 | ||||||||||
Radio One, Inc. ‘D’ (a) | 4,072 | 7 | ||||||||||
Reading International, Inc. ‘A’ (a) | 1,648 | 22 | ||||||||||
Red Robin Gourmet Burgers, Inc. (a) | 1,276 | 79 |
56 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
SHARES | MARKET VALUE (000S) | |||||||||||
Regis Corp. (a) | 19,542 | $ | 276 | |||||||||
Ruby Tuesday, Inc. (a) | 5,942 | 33 | ||||||||||
Ruth’s Hospitality Group, Inc. | 7,075 | 113 | ||||||||||
Scholastic Corp. | 5,485 | 211 | ||||||||||
Sears Hometown and Outlet Stores, Inc. (a) | 4,157 | 33 | ||||||||||
Select Comfort Corp. (a) | 10,811 | 231 | ||||||||||
ServiceMaster Global Holdings, Inc. (a) | 924 | 36 | ||||||||||
Shoe Carnival, Inc. | 4,022 | 93 | ||||||||||
Sinclair Broadcast Group, Inc. ‘A’ | 1,334 | 43 | ||||||||||
Sizmek, Inc. (a) | 2,731 | 10 | ||||||||||
Skechers U.S.A., Inc. ‘A’ (a) | 6,353 | 192 | ||||||||||
Smith & Wesson Holding Corp. (a) | 13,127 | 289 | ||||||||||
Sonic Automotive, Inc. ‘A’ | 5,844 | 133 | ||||||||||
Sonic Corp. | 3,409 | 110 | ||||||||||
Sotheby’s | 4,684 | 121 | ||||||||||
Speedway Motorsports, Inc. | 2,876 | 60 | ||||||||||
Sportsman’s Warehouse Holdings, Inc. (a) | 7,065 | 91 | ||||||||||
Stage Stores, Inc. | 8,941 | 81 | ||||||||||
Standard Motor Products, Inc. | 2,040 | 78 | ||||||||||
Stein Mart, Inc. | 9,576 | 64 | ||||||||||
Steven Madden Ltd. (a) | 3,611 | 109 | ||||||||||
Stoneridge, Inc. (a) | 4,102 | 61 | ||||||||||
Strayer Education, Inc. (a) | 7,885 | 474 | ||||||||||
Sturm Ruger & Co., Inc. | 3,721 | 222 | ||||||||||
Superior Industries International, Inc. | 4,332 | 80 | ||||||||||
Taylor Morrison Home Corp. ‘A’ (a) | 935 | 15 | ||||||||||
Texas Roadhouse, Inc. | 11,016 | 394 | ||||||||||
Tile Shop Holdings, Inc. (a) | 3,519 | 58 | ||||||||||
Tilly’s, Inc. ‘A’ (a) | 5,947 | 39 | ||||||||||
Tower International, Inc. | 3,560 | 102 | ||||||||||
Town Sports International Holdings, Inc. (a) | 9,061 | 11 | ||||||||||
Townsquare Media, Inc. ‘A’ (a) | 506 | 6 | ||||||||||
Tuesday Morning Corp. (a) | 6,014 | 39 | ||||||||||
Tumi Holdings, Inc. (a) | 1,878 | 31 | ||||||||||
Universal Technical Institute, Inc. | 3,980 | 19 | ||||||||||
Vera Bradley, Inc. (a) | 9,459 | 149 | ||||||||||
Vince Holding Corp. (a) | 5,879 | 27 | ||||||||||
Vitamin Shoppe, Inc. (a) | 7,846 | 257 | ||||||||||
VOXX International Corp. (a) | 2,663 | 14 | ||||||||||
West Marine, Inc. (a) | 1,216 | 10 | ||||||||||
Weyco Group, Inc. | 68 | 2 | ||||||||||
Wolverine World Wide, Inc. | 2,254 | 38 | ||||||||||
World Wrestling Entertainment, Inc. ‘A’ | 6,187 | 110 | ||||||||||
Zumiez, Inc. (a) | 3,191 | 48 | ||||||||||
|
| |||||||||||
21,177 | ||||||||||||
|
| |||||||||||
CONSUMER STAPLES 4.5% | ||||||||||||
Alliance One International, Inc. (a) | 3,571 | 41 | ||||||||||
Andersons, Inc. | 1,494 | 47 | ||||||||||
B&G Foods, Inc. | 3,721 | 130 | ||||||||||
Boston Beer Co., Inc. ‘A’ (a) | 404 | 82 | ||||||||||
Cal-Maine Foods, Inc. | 2,784 | 129 | ||||||||||
Central Garden & Pet Co. ‘A’ (a) | 17,899 | 243 |
SHARES | MARKET VALUE (000S) | |||||||||||
Coca-Cola Bottling Co. Consolidated | 1,336 | $ | 244 | |||||||||
Coty, Inc. ‘A’ | 9,551 | 245 | ||||||||||
Elizabeth Arden, Inc. (a) | 15,015 | 149 | ||||||||||
Fresh Del Monte Produce, Inc. | 8,683 | 338 | ||||||||||
Fresh Market, Inc. (a) | 3,780 | 89 | ||||||||||
HRG Group, Inc. (a) | 27,434 | 372 | ||||||||||
Ingles Markets, Inc. ‘A’ | 11,264 | 497 | ||||||||||
Inter Parfums, Inc. | 3,750 | 89 | ||||||||||
J&J Snack Foods Corp. | 638 | 74 | ||||||||||
John B Sanfilippo & Son, Inc. | 1,380 | 75 | ||||||||||
Lancaster Colony Corp. | 677 | 78 | ||||||||||
Medifast, Inc. | 4,164 | 126 | ||||||||||
National Beverage Corp. (a) | 2,457 | 112 | ||||||||||
Nutraceutical International Corp. (a) | 1,195 | 31 | ||||||||||
Omega Protein Corp. (a) | 8,763 | 195 | ||||||||||
Pilgrim’s Pride Corp. | 1,198 | 26 | ||||||||||
Post Holdings, Inc. (a) | 948 | 58 | ||||||||||
PriceSmart, Inc. | 1,238 | 103 | ||||||||||
Revlon, Inc. ‘A’ (a) | 746 | 21 | ||||||||||
Sanderson Farms, Inc. | 469 | 36 | ||||||||||
Seaboard Corp. (a) | 22 | 64 | ||||||||||
Smart & Final Stores, Inc. (a) | 4,761 | 87 | ||||||||||
Snyder’s-Lance, Inc. | 3,180 | 109 | ||||||||||
SpartanNash Co. | 9,575 | 207 | ||||||||||
Spectrum Brands Holdings, Inc. | 934 | 95 | ||||||||||
USANA Health Sciences, Inc. (a) | 783 | 100 | ||||||||||
Vector Group Ltd. | 9,685 | 228 | ||||||||||
Village Super Market, Inc. ‘A’ | 1,040 | 27 | ||||||||||
WD-40 Co. | 1,083 | 107 | ||||||||||
Weis Markets, Inc. | 2,375 | 105 | ||||||||||
|
| |||||||||||
4,759 | ||||||||||||
|
| |||||||||||
ENERGY 3.9% | ||||||||||||
Alon USA Energy, Inc. | 6,853 | 102 | ||||||||||
Antero Resources Corp. (a) | 1,992 | 43 | ||||||||||
Basic Energy Services, Inc. (a) | 17,805 | 48 | ||||||||||
Bonanza Creek Energy, Inc. (a) | 22,393 | 118 | ||||||||||
C&J Energy Services Ltd. (a) | 6,454 | 31 | ||||||||||
CARBO Ceramics, Inc. | 10,426 | 179 | ||||||||||
Carrizo Oil & Gas, Inc. (a) | 3,464 | 102 | ||||||||||
Clayton Williams Energy, Inc. (a) | 1,556 | 46 | ||||||||||
Contango Oil & Gas Co. (a) | 2,327 | 15 | ||||||||||
CVR Energy, Inc. | 6,208 | 244 | ||||||||||
Delek U.S. Holdings, Inc. | 8,191 | 202 | ||||||||||
Enbridge Energy Management LLC (a) | 3,184 | 71 | ||||||||||
EP Energy Corp. ‘A’ (a) | 32,850 | 144 | ||||||||||
Era Group, Inc. (a) | 5,940 | 66 | ||||||||||
EXCO Resources, Inc. (a) | 31,828 | 39 | ||||||||||
Fairmount Santrol Holdings, Inc. (a) | 23,107 | 54 | ||||||||||
Forum Energy Technologies, Inc. (a) | 11,917 | 149 | ||||||||||
Geospace Technologies Corp. (a) | 11,976 | 169 | ||||||||||
Green Plains, Inc. | 1,077 | 25 | ||||||||||
Gulf Island Fabrication, Inc. | 2,959 | 31 | ||||||||||
Gulfmark Offshore, Inc. ‘A’ | 15,298 | 71 | ||||||||||
Hallador Energy Co. | 3,301 | 15 |
SHARES | MARKET VALUE (000S) | |||||||||||
Helix Energy Solutions Group, Inc. (a) | 32,229 | $ | 170 | |||||||||
Hornbeck Offshore Services, Inc. (a) | 5,369 | 53 | ||||||||||
ION Geophysical Corp. (a) | 32,789 | 17 | ||||||||||
Key Energy Services, Inc. (a) | 33,366 | 16 | ||||||||||
Kosmos Energy Ltd. (a) | 7,657 | 40 | ||||||||||
Laredo Petroleum, Inc. (a) | 21,877 | 175 | ||||||||||
Matador Resources Co. (a) | 4,290 | 85 | ||||||||||
Matrix Service Co. (a) | 769 | 16 | ||||||||||
McDermott International, Inc. (a) | 29,998 | 101 | ||||||||||
Memorial Resource Development Corp. (a) | 2,521 | 41 | ||||||||||
Natural Gas Services Group, Inc. (a) | 1,588 | 35 | ||||||||||
Newpark Resources, Inc. (a) | 19,360 | 102 | ||||||||||
Northern Oil and Gas, Inc. (a) | 43,826 | 169 | ||||||||||
Nuverra Environmental Solutions, Inc. (a) | 3,453 | 2 | ||||||||||
Oasis Petroleum, Inc. (a) | 1,028 | 8 | ||||||||||
Pacific Drilling S.A. (a) | 20,621 | 17 | ||||||||||
Panhandle Oil and Gas, Inc. ‘A’ | 1,320 | 21 | ||||||||||
Parker Drilling Co. (a) | 53,990 | 98 | ||||||||||
Parsley Energy, Inc. ‘A’ (a) | 1,868 | 34 | ||||||||||
PDC Energy, Inc. (a) | 1,728 | 92 | ||||||||||
Penn Virginia Corp. (a) | 9,754 | 3 | ||||||||||
PHI, Inc. (a) | 1,325 | 22 | ||||||||||
Pioneer Energy Services Corp. (a) | 9,905 | 22 | ||||||||||
Renewable Energy Group, Inc. (a) | 7,522 | 70 | ||||||||||
REX American Resources Corp. (a) | 245 | 13 | ||||||||||
Rex Energy Corp. (a) | 12,632 | 13 | ||||||||||
Rice Energy, Inc. (a) | 1,467 | 16 | ||||||||||
RPC, Inc. | 10,002 | 120 | ||||||||||
RSP Permian, Inc. (a) | 1,361 | 33 | ||||||||||
Sanchez Energy Corp. (a) | 17,806 | 77 | ||||||||||
Tesco Corp. | 13,178 | 95 | ||||||||||
TETRA Technologies, Inc. (a) | 27,404 | 206 | ||||||||||
U.S. Silica Holdings, Inc. | 580 | 11 | ||||||||||
Ultra Petroleum Corp. (a) | 9,055 | 23 | ||||||||||
VAALCO Energy, Inc. (a) | 12,786 | 20 | ||||||||||
W&T Offshore, Inc. | 57,347 | 132 | ||||||||||
Westmoreland Coal Co. (a) | 2,664 | 16 | ||||||||||
Willbros Group, Inc. (a) | 5,328 | 14 | ||||||||||
|
| |||||||||||
4,162 | ||||||||||||
|
| |||||||||||
FINANCIALS 11.9% | ||||||||||||
1st Source Corp. | 2,310 | 71 | ||||||||||
Access National Corp. | 646 | 13 | ||||||||||
Alexander & Baldwin, Inc. | 649 | 23 | ||||||||||
AMERISAFE, Inc. | 336 | 17 | ||||||||||
AmTrust Financial Services, Inc. | 1,185 | 73 | ||||||||||
Arrow Financial Corp. | 2,976 | 81 | ||||||||||
Astoria Financial Corp. | 13,215 | 209 | ||||||||||
Baldwin & Lyons, Inc. ‘B’ | 926 | 22 | ||||||||||
BancFirst Corp. | 570 | 33 | ||||||||||
Bancorp, Inc. (a) | 6,473 | 41 | ||||||||||
Bank Mutual Corp. | 5,597 | 44 | ||||||||||
Bank of Marin Bancorp | 35 | 2 | ||||||||||
Bank of the Ozarks, Inc. | 580 | 29 |
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 57 |
Table of Contents
Schedule of Investments PIMCO RAE Fundamental US Small Fund (Cont.)
SHARES | MARKET VALUE (000S) | |||||||||||
Beneficial Bancorp, Inc. (a) | 4,168 | $ | 56 | |||||||||
Berkshire Hills Bancorp, Inc. | 2,944 | 86 | ||||||||||
BOK Financial Corp. | 4,283 | 256 | ||||||||||
Brookline Bancorp, Inc. | 11,661 | 134 | ||||||||||
Bryn Mawr Bank Corp. | 706 | 20 | ||||||||||
Calamos Asset Management, Inc. ‘A’ | 7,798 | 76 | ||||||||||
Camden National Corp. | 741 | 33 | ||||||||||
Capital Bank Financial Corp. ‘A’ | 3,590 | 115 | ||||||||||
Cash America International, Inc. | 15,192 | 455 | ||||||||||
Cathay General Bancorp | 664 | 21 | ||||||||||
Charter Financial Corp. | 637 | 8 | ||||||||||
Chemical Financial Corp. | 2,092 | 72 | ||||||||||
City Holding Co. | 2,277 | 104 | ||||||||||
CNA Financial Corp. | 5,539 | 195 | ||||||||||
Columbia Banking System, Inc. | 1,260 | 41 | ||||||||||
Community Bank System, Inc. | 2,080 | 83 | ||||||||||
Community Trust Bancorp, Inc. | 2,594 | 91 | ||||||||||
Consumer Portfolio Services, Inc. (a) | 8,138 | 42 | ||||||||||
Cowen Group, Inc. ‘A’ (a) | 6,183 | 24 | ||||||||||
Crawford & Co. ‘B’ | 2,484 | 13 | ||||||||||
Credit Acceptance Corp. (a) | 1,380 | 295 | ||||||||||
Customers Bancorp, Inc. (a) | 1,410 | 38 | ||||||||||
Dime Community Bancshares, Inc. | 6,179 | 108 | ||||||||||
Eagle Bancorp, Inc. (a) | 777 | 39 | ||||||||||
eHealth, Inc. (a) | 10,740 | 107 | ||||||||||
EMC Insurance Group, Inc. | 792 | 20 | ||||||||||
Employers Holdings, Inc. | 6,747 | 184 | ||||||||||
Enova International, Inc. (a) | 11,883 | 79 | ||||||||||
Enterprise Financial Services Corp. | 1,357 | 39 | ||||||||||
Ezcorp, Inc. ‘A’ (a) | 20,943 | 105 | ||||||||||
FBL Financial Group, Inc. ‘A’ | 2,798 | 178 | ||||||||||
FBR & Co. | 1,789 | 36 | ||||||||||
FCB Financial Holdings, Inc. ‘A’ (a) | 1,970 | 71 | ||||||||||
Federal Agricultural Mortgage Corp. ‘C’ | 515 | 16 | ||||||||||
Fidelity & Guaranty Life | 9,667 | 245 | ||||||||||
Fidelity Southern Corp. | 3,527 | 79 | ||||||||||
Financial Institutions, Inc. | 2,429 | 68 | ||||||||||
First Bancorp | 2,423 | 45 | ||||||||||
First Busey Corp. | 2,409 | 50 | ||||||||||
First Cash Financial Services, Inc. (a) | 1,824 | 68 | ||||||||||
First Commonwealth Financial Corp. | 8,235 | 75 | ||||||||||
First Community Bancshares, Inc. | 3,392 | 63 | ||||||||||
First Connecticut Bancorp, Inc. | 1,446 | 25 | ||||||||||
First Defiance Financial Corp. | 1,370 | 52 | ||||||||||
First Financial Bancorp | 10,994 | 199 | ||||||||||
First Financial Corp. | 2,251 | 77 | ||||||||||
First Interstate BancSystem, Inc. ‘A’ | 2,037 | 59 | ||||||||||
First Midwest Bancorp, Inc. | 1,397 | 26 | ||||||||||
First NBC Bank Holding Co. (a) | 761 | 28 | ||||||||||
First of Long Island Corp. | 982 | 29 | ||||||||||
Flushing Financial Corp. | 5,009 | 108 | ||||||||||
Forestar Group, Inc. (a) | 3,606 | 39 | ||||||||||
GAIN Capital Holdings, Inc. | 4,716 | 38 | ||||||||||
German American Bancorp, Inc. | 593 | 20 | ||||||||||
GFI Group, Inc. (a) | 10,665 | 65 | ||||||||||
Great Southern Bancorp, Inc. | 2,258 | 102 |
SHARES | MARKET VALUE (000S) | |||||||||||
Great Western Bancorp, Inc. | 6,307 | $ | 183 | |||||||||
Greenhill & Co., Inc. | 2,313 | 66 | ||||||||||
GSV Capital Corp. (a) | 7,066 | 66 | ||||||||||
Heartland Financial USA, Inc. | 2,079 | 65 | ||||||||||
Heritage Insurance Holdings, Inc. | 2,443 | 53 | ||||||||||
HFF, Inc. ‘A’ | 2,587 | 80 | ||||||||||
Hilltop Holdings, Inc. (a) | 5,260 | 101 | ||||||||||
HomeStreet, Inc. (a) | 2,658 | 58 | ||||||||||
HomeTrust Bancshares, Inc. (a) | 1,759 | 36 | ||||||||||
Horace Mann Educators Corp. | 694 | 23 | ||||||||||
Horizon Bancorp | 1,141 | 32 | ||||||||||
Independent Bank Corp. | 885 | 41 | ||||||||||
Infinity Property & Casualty Corp. | 2,051 | 169 | ||||||||||
International Bancshares Corp. | 2,161 | 56 | ||||||||||
INTL. FCStone, Inc. (a) | 3,701 | 124 | ||||||||||
Investment Technology Group, Inc. | 3,482 | 59 | ||||||||||
Janus Capital Group, Inc. | 8,184 | 115 | ||||||||||
Kansas City Life Insurance Co. | 259 | 10 | ||||||||||
KCG Holdings, Inc. ‘A’ (a) | 25,005 | 308 | ||||||||||
Lakeland Bancorp, Inc. | 3,594 | 42 | ||||||||||
LegacyTexas Financial Group, Inc. | 785 | 20 | ||||||||||
LendingTree, Inc. (a) | 415 | 37 | ||||||||||
MainSource Financial Group, Inc. | 2,727 | 62 | ||||||||||
Marlin Business Services Corp. | 2,080 | 33 | ||||||||||
MB Financial, Inc. | 324 | 11 | ||||||||||
Mercury General Corp. | 3,859 | 180 | ||||||||||
Meridian Bancorp, Inc. | 1,403 | 20 | ||||||||||
Metro Bancorp, Inc. | 940 | 30 | ||||||||||
Morningstar, Inc. | 1,804 | 145 | ||||||||||
National Bank Holdings Corp. ‘A’ | 5,662 | 121 | ||||||||||
National Bankshares, Inc. | 59 | 2 | ||||||||||
National General Holdings Corp. | 919 | 20 | ||||||||||
National Penn Bancshares, Inc. | 3,211 | 40 | ||||||||||
National Western Life Group, Inc. ‘A’ | 308 | 78 | ||||||||||
Navigators Group, Inc. (a) | 1,015 | 87 | ||||||||||
NBT Bancorp, Inc. | 6,955 | 194 | ||||||||||
Nelnet, Inc. ‘A’ | 6,202 | 208 | ||||||||||
NMI Holdings, Inc. ‘A’ (a) | 5,716 | 39 | ||||||||||
Northfield Bancorp, Inc. | 7,156 | 114 | ||||||||||
Northwest Bancshares, Inc. | 15,553 | 208 | ||||||||||
OceanFirst Financial Corp. | 2,084 | 42 | ||||||||||
Old National Bancorp | 6,966 | 94 | ||||||||||
OneBeacon Insurance Group Ltd. ‘A’ | 8,170 | 101 | ||||||||||
OneMain Holdings, Inc. (a) | 2,801 | 116 | ||||||||||
Oppenheimer Holdings, Inc. ‘A’ | 716 | 12 | ||||||||||
Oritani Financial Corp. | 3,870 | 64 | ||||||||||
Pacific Premier Bancorp, Inc. (a) | 1,313 | 28 | ||||||||||
Park National Corp. | 1,614 | 146 | ||||||||||
PennyMac Financial Services, Inc. ‘A’ (a) | 1,300 | 20 | ||||||||||
Peoples Bancorp, Inc. | 816 | 15 | ||||||||||
Phoenix Cos., Inc. (a) | 1,330 | 49 | ||||||||||
Pinnacle Financial Partners, Inc. | 1,124 | 58 | ||||||||||
Piper Jaffray Cos. (a) | 2,534 | 102 | ||||||||||
Preferred Bank | 591 | 20 | ||||||||||
PrivateBancorp, Inc. | 303 | 12 | ||||||||||
Provident Financial Services, Inc. | 6,495 | 131 |
SHARES | MARKET VALUE (000S) | |||||||||||
RE/MAX Holdings, Inc. ‘A’ | 3,419 | $ | 128 | |||||||||
Regional Management Corp. (a) | 5,407 | 84 | ||||||||||
Renasant Corp. | 1,400 | 48 | ||||||||||
Republic Bancorp, Inc. ‘A’ | 2,561 | 68 | ||||||||||
RLI Corp. | 2,479 | 153 | ||||||||||
RMR Group, Inc. ‘A’ | 98 | 1 | ||||||||||
S&T Bancorp, Inc. | 1,272 | 39 | ||||||||||
Safety Insurance Group, Inc. | 2,505 | 141 | ||||||||||
Sandy Spring Bancorp, Inc. | 2,308 | 62 | ||||||||||
Selective Insurance Group, Inc. | 1,856 | 62 | ||||||||||
ServisFirst Bancshares, Inc. | 1,676 | 80 | ||||||||||
Sierra Bancorp | 129 | 2 | ||||||||||
Simmons First National Corp. ‘A’ | 426 | 22 | ||||||||||
South State Corp. | 309 | 22 | ||||||||||
Southside Bancshares, Inc. | 1,102 | 27 | ||||||||||
State Bank Financial Corp. | 2,382 | 50 | ||||||||||
Stewart Information Services Corp. | 1,063 | 40 | ||||||||||
Stock Yards Bancorp, Inc. | 1,237 | 47 | ||||||||||
Stonegate Bank | 1,171 | 39 | ||||||||||
Stonegate Mortgage Corp. (a) | 2,073 | 11 | ||||||||||
Suffolk Bancorp | 1,247 | 35 | ||||||||||
Talmer Bancorp, Inc. ‘A’ | 11,093 | 201 | ||||||||||
Territorial Bancorp, Inc. | 2,291 | 64 | ||||||||||
Tompkins Financial Corp. | 1,607 | 90 | ||||||||||
Towne Bank | 553 | 12 | ||||||||||
TriState Capital Holdings, Inc. (a) | 3,098 | 43 | ||||||||||
TrustCo Bank Corp. | 17,214 | 106 | ||||||||||
United Bankshares, Inc. | 685 | 25 | ||||||||||
United Fire Group, Inc. | 1,767 | 68 | ||||||||||
United Insurance Holdings Corp. | 592 | 10 | ||||||||||
Universal Insurance Holdings, Inc. | 3,750 | 87 | ||||||||||
Univest Corp. of Pennsylvania | 3,183 | 66 | ||||||||||
Walker & Dunlop, Inc. (a) | 2,542 | 73 | ||||||||||
Washington Trust Bancorp, Inc. | 1,217 | 48 | ||||||||||
Waterstone Financial, Inc. | 4,404 | 62 | ||||||||||
WesBanco, Inc. | 709 | 21 | ||||||||||
Westamerica BanCorp. | 3,374 | 158 | ||||||||||
Westwood Holdings Group, Inc. | 606 | 32 | ||||||||||
World Acceptance Corp. (a) | 12,679 | 470 | ||||||||||
WSFS Financial Corp. | 1,198 | 39 | ||||||||||
Yadkin Financial Corp. | 710 | 18 | ||||||||||
|
| |||||||||||
12,658 | ||||||||||||
|
| |||||||||||
HEALTH CARE 11.4% | ||||||||||||
Abaxis, Inc. | 1,196 | 67 | ||||||||||
ABIOMED, Inc. (a) | 1,090 | 98 | ||||||||||
Acceleron Pharma, Inc. (a) | 485 | 24 | ||||||||||
Aceto Corp. | 721 | 19 | ||||||||||
Acorda Therapeutics, Inc. (a) | 2,873 | 123 | ||||||||||
Addus HomeCare Corp. (a) | 1,169 | 27 | ||||||||||
Affymetrix, Inc. (a) | 11,868 | 120 | ||||||||||
Air Methods Corp. (a) | 2,473 | 104 | ||||||||||
Akorn, Inc. (a) | 1,172 | 44 | ||||||||||
Alliance HealthCare Services, Inc. (a) | 1,410 | 13 | ||||||||||
Almost Family, Inc. (a) | 3,358 | 128 | ||||||||||
AMAG Pharmaceuticals, Inc. (a) | 1,652 | 50 |
58 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
SHARES | MARKET VALUE (000S) | |||||||||||
Amedisys, Inc. (a) | 11,347 | $ | 446 | |||||||||
AMN Healthcare Services, Inc. (a) | 2,926 | 91 | ||||||||||
Amphastar Pharmaceuticals, Inc. (a) | 3,692 | 53 | ||||||||||
Anacor Pharmaceuticals, Inc. (a) | 974 | 110 | ||||||||||
Analogic Corp. | 1,402 | 116 | ||||||||||
AngioDynamics, Inc. (a) | 9,542 | 116 | ||||||||||
Anika Therapeutics, Inc. (a) | 703 | 27 | ||||||||||
Array BioPharma, Inc. (a) | 6,295 | 27 | ||||||||||
BioScrip, Inc. (a) | 24,529 | 43 | ||||||||||
BioTelemetry, Inc. (a) | 2,949 | 34 | ||||||||||
Bruker Corp. (a) | 14,582 | 354 | ||||||||||
Cambrex Corp. (a) | 4,348 | 205 | ||||||||||
Cantel Medical Corp. | 2,174 | 135 | ||||||||||
Capital Senior Living Corp. (a) | 1,984 | 41 | ||||||||||
Cardiovascular Systems, Inc. (a) | 1,294 | 20 | ||||||||||
Catalent, Inc. (a) | 2,400 | 60 | ||||||||||
Chemed Corp. | 3,344 | 501 | ||||||||||
Chimerix, Inc. (a) | 1,250 | 11 | ||||||||||
Civitas Solutions, Inc. (a) | 2,955 | 85 | ||||||||||
Computer Programs & Systems, Inc. | 1,099 | 55 | ||||||||||
CONMED Corp. | 4,494 | 198 | ||||||||||
Cross Country Healthcare, Inc. (a) | 3,025 | 50 | ||||||||||
Cynosure, Inc. ‘A’ (a) | 2,681 | 120 | ||||||||||
Depomed, Inc. (a) | 4,378 | 79 | ||||||||||
Diplomat Pharmacy, Inc. (a) | 630 | 22 | ||||||||||
Emergent BioSolutions, Inc. (a) | 6,085 | 243 | ||||||||||
Ensign Group, Inc. | 3,633 | 82 | ||||||||||
Exactech, Inc. (a) | 3,050 | 55 | ||||||||||
Exelixis, Inc. (a) | 1,677 | 9 | ||||||||||
Five Star Quality Care, Inc. (a) | 14,703 | 47 | ||||||||||
Genomic Health, Inc. (a) | 987 | 35 | ||||||||||
Globus Medical, Inc. ‘A’ (a) | 5,998 | 167 | ||||||||||
Greatbatch, Inc. (a) | 2,862 | 150 | ||||||||||
Haemonetics Corp. (a) | 5,119 | 165 | ||||||||||
Hanger, Inc. (a) | 13,998 | 230 | ||||||||||
HealthEquity, Inc. (a) | 772 | 19 | ||||||||||
Healthways, Inc. (a) | 7,861 | 101 | ||||||||||
HeartWare International, Inc. (a) | 798 | 40 | ||||||||||
HMS Holdings Corp. (a) | 9,933 | 123 | ||||||||||
ICU Medical, Inc. (a) | 1,664 | 188 | ||||||||||
Impax Laboratories, Inc. (a) | 578 | 25 | ||||||||||
IMS Health Holdings, Inc. (a) | 1,270 | 32 | ||||||||||
INC Research Holdings, Inc. ‘A’ (a) | 416 | 20 | ||||||||||
Insulet Corp. (a) | 2,241 | 85 | ||||||||||
Integra LifeSciences Holdings Corp. (a) | 5,246 | 356 | ||||||||||
Invacare Corp. | 9,296 | 162 | ||||||||||
K2M Group Holdings, Inc. (a) | 1,002 | 20 | ||||||||||
Landauer, Inc. | 686 | 23 | ||||||||||
Lannett Co., Inc. (a) | 1,326 | 53 | ||||||||||
LDR Holding Corp. (a) | 1,322 | 33 | ||||||||||
LeMaitre Vascular, Inc. | 1,497 | 26 | ||||||||||
LHC Group, Inc. (a) | 3,482 | 158 | ||||||||||
Ligand Pharmaceuticals, Inc. (a) | 689 | 75 | ||||||||||
Luminex Corp. (a) | 2,445 | 52 | ||||||||||
Masimo Corp. (a) | 10,919 | 453 | ||||||||||
MedAssets, Inc. (a) | 17,808 | 551 |
SHARES | MARKET VALUE (000S) | |||||||||||
Medicines Co. (a) | 5,729 | $ | 214 | |||||||||
Meridian Bioscience, Inc. | 4,610 | 95 | ||||||||||
Merit Medical Systems, Inc. (a) | 9,009 | 167 | ||||||||||
Molina Healthcare, Inc. (a) | 1,306 | 79 | ||||||||||
Momenta Pharmaceuticals, Inc. (a) | 505 | 7 | ||||||||||
Myriad Genetics, Inc. (a) | 5,635 | 243 | ||||||||||
National HealthCare Corp. | 1,075 | 66 | ||||||||||
Natus Medical, Inc. (a) | 3,294 | 158 | ||||||||||
Nektar Therapeutics (a) | 6,884 | 116 | ||||||||||
Neogen Corp. (a) | 2,255 | 127 | ||||||||||
NuVasive, Inc. (a) | 3,395 | 184 | ||||||||||
NxStage Medical, Inc. (a) | 3,341 | 73 | ||||||||||
Omnicell, Inc. (a) | 2,707 | 84 | ||||||||||
OraSure Technologies, Inc. (a) | 3,054 | 20 | ||||||||||
Pacira Pharmaceuticals, Inc. (a) | 865 | 66 | ||||||||||
PDL BioPharma, Inc. | 89,619 | 317 | ||||||||||
PharMerica Corp. (a) | 7,376 | 258 | ||||||||||
Phibro Animal Health Corp. ‘A’ | 1,553 | 47 | ||||||||||
PRA Health Sciences, Inc. (a) | 1,055 | 48 | ||||||||||
Premier, Inc. ‘A’ (a) | 2,193 | 77 | ||||||||||
Prestige Brands Holdings, Inc. (a) | 2,134 | 110 | ||||||||||
Providence Service Corp. (a) | 1,304 | 61 | ||||||||||
Quality Systems, Inc. | 14,952 | 241 | ||||||||||
Quidel Corp. (a) | 1,536 | 33 | ||||||||||
RadNet, Inc. (a) | 18,230 | 113 | ||||||||||
Repligen Corp. (a) | 2,546 | 72 | ||||||||||
Rigel Pharmaceuticals, Inc. (a) | 7,648 | 23 | ||||||||||
RTI Surgical, Inc. (a) | 6,556 | 26 | ||||||||||
Sagent Pharmaceuticals, Inc. (a) | 1,538 | 24 | ||||||||||
SciClone Pharmaceuticals, Inc. (a) | 6,309 | 58 | ||||||||||
Select Medical Holdings Corp. | 42,344 | 504 | ||||||||||
Spectrum Pharmaceuticals, Inc. (a) | 10,071 | 61 | ||||||||||
Surgical Care Affiliates, Inc. (a) | 7,587 | 302 | ||||||||||
SurModics, Inc. (a) | 4,740 | 96 | ||||||||||
U.S. Physical Therapy, Inc. | 760 | 41 | ||||||||||
Universal American Corp. | 14,116 | 99 | ||||||||||
Vascular Solutions, Inc. (a) | 945 | 32 | ||||||||||
Veeva Systems, Inc. ‘A’ (a) | 2,789 | 80 | ||||||||||
VWR Corp. (a) | 833 | 24 | ||||||||||
Zeltiq Aesthetics, Inc. (a) | 1,861 | 53 | ||||||||||
|
| |||||||||||
12,093 | ||||||||||||
|
| |||||||||||
INDUSTRIALS 14.3% | ||||||||||||
AAON, Inc. | 1,474 | 34 | ||||||||||
AAR Corp. | 7,408 | 195 | ||||||||||
ABM Industries, Inc. | 10,208 | 291 | ||||||||||
ACCO Brands Corp. (a) | 24,915 | 178 | ||||||||||
Actuant Corp. ‘A’ | 11,532 | 276 | ||||||||||
Advanced Drainage Systems, Inc. | 3,351 | 81 | ||||||||||
Advisory Board Co. (a) | 1,391 | 69 | ||||||||||
Aerovironment, Inc. (a) | 2,555 | 75 | ||||||||||
Air Transport Services Group, Inc. (a) | 10,589 | 107 | ||||||||||
Alamo Group, Inc. | 1,117 | 58 | ||||||||||
Albany International Corp. ‘A’ | 3,809 | 139 | ||||||||||
Allegiant Travel Co. | 611 | 103 | ||||||||||
Altra Industrial Motion Corp. | 1,806 | 45 |
SHARES | MARKET VALUE (000S) | |||||||||||
AMERCO | 142 | $ | 55 | |||||||||
Ameresco, Inc. ‘A’ (a) | 2,000 | 12 | ||||||||||
American Science & Engineering, Inc. | 3,646 | 151 | ||||||||||
American Woodmark Corp. (a) | 623 | 50 | ||||||||||
Apogee Enterprises, Inc. | 2,061 | 90 | ||||||||||
Applied Industrial Technologies, Inc. | 9,547 | 387 | ||||||||||
ARC Document Solutions, Inc. (a) | 6,138 | 27 | ||||||||||
ArcBest Corp. | 516 | 11 | ||||||||||
Astec Industries, Inc. | 1,918 | 78 | ||||||||||
AZZ, Inc. | 693 | 39 | ||||||||||
Barnes Group, Inc. | 4,151 | 147 | ||||||||||
Barrett Business Services, Inc. | 789 | 34 | ||||||||||
Beacon Roofing Supply, Inc. (a) | 6,121 | 252 | ||||||||||
Blount International, Inc. (a) | 19,268 | 189 | ||||||||||
BMC Stock Holdings, Inc. (a) | 590 | 10 | ||||||||||
Brady Corp. ‘A’ | 14,962 | 344 | ||||||||||
Briggs & Stratton Corp. | 14,205 | 246 | ||||||||||
Builders FirstSource, Inc. (a) | 3,295 | 37 | ||||||||||
BWX Technologies, Inc. | 3,794 | 121 | ||||||||||
CAI International, Inc. (a) | 3,479 | 35 | ||||||||||
Casella Waste Systems, Inc. ‘A’ (a) | 12,137 | 73 | ||||||||||
CBIZ, Inc. (a) | 13,794 | 136 | ||||||||||
CDI Corp. | 3,591 | 24 | ||||||||||
Cenveo, Inc. (a) | 21,933 | 19 | ||||||||||
Chart Industries, Inc. (a) | 8,697 | 156 | ||||||||||
Columbus McKinnon Corp. | 1,754 | 33 | ||||||||||
Comfort Systems USA, Inc. | 4,419 | 126 | ||||||||||
Commercial Vehicle Group, Inc. (a) | 2,825 | 8 | ||||||||||
Covenant Transportation Group, Inc. ‘A’ (a) | 2,348 | 44 | ||||||||||
CRA International, Inc. (a) | 2,721 | 51 | ||||||||||
Cubic Corp. | 2,785 | 132 | ||||||||||
Dorian LPG Ltd. (a) | 1,728 | 20 | ||||||||||
Douglas Dynamics, Inc. | 3,427 | 72 | ||||||||||
Ducommun, Inc. (a) | 2,465 | 40 | ||||||||||
DXP Enterprises, Inc. (a) | 3,840 | 88 | ||||||||||
Dycom Industries, Inc. (a) | 2,318 | 162 | ||||||||||
Dynamic Materials Corp. | 2,549 | 18 | ||||||||||
Eagle Bulk Shipping, Inc. (a) | 835 | 3 | ||||||||||
Echo Global Logistics, Inc. (a) | 2,247 | 46 | ||||||||||
Encore Wire Corp. | 1,781 | 66 | ||||||||||
Engility Holdings, Inc. | 631 | 20 | ||||||||||
Ennis, Inc. | 7,403 | 143 | ||||||||||
EnPro Industries, Inc. | 3,062 | 134 | ||||||||||
ESCO Technologies, Inc. | 2,998 | 108 | ||||||||||
Exponent, Inc. | 1,306 | 65 | ||||||||||
Forward Air Corp. | 510 | 22 | ||||||||||
Franklin Covey Co. (a) | 758 | 13 | ||||||||||
Franklin Electric Co., Inc. | 865 | 23 | ||||||||||
G&K Services, Inc. ‘A’ | 1,879 | 118 | ||||||||||
Gibraltar Industries, Inc. (a) | 872 | 22 | ||||||||||
Global Brass & Copper Holdings, Inc. | 10,857 | 231 | ||||||||||
Global Power Equipment Group, Inc. | 3,239 | 11 | ||||||||||
GP Strategies Corp. (a) | 818 | 21 | ||||||||||
Granite Construction, Inc. | 2,361 | 101 | ||||||||||
Great Lakes Dredge & Dock Corp. (a) | 15,079 | 60 | ||||||||||
Griffon Corp. | 11,520 | 205 |
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 59 |
Table of Contents
Schedule of Investments PIMCO RAE Fundamental US Small Fund (Cont.)
SHARES | MARKET VALUE (000S) | |||||||||||
H&E Equipment Services, Inc. | 8,487 | $ | 148 | |||||||||
Hawaiian Holdings, Inc. (a) | 6,627 | 234 | ||||||||||
HC2 Holdings, Inc. (a) | 9,481 | 50 | ||||||||||
Healthcare Services Group, Inc. | 544 | 19 | ||||||||||
Heartland Express, Inc. | 4,592 | 78 | ||||||||||
Heidrick & Struggles International, Inc. | 5,187 | 141 | ||||||||||
Herman Miller, Inc. | 372 | 11 | ||||||||||
Hill International, Inc. (a) | 10,367 | 40 | ||||||||||
Hillenbrand, Inc. | 4,850 | 144 | ||||||||||
HNI Corp. | 2,925 | 105 | ||||||||||
Hub Group, Inc. ‘A’ (a) | 1,110 | 37 | ||||||||||
Hurco Cos., Inc. | 1,243 | 33 | ||||||||||
Huron Consulting Group, Inc. (a) | 1,870 | 111 | ||||||||||
Hyster-Yale Materials Handling, Inc. | 885 | 46 | ||||||||||
ICF International, Inc. (a) | 4,352 | 155 | ||||||||||
InnerWorkings, Inc. (a) | 4,113 | 31 | ||||||||||
Insperity, Inc. | 4,098 | 197 | ||||||||||
Interface, Inc. | 3,158 | 60 | ||||||||||
John Bean Technologies Corp. | 1,823 | 91 | ||||||||||
Kadant, Inc. | 1,177 | 48 | ||||||||||
Kaman Corp. | 5,858 | 239 | ||||||||||
Kelly Services, Inc. ‘A’ | 6,745 | 109 | ||||||||||
KEYW Holding Corp. (a) | 7,650 | 46 | ||||||||||
Kforce, Inc. | 5,285 | 134 | ||||||||||
Kimball International, Inc. ‘B’ | 5,320 | 52 | ||||||||||
Knight Transportation, Inc. | 4,182 | 101 | ||||||||||
Knoll, Inc. | 6,860 | 129 | ||||||||||
Korn/Ferry International | 10,989 | 365 | ||||||||||
Kratos Defense & Security Solutions, Inc. (a) | 23,516 | 96 | ||||||||||
Layne Christensen Co. (a) | 4,699 | 25 | ||||||||||
LB Foster Co. ‘A’ | 1,260 | 17 | ||||||||||
Lindsay Corp. | 981 | 71 | ||||||||||
LSI Industries, Inc. | 3,387 | 41 | ||||||||||
Lydall, Inc. (a) | 480 | 17 | ||||||||||
Manitowoc Co., Inc. | 1,856 | 28 | ||||||||||
Marten Transport Ltd. | 3,229 | 57 | ||||||||||
MasTec, Inc. (a) | 16,933 | 294 | ||||||||||
Matson, Inc. | 3,119 | 133 | ||||||||||
Matthews International Corp. ‘A’ | 4,587 | 245 | ||||||||||
McGrath RentCorp | 5,280 | 133 | ||||||||||
Miller Industries, Inc. | 1,335 | 29 | ||||||||||
Mistras Group, Inc. (a) | 2,987 | 57 | ||||||||||
Mobile Mini, Inc. | 5,516 | 172 | ||||||||||
MSA Safety, Inc. | 725 | 32 | ||||||||||
Mueller Industries, Inc. | 2,467 | 67 | ||||||||||
Multi-Color Corp. | 249 | 15 | ||||||||||
MYR Group, Inc. (a) | 3,908 | 81 | ||||||||||
National Presto Industries, Inc. | 1,588 | 132 | ||||||||||
Navigant Consulting, Inc. (a) | 10,584 | 170 | ||||||||||
Nortek, Inc. (a) | 1,650 | 72 | ||||||||||
PAM Transportation Services, Inc. (a) | 810 | 22 | ||||||||||
Performant Financial Corp. (a) | 1,160 | 2 | ||||||||||
PGT, Inc. (a) | 1,842 | 21 | ||||||||||
Ply Gem Holdings, Inc. (a) | 2,756 | 35 | ||||||||||
Powell Industries, Inc. | 1,045 | 27 |
SHARES | MARKET VALUE (000S) | |||||||||||
Primoris Services Corp. | 2,389 | $ | 53 | |||||||||
Quad/Graphics, Inc. | 5,487 | 51 | ||||||||||
Quanex Building Products Corp. | 2,978 | 62 | ||||||||||
Raven Industries, Inc. | 2,511 | 39 | ||||||||||
RBC Bearings, Inc. (a) | 1,527 | 99 | ||||||||||
Resources Connection, Inc. | 11,686 | 191 | ||||||||||
Roadrunner Transportation Systems, Inc. (a) | 2,824 | 27 | ||||||||||
Rollins, Inc. | 2,642 | 68 | ||||||||||
RPX Corp. (a) | 7,200 | 79 | ||||||||||
Rush Enterprises, Inc. ‘A’ (a) | 6,632 | 145 | ||||||||||
Saia, Inc. (a) | 1,403 | 31 | ||||||||||
Simpson Manufacturing Co., Inc. | 3,558 | 121 | ||||||||||
SPX Corp. | 6,405 | 60 | ||||||||||
Standex International Corp. | 255 | 21 | ||||||||||
Steelcase, Inc. ‘A’ | 13,739 | 205 | ||||||||||
Sun Hydraulics Corp. | 1,110 | 35 | ||||||||||
TAL International Group, Inc. | 16,781 | 267 | ||||||||||
TASER International, Inc. (a) | 3,752 | 65 | ||||||||||
Team, Inc. (a) | 1,817 | 58 | ||||||||||
Tennant Co. | 848 | 48 | ||||||||||
Tetra Tech, Inc. | 1,640 | 43 | ||||||||||
Thermon Group Holdings, Inc. (a) | 2,151 | 36 | ||||||||||
Titan International, Inc. | 17,509 | 69 | ||||||||||
TriMas Corp. (a) | 8,624 | 161 | ||||||||||
TriNet Group, Inc. (a) | 1,614 | 31 | ||||||||||
TrueBlue, Inc. (a) | 925 | 24 | ||||||||||
Tutor Perini Corp. (a) | 4,372 | 73 | ||||||||||
U.S. Ecology, Inc. | 575 | 21 | ||||||||||
UniFirst Corp. | 987 | 103 | ||||||||||
Univar, Inc. (a) | 4,085 | 69 | ||||||||||
Universal Forest Products, Inc. | 1,468 | 100 | ||||||||||
USA Truck, Inc. (a) | 3,299 | 58 | ||||||||||
UTi Worldwide, Inc. (a) | 33,849 | 238 | ||||||||||
Veritiv Corp. (a) | 3,820 | 138 | ||||||||||
Viad Corp. | 581 | 16 | ||||||||||
Vicor Corp. (a) | 2,628 | 24 | ||||||||||
Watts Water Technologies, Inc. ‘A’ | 2,972 | 148 | ||||||||||
Werner Enterprises, Inc. | 11,419 | 267 | ||||||||||
Wesco Aircraft Holdings, Inc. (a) | 12,739 | 152 | ||||||||||
Xerium Technologies, Inc. (a) | 6,686 | 79 | ||||||||||
|
| |||||||||||
15,200 | ||||||||||||
|
| |||||||||||
INFORMATION TECHNOLOGY 20.8% | ||||||||||||
3D Systems Corp. (a) | 3,058 | 27 | ||||||||||
ACI Worldwide, Inc. (a) | 1,561 | 33 | ||||||||||
Actua Corp. (a) | 1,746 | 20 | ||||||||||
Acxiom Corp. (a) | 9,868 | 206 | ||||||||||
ADTRAN, Inc. | 24,644 | 424 | ||||||||||
Advanced Energy Industries, Inc. (a) | 3,417 | 97 | ||||||||||
Alpha & Omega Semiconductor Ltd. (a) | 3,376 | 31 | ||||||||||
Amkor Technology, Inc. (a) | 56,971 | 346 | ||||||||||
Applied Micro Circuits Corp. (a) | 4,411 | 28 | ||||||||||
Arista Networks, Inc. (a) | 666 | 52 | ||||||||||
Avid Technology, Inc. (a) | 17,607 | 128 |
SHARES | MARKET VALUE (000S) | |||||||||||
AVX Corp. | 10,970 | $ | 133 | |||||||||
Axcelis Technologies, Inc. (a) | 14,755 | 38 | ||||||||||
Badger Meter, Inc. | 178 | 10 | ||||||||||
Bankrate, Inc. (a) | 12,106 | 161 | ||||||||||
Bel Fuse, Inc. ‘B’ | 1,137 | 20 | ||||||||||
Belden, Inc. | 649 | 31 | ||||||||||
Benchmark Electronics, Inc. (a) | 17,431 | 360 | ||||||||||
Black Box Corp. | 4,521 | 43 | ||||||||||
Blackbaud, Inc. | 1,902 | 125 | ||||||||||
Blackhawk Network Holdings, Inc. (a) | 3,990 | 176 | ||||||||||
Blucora, Inc. (a) | 11,518 | 113 | ||||||||||
Bottomline Technologies de, Inc. (a) | 353 | 11 | ||||||||||
Brooks Automation, Inc. | 8,485 | 91 | ||||||||||
Cabot Microelectronics Corp. (a) | 8,792 | 385 | ||||||||||
CalAmp Corp. (a) | 1,477 | 29 | ||||||||||
Calix, Inc. (a) | 12,372 | 97 | ||||||||||
Callidus Software, Inc. (a) | 1,325 | 25 | ||||||||||
Cardtronics, Inc. (a) | 3,445 | 116 | ||||||||||
Cascade Microtech, Inc. (a) | 1,231 | 20 | ||||||||||
Cass Information Systems, Inc. | 204 | 11 | ||||||||||
CEVA, Inc. (a) | 1,739 | 41 | ||||||||||
Checkpoint Systems, Inc. | 13,172 | 83 | ||||||||||
Ciber, Inc. (a) | 21,446 | 75 | ||||||||||
Ciena Corp. (a) | 2,429 | 50 | ||||||||||
Cirrus Logic, Inc. (a) | 15,056 | 445 | ||||||||||
Coherent, Inc. (a) | 3,031 | 197 | ||||||||||
Cohu, Inc. | 3,633 | 44 | ||||||||||
CommScope Holding Co., Inc. (a) | 3,563 | 92 | ||||||||||
CommVault Systems, Inc. (a) | 2,677 | 105 | ||||||||||
comScore, Inc. (a) | 2,471 | 102 | ||||||||||
Comtech Telecommunications Corp. | 6,868 | 138 | ||||||||||
Constant Contact, Inc. (a) | 2,234 | 65 | ||||||||||
Cray, Inc. (a) | 1,639 | 53 | ||||||||||
CSG Systems International, Inc. | 7,567 | 272 | ||||||||||
CTS Corp. | 1,658 | 29 | ||||||||||
Cypress Semiconductor Corp. | 10,444 | 103 | ||||||||||
Daktronics, Inc. | 7,065 | 62 | ||||||||||
Datalink Corp. (a) | 6,953 | 47 | ||||||||||
DHI Group, Inc. (a) | 17,710 | 162 | ||||||||||
Digi International, Inc. (a) | 5,485 | 62 | ||||||||||
Digimarc Corp. (a) | 293 | 11 | ||||||||||
Diodes, Inc. (a) | 8,797 | 202 | ||||||||||
Dolby Laboratories, Inc. ‘A’ | 8,112 | 273 | ||||||||||
DSP Group, Inc. (a) | 6,024 | 57 | ||||||||||
DTS, Inc. (a) | 1,460 | 33 | ||||||||||
EarthLink Holdings Corp. | 74,070 | 550 | ||||||||||
Ebix, Inc. | 5,568 | 183 | ||||||||||
Electro Rent Corp. | 3,393 | 31 | ||||||||||
Electro Scientific Industries, Inc. | 5,162 | 27 | ||||||||||
Electronics For Imaging, Inc. (a) | 3,782 | 177 | ||||||||||
Ellie Mae, Inc. (a) | 1,201 | 72 | ||||||||||
EnerNOC, Inc. (a) | 5,238 | 20 | ||||||||||
Entegris, Inc. (a) | 14,830 | 197 | ||||||||||
EPAM Systems, Inc. (a) | 796 | 63 | ||||||||||
Epiq Systems, Inc. | 5,941 | 78 | ||||||||||
ePlus, Inc. (a) | 1,369 | 128 |
60 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
SHARES | MARKET VALUE (000S) | |||||||||||
Euronet Worldwide, Inc. (a) | 1,235 | $ | 89 | |||||||||
Everi Holdings, Inc. (a) | 16,840 | 74 | ||||||||||
ExlService Holdings, Inc. (a) | 4,236 | 190 | ||||||||||
Extreme Networks, Inc. (a) | 62,069 | 253 | ||||||||||
Fair Isaac Corp. | 3,176 | 299 | ||||||||||
Fairchild Semiconductor International, Inc. (a) | 18,877 | 391 | ||||||||||
FARO Technologies, Inc. (a) | 1,683 | 50 | ||||||||||
Finisar Corp. (a) | 3,622 | 53 | ||||||||||
FormFactor, Inc. (a) | 4,696 | 42 | ||||||||||
Forrester Research, Inc. | 1,232 | 35 | ||||||||||
GSI Group, Inc. (a) | 4,512 | 61 | ||||||||||
Hackett Group, Inc. | 4,998 | 80 | ||||||||||
Harmonic, Inc. (a) | 27,929 | 114 | ||||||||||
Heartland Payment Systems, Inc. | 1,112 | 105 | ||||||||||
II-VI, Inc. (a) | 8,487 | 158 | ||||||||||
Imation Corp. (a) | 11,353 | 16 | ||||||||||
Infinera Corp. (a) | 1,088 | 20 | ||||||||||
Infoblox, Inc. (a) | 1,213 | 22 | ||||||||||
Insight Enterprises, Inc. (a) | 13,569 | 341 | ||||||||||
Interactive Intelligence Group, Inc. (a) | 905 | 28 | ||||||||||
InterDigital, Inc. | 9,614 | 472 | ||||||||||
Internap Corp. (a) | 9,406 | 60 | ||||||||||
Intersil Corp. ‘A’ | 35,745 | 456 | ||||||||||
Intralinks Holdings, Inc. (a) | 12,532 | 114 | ||||||||||
Itron, Inc. (a) | 8,430 | 305 | ||||||||||
Ixia (a) | 19,448 | 242 | ||||||||||
IXYS Corp. | 4,200 | 53 | ||||||||||
Lattice Semiconductor Corp. (a) | 14,166 | 92 | ||||||||||
Limelight Networks, Inc. (a) | 13,914 | 20 | ||||||||||
Lionbridge Technologies, Inc. (a) | 5,175 | 25 | ||||||||||
Liquidity Services, Inc. (a) | 17,902 | 116 | ||||||||||
Littelfuse, Inc. | 950 | 102 | ||||||||||
LivePerson, Inc. (a) | 3,013 | 20 | ||||||||||
LogMeIn, Inc. (a) | 1,702 | 114 | ||||||||||
M/A-COM Technology Solutions Holdings, Inc. (a) | 1,719 | 70 | ||||||||||
ManTech International Corp. ‘A’ | 8,442 | 255 | ||||||||||
Maxwell Technologies, Inc. (a) | 7,293 | 52 | ||||||||||
Mentor Graphics Corp. | 2,681 | 49 | ||||||||||
Methode Electronics, Inc. | 935 | 30 | ||||||||||
MicroStrategy, Inc. ‘A’ (a) | 758 | 136 | ||||||||||
MKS Instruments, Inc. | 5,388 | 194 | ||||||||||
ModusLink Global Solutions, Inc. (a) | 6,678 | 17 | ||||||||||
MoneyGram International, Inc. (a) | 11,496 | 72 | ||||||||||
Monolithic Power Systems, Inc. | 388 | 25 | ||||||||||
Monotype Imaging Holdings, Inc. | 1,988 | 47 | ||||||||||
Monster Worldwide, Inc. (a) | 81,346 | 466 | ||||||||||
MTS Systems Corp. | 2,175 | 138 | ||||||||||
Multi-Fineline Electronix, Inc. (a) | 5,160 | 107 | ||||||||||
Nanometrics, Inc. (a) | 1,228 | 19 | ||||||||||
NETGEAR, Inc. (a) | 13,866 | 581 | ||||||||||
NetScout Systems, Inc. (a) | 1,270 | 39 | ||||||||||
Newport Corp. (a) | 8,647 | 137 | ||||||||||
NIC, Inc. | 4,142 | 82 | ||||||||||
OmniVision Technologies, Inc. (a) | 12,932 | 375 | ||||||||||
OSI Systems, Inc. (a) | 1,945 | 172 |
SHARES | MARKET VALUE (000S) | |||||||||||
Park Electrochemical Corp. | 4,241 | $ | 64 | |||||||||
PC Connection, Inc. | 2,972 | 67 | ||||||||||
Pegasystems, Inc. | 2,694 | 74 | ||||||||||
Perficient, Inc. (a) | 3,162 | 54 | ||||||||||
Photronics, Inc. (a) | 19,275 | 240 | ||||||||||
Plantronics, Inc. | 3,713 | 176 | ||||||||||
Plexus Corp. (a) | 5,505 | 192 | ||||||||||
PMC-Sierra, Inc. (a) | 43,607 | 507 | ||||||||||
Power Integrations, Inc. | 1,183 | 58 | ||||||||||
Progress Software Corp. (a) | 17,613 | 423 | ||||||||||
Qualys, Inc. (a) | 1,320 | 44 | ||||||||||
Quantum Corp. (a) | 31,595 | 29 | ||||||||||
QuinStreet, Inc. (a) | 4,935 | 21 | ||||||||||
Rambus, Inc. (a) | 2,239 | 26 | ||||||||||
RealD, Inc. (a) | 4,120 | 44 | ||||||||||
RealNetworks, Inc. (a) | 10,262 | 44 | ||||||||||
RealPage, Inc. (a) | 2,104 | 47 | ||||||||||
RetailMeNot, Inc. (a) | 7,424 | 74 | ||||||||||
RingCentral, Inc. ‘A’ (a) | 1,897 | 45 | ||||||||||
Rofin-Sinar Technologies, Inc. (a) | 4,696 | 126 | ||||||||||
Rogers Corp. (a) | 1,383 | 71 | ||||||||||
Rosetta Stone, Inc. (a) | 5,188 | 35 | ||||||||||
Rovi Corp. (a) | 11,221 | 187 | ||||||||||
Rudolph Technologies, Inc. (a) | 8,662 | 123 | ||||||||||
Sabre Corp. | 1,297 | 36 | ||||||||||
Sanmina Corp. (a) | 9,528 | 196 | ||||||||||
ScanSource, Inc. (a) | 5,230 | 169 | ||||||||||
Science Applications International Corp. | 5,031 | 230 | ||||||||||
Seachange International, Inc. (a) | 11,095 | 75 | ||||||||||
Semtech Corp. (a) | 5,101 | 97 | ||||||||||
ShoreTel, Inc. (a) | 8,771 | 78 | ||||||||||
Shutterstock, Inc. (a) | 839 | 27 | ||||||||||
Sigma Designs, Inc. (a) | 15,951 | 101 | ||||||||||
Silicon Graphics International Corp. (a) | 12,044 | 71 | ||||||||||
Silicon Laboratories, Inc. (a) | 2,985 | 145 | ||||||||||
Sonus Networks, Inc. (a) | 10,430 | 74 | ||||||||||
Stamps.com, Inc. (a) | 846 | 93 | ||||||||||
SunEdison Semiconductor Ltd. (a) | 10,865 | 85 | ||||||||||
Super Micro Computer, Inc. (a) | 1,989 | 49 | ||||||||||
Sykes Enterprises, Inc. (a) | 11,062 | 341 | ||||||||||
Synchronoss Technologies, Inc. (a) | 2,237 | 79 | ||||||||||
Syntel, Inc. (a) | 1,312 | 59 | ||||||||||
Tangoe, Inc. (a) | 3,687 | 31 | ||||||||||
TechTarget, Inc. (a) | 3,393 | 27 | ||||||||||
TeleCommunication Systems, Inc. ‘A’ (a) | 15,524 | 77 | ||||||||||
Telenav, Inc. (a) | 7,485 | 43 | ||||||||||
TeleTech Holdings, Inc. | 4,084 | 114 | ||||||||||
TESSCO Technologies, Inc. | 1,446 | 28 | ||||||||||
Tessera Technologies, Inc. | 3,441 | 103 | ||||||||||
TiVo, Inc. (a) | 2,816 | 24 | ||||||||||
TTM Technologies, Inc. (a) | 33,704 | 219 | ||||||||||
Ultra Clean Holdings, Inc. (a) | 9,654 | 49 | ||||||||||
United Online, Inc. (a) | 7,819 | 92 | ||||||||||
VASCO Data Security International, Inc. (a) | 2,418 | 40 |
SHARES | MARKET VALUE (000S) | |||||||||||
Viavi Solutions, Inc. (a) | 14,403 | $ | 88 | |||||||||
Vishay Precision Group, Inc. (a) | 1,678 | 19 | ||||||||||
Web.com Group, Inc. (a) | 1,362 | 27 | ||||||||||
WebMD Health Corp. (a) | 11,008 | 532 | ||||||||||
Xcerra Corp. (a) | 3,071 | 19 | ||||||||||
XO Group, Inc. (a) | 5,120 | 82 | ||||||||||
Xura, Inc. (a) | 4,297 | 106 | ||||||||||
Zix Corp. (a) | 6,187 | 31 | ||||||||||
Zynga, Inc. ‘A’ (a) | 63,887 | 171 | ||||||||||
|
| |||||||||||
22,089 | ||||||||||||
|
| |||||||||||
MATERIALS 4.0% |
| |||||||||||
A Schulman, Inc. ‘A’ | 5,239 | 161 | ||||||||||
AEP Industries, Inc. (a) | 1,216 | 94 | ||||||||||
AK Steel Holding Corp. (a) | 14,382 | 32 | ||||||||||
American Vanguard Corp. | 9,942 | 139 | ||||||||||
Ampco-Pittsburgh Corp. | 1,614 | 17 | ||||||||||
Axalta Coating Systems Ltd. (a) | 1,363 | 36 | ||||||||||
Balchem Corp. | 1,444 | 88 | ||||||||||
Boise Cascade Co. (a) | 2,386 | 61 | ||||||||||
Calgon Carbon Corp. | 3,532 | 61 | ||||||||||
Carpenter Technology Corp. | 5,467 | 165 | ||||||||||
Chemtura Corp. (a) | 6,456 | 176 | ||||||||||
Clearwater Paper Corp. (a) | 2,567 | 117 | ||||||||||
Coeur Mining, Inc. (a) | 11,122 | 28 | ||||||||||
Core Molding Technologies, Inc. (a) | 503 | 6 | ||||||||||
Flotek Industries, Inc. (a) | 2,510 | 29 | ||||||||||
FutureFuel Corp. | 7,008 | 95 | ||||||||||
Gold Resource Corp. | 7,418 | 12 | ||||||||||
Hawkins, Inc. | 1,356 | 48 | ||||||||||
Haynes International, Inc. | 1,357 | 50 | ||||||||||
HB Fuller Co. | 4,020 | 147 | ||||||||||
Headwaters, Inc. (a) | 3,774 | 64 | ||||||||||
Innophos Holdings, Inc. | 4,109 | 119 | ||||||||||
Innospec, Inc. | 2,066 | 112 | ||||||||||
Intrepid Potash, Inc. (a) | 5,885 | 17 | ||||||||||
Kaiser Aluminum Corp. | 4,090 | 342 | ||||||||||
Koppers Holdings, Inc. | 8,735 | 159 | ||||||||||
Kraton Performance Polymers, Inc. (a) | 7,303 | 121 | ||||||||||
Louisiana-Pacific Corp. (a) | 3,003 | 54 | ||||||||||
Materion Corp. | 3,209 | 90 | ||||||||||
Minerals Technologies, Inc. | 2,217 | 102 | ||||||||||
Myers Industries, Inc. | 6,308 | 84 | ||||||||||
Neenah Paper, Inc. | 1,083 | 68 | ||||||||||
Olympic Steel, Inc. | 1,933 | 22 | ||||||||||
OMNOVA Solutions, Inc. (a) | 7,316 | 45 | ||||||||||
PH Glatfelter Co. | 2,467 | 45 | ||||||||||
Quaker Chemical Corp. | 725 | 56 | ||||||||||
Ryerson Holding Corp. (a) | 4,606 | 22 | ||||||||||
Schnitzer Steel Industries, Inc. ‘A’ | 4,835 | 69 | ||||||||||
Schweitzer-Mauduit International, Inc. | 4,017 | 169 | ||||||||||
Stepan Co. | 3,186 | 158 | ||||||||||
Summit Materials, Inc. ‘A’ (a) | 2,316 | 46 | ||||||||||
SunCoke Energy, Inc. | 31,963 | 111 | ||||||||||
Tredegar Corp. | 2,857 | 39 |
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 61 |
Table of Contents
Schedule of Investments PIMCO RAE Fundamental US Small Fund (Cont.)
SHARES | MARKET VALUE (000S) | |||||||||||
Trinseo S.A. (a) | 2,483 | $ | 70 | |||||||||
Tronox Ltd. ‘A’ | 42,280 | 165 | ||||||||||
U.S. Concrete, Inc. (a) | 523 | 28 | ||||||||||
Wausau Paper Corp. | 5,069 | 52 | ||||||||||
Westlake Chemical Corp. | 730 | 40 | ||||||||||
Worthington Industries, Inc. | 5,991 | 181 | ||||||||||
|
| |||||||||||
4,212 | ||||||||||||
|
| |||||||||||
TELECOMMUNICATION SERVICES 2.5% |
| |||||||||||
Atlantic Tele-Network, Inc. | 944 | 74 | ||||||||||
Boingo Wireless, Inc. (a) | 5,356 | 35 | ||||||||||
Cogent Communications Holdings, Inc. | 2,179 | 76 | ||||||||||
Consolidated Communications Holdings, Inc. | 12,817 | 268 | ||||||||||
FairPoint Communications, Inc. (a) | 5,660 | 91 | ||||||||||
General Communication, Inc. ‘A’ (a) | 11,666 | 231 | ||||||||||
Hawaiian Telcom Holdco, Inc. (a) | 1,323 | 33 | ||||||||||
IDT Corp. ‘B’ | 3,605 | 42 | ||||||||||
Inteliquent, Inc. | 9,998 | 178 | ||||||||||
Iridium Communications, Inc. (a) | 43,584 | 367 | ||||||||||
Lumos Networks Corp. | 3,859 | 43 | ||||||||||
NTELOS Holdings Corp. (a) | 20,128 | 184 | ||||||||||
Shenandoah Telecommunications Co. | 1,805 | 78 | ||||||||||
Spok Holdings, Inc. | 4,931 | 90 | ||||||||||
U.S. Cellular Corp. (a) | 5,661 | 231 | ||||||||||
Vonage Holdings Corp. (a) | 83,847 | 481 | ||||||||||
West Corp. | 7,151 | 154 | ||||||||||
|
| |||||||||||
2,656 | ||||||||||||
|
| |||||||||||
UTILITIES 1.9% | ||||||||||||
American States Water Co. | 6,531 | 274 | ||||||||||
Artesian Resources Corp. ‘A’ | 1,163 | 32 | ||||||||||
California Water Service Group | 9,208 | 214 | ||||||||||
Chesapeake Utilities Corp. | 1,305 | 74 | ||||||||||
Connecticut Water Service, Inc. | 1,324 | 51 | ||||||||||
Empire District Electric Co. | 12,657 | 355 | ||||||||||
MGE Energy, Inc. | 4,570 | 212 | ||||||||||
Middlesex Water Co. | 2,638 | 70 | ||||||||||
New Jersey Resources Corp. | 1,748 | 58 | ||||||||||
Northwest Natural Gas Co. | 7,256 | 367 | ||||||||||
Otter Tail Corp. | 5,415 | 144 | ||||||||||
Pattern Energy Group, Inc. | 753 | 16 |
SHARES | MARKET VALUE (000S) | |||||||||||
SJW Corp. | 3,041 | $ | 90 | |||||||||
Unitil Corp. | 3,227 | 116 | ||||||||||
|
| |||||||||||
2,073 | ||||||||||||
|
| |||||||||||
Total United States | 101,079 | |||||||||||
|
| |||||||||||
Total Common Stocks (Cost $95,954) | 101,189 | |||||||||||
|
| |||||||||||
REAL ESTATE INVESTMENT TRUSTS 4.4% | ||||||||||||
UNITED STATES 4.4% | ||||||||||||
FINANCIALS 4.4% | ||||||||||||
AG Mortgage Investment Trust, Inc. | 5,703 | 73 | ||||||||||
Agree Realty Corp. | 600 | 20 | ||||||||||
American Assets Trust, Inc. | 1,389 | 53 | ||||||||||
American Capital Mortgage Investment Corp. | 13,269 | 185 | ||||||||||
American Residential Properties, Inc. | 2,956 | 56 | ||||||||||
Anworth Mortgage Asset Corp. | 49,852 | 217 | ||||||||||
Apollo Commercial Real Estate Finance, Inc. | 4,681 | 81 | ||||||||||
Apollo Residential Mortgage, Inc. | 4,216 | 50 | ||||||||||
Armada Hoffler Properties, Inc. | 1,887 | 20 | ||||||||||
ARMOUR Residential REIT, Inc. | 9,121 | 199 | ||||||||||
Ashford Hospitality Trust, Inc. | 5,816 | 37 | ||||||||||
Campus Crest Communities, Inc. | 5,583 | 38 | ||||||||||
Capstead Mortgage Corp. | 26,899 | 235 | ||||||||||
Cedar Realty Trust, Inc. | 5,843 | 41 | ||||||||||
Chatham Lodging Trust | 961 | 20 | ||||||||||
Chesapeake Lodging Trust | 1,402 | 35 | ||||||||||
Colony Capital, Inc. ‘A’ | 476 | 9 | ||||||||||
Colony Starwood Homes | 1,821 | 41 | ||||||||||
CorEnergy Infrastructure Trust, Inc. | 800 | 12 | ||||||||||
CoreSite Realty Corp. | 1,478 | 84 | ||||||||||
CyrusOne, Inc. | 1,678 | 63 | ||||||||||
CYS Investments, Inc. | 27,610 | 197 | ||||||||||
DuPont Fabros Technology, Inc. | 5,483 | 174 | ||||||||||
Dynex Capital, Inc. | 18,681 | 119 | ||||||||||
EastGroup Properties, Inc. | 650 | 36 | ||||||||||
Equity One, Inc. | 2,234 | 61 | ||||||||||
First Potomac Realty Trust | 8,858 | 101 | ||||||||||
Franklin Street Properties Corp. | 13,510 | 140 | ||||||||||
Getty Realty Corp. | 2,399 | 41 | ||||||||||
Gladstone Commercial Corp. | 2,564 | 37 |
SHARES | MARKET VALUE (000S) | |||||||||||
Government Properties Income Trust | 6,130 | $ | 97 | |||||||||
Gramercy Property Trust | 10,605 | 82 | ||||||||||
Healthcare Realty Trust, Inc. | 4,021 | 114 | ||||||||||
Investors Real Estate Trust | 14,770 | 103 | ||||||||||
Lexington Realty Trust | 15,754 | 126 | ||||||||||
LTC Properties, Inc. | 287 | 12 | ||||||||||
Monmouth Real Estate Investment Corp. | 652 | 7 | ||||||||||
Pennsylvania Real Estate Investment Trust | 2,237 | 49 | ||||||||||
PennyMac Mortgage Investment Trust | 6,808 | 104 | ||||||||||
Potlatch Corp. | 1,984 | 60 | ||||||||||
Preferred Apartment Communities, Inc. ‘A’ | 2,506 | 33 | ||||||||||
PS Business Parks, Inc. | 808 | 71 | ||||||||||
QTS Realty Trust, Inc. ‘A’ | 1,793 | 81 | ||||||||||
Ramco-Gershenson Properties Trust | 838 | 14 | ||||||||||
Redwood Trust, Inc. | 21,114 | 279 | ||||||||||
Resource Capital Corp. | 2,698 | 34 | ||||||||||
Rexford Industrial Realty, Inc. | 2,635 | 43 | ||||||||||
Rouse Properties, Inc. | 1,783 | 26 | ||||||||||
Ryman Hospitality Properties, Inc. | 5,859 | 303 | ||||||||||
Sabra Health Care REIT, Inc. | 1,950 | 39 | ||||||||||
Select Income REIT | 4,649 | 92 | ||||||||||
Silver Bay Realty Trust Corp. | 3,396 | 53 | ||||||||||
Summit Hotel Properties, Inc. | 6,133 | 73 | ||||||||||
Tier REIT, Inc. | 1,252 | 19 | ||||||||||
United Development Funding | 5,207 | 57 | ||||||||||
Urstadt Biddle Properties, Inc. ‘A’ | 2,213 | 43 | ||||||||||
Washington Real Estate Investment Trust | 5,899 | 160 | ||||||||||
Western Asset Mortgage Capital Corp. | 7,188 | 73 | ||||||||||
|
| |||||||||||
4,722 | ||||||||||||
|
| |||||||||||
Total Real Estate Investment Trusts | 4,722 | |||||||||||
|
| |||||||||||
Total Investments in Securities (Cost $100,793) | 105,911 | |||||||||||
Total Investments 99.6% (Cost $100,793) | $ | 105,911 | ||||||||||
Other Assets and Liabilities, net 0.4% | 437 | |||||||||||
|
| |||||||||||
Net Assets 100.0% | $ | 106,348 | ||||||||||
|
|
NOTES TO SCHEDULE OF INVESTMENTS (AMOUNTS IN THOUSANDS*):
* | A zero balance may reflect actual amounts rounding to less than one thousand. |
(a) | Security did not produce income within the last twelve months. |
62 | PIMCO EQUITY SERIES | See Accompanying Notes |
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FAIR VALUE MEASUREMENTS
The following is a summary of the fair valuations according to the inputs used as of December 31, 2015 in valuing the Fund’s assets and liabilities:
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Investments in Securities, at Value | ||||||||||||||||
Common Stocks | ||||||||||||||||
United Kingdom | ||||||||||||||||
Health Care | $ | 81 | $ | 0 | $ | 0 | $ | 81 | ||||||||
Materials | 29 | 0 | 0 | 29 | ||||||||||||
United States | ||||||||||||||||
Consumer Discretionary | 21,177 | 0 | 0 | 21,177 | ||||||||||||
Consumer Staples | 4,759 | 0 | 0 | 4,759 | ||||||||||||
Energy | 4,162 | 0 | 0 | 4,162 | ||||||||||||
Financials | 12,658 | 0 | 0 | 12,658 | ||||||||||||
Health Care | 12,093 | 0 | 0 | 12,093 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Industrials | $ | 15,200 | $ | 0 | $ | 0 | $ | 15,200 | ||||||||
Information Technology | 22,089 | 0 | 0 | 22,089 | ||||||||||||
Materials | 4,212 | 0 | 0 | 4,212 | ||||||||||||
Telecommunication Services | 2,656 | 0 | 0 | 2,656 | ||||||||||||
Utilities | 2,073 | 0 | 0 | 2,073 | ||||||||||||
Real Estate Investment Trusts | ||||||||||||||||
United States | ||||||||||||||||
Financials | 4,722 | 0 | 0 | 4,722 | ||||||||||||
Total Investments | $ | 105,911 | $ | 0 | $ | 0 | $ | 105,911 |
There were no significant transfers between Levels 1, 2, or 3 during the period ended December 31, 2015.
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 63 |
Table of Contents
1. ORGANIZATION
PIMCO Equity Series (the “Trust”) was established as a Delaware statutory trust on December 28, 2009. The Trust is registered under the Investment Company Act of 1940, as amended (the “Act”), as an open-end management investment company. Information presented in these financial statements pertains to the Institutional Class, Class P, Class A, and Class C shares of the funds (each a “Fund” and collectively the “Funds”) indicated on the cover of this report. Pacific Investment Management Company LLC (“PIMCO”) serves as the investment adviser (the “Adviser”) for the Funds. Research Affiliates, LLC (“Research Affiliates”) serves as the sub-adviser for the Funds. PIMCO and Research Affiliates have also engaged Parametric Portfolio Associates, LLC (“Parametric”) to implement all or a portion of each Fund’s investment strategies.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently followed by the Trust in the preparation of its financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Each Fund is treated as an investment company under the reporting requirements of U.S. GAAP. The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.
(a) Securities Transactions and Investment Income Securities transactions are recorded as of the trade date for financial reporting purposes. Securities purchased or sold on a when-issued or delayed-delivery basis may be settled 15 days or more after the trade date. Realized gains and losses from securities sold are recorded on the identified cost basis. Dividend income is recorded on the ex-dividend date, except certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Fund is informed of the ex-dividend date. Interest income, adjusted for the accretion of discounts and amortization of premiums, is recorded on the accrual basis from settlement date, with the exception of securities with a forward starting effective date, where interest income is recorded on the accrual basis from effective date. For convertible securities, premiums attributable to the conversion feature are not amortized. Estimated tax liabilities on certain foreign securities are recorded on an accrual basis and are reflected as components of interest income or net change in unrealized appreciation (depreciation) on investments on the Statements of Operations, as appropriate. Tax liabilities realized as a result of such security sales are reflected as a
component of net realized gain (loss) on investments on the Statements of Operations. Paydown gains and losses on mortgage-related and other asset-backed securities are recorded as components of interest income on the Statements of Operations. Income or short-term capital gain distributions received from registered investment companies are recorded as dividend income. Long-term capital gain distributions received from registered investment companies are recorded as realized gains.
(b) Cash and Foreign Currency The functional and reporting currency for the Funds is the U.S. dollar. The market values of foreign securities, currency holdings and other assets and liabilities are translated into U.S. dollars based on the current exchange rates each business day. Purchases and sales of securities and income and expense items denominated in foreign currencies, if any, are translated into U.S. dollars at the exchange rate in effect on the transaction date. The Funds do not separately report the effects of changes in foreign exchange rates from changes in market prices on securities held. Such changes are included in net realized gain (loss) and net change in unrealized appreciation (depreciation) from investments on the Statements of Operations. The Funds may invest in foreign currency-denominated securities and may engage in foreign currency transactions either on a spot (cash) basis at the rate prevailing in the currency exchange market at the time or through a forward foreign currency contract (see Financial Derivative Instruments, if any). Realized foreign exchange gains or losses arising from sales of spot foreign currencies, currency gains or losses realized between the trade and settlement dates on securities transactions and the difference between the recorded amounts of dividends, interest, and foreign withholding taxes and the U.S. dollar equivalent of the amounts actually received or paid are included in net realized gain (loss) on foreign currency transactions on the Statements of Operations. Net unrealized foreign exchange gains and losses arising from changes in foreign exchange rates on foreign denominated assets and liabilities other than investments in securities held at the end of the reporting period are included in net change in unrealized appreciation (depreciation) on foreign currency assets and liabilities on the Statements of Operations.
(c) Multiclass Operations Each class offered by the Trust has equal rights as to assets and voting privileges (except that shareholders of a class have exclusive voting rights regarding any matter relating solely to that class of shares). Income and non-class specific expenses are allocated daily to each class on the basis of the relative net assets. Realized and unrealized capital gains and losses are allocated daily based on the relative net assets of each class of the respective Fund. Class specific expenses, where applicable, currently include supervisory and administrative and distribution and servicing fees. Under certain circumstances, the per share net asset value (“NAV”) of a class of the respective Fund’s shares may be different from the per share NAV of
64 | PIMCO EQUITY SERIES |
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another class of shares as a result of the different daily expense accruals applicable to each class of shares.
(d) Dividends and Distributions to Shareholders Dividends from net investment income, if any, of each Fund, are declared and distributed to shareholders annually. Net realized capital gains earned by each Fund, if any, will be distributed no less frequently than once each year.
Income dividends and capital gain distributions are determined in accordance with income tax regulations which may differ from U.S. GAAP. Differences between tax regulations and U.S. GAAP may cause timing differences between income and capital gain recognition. Examples of events that give rise to timing differences include wash sales, straddles and capital loss carryforwards. Further, the character of investment income and capital gains may be different for certain transactions under the two methods of accounting. Examples of transactions that may cause character differences include the treatment of paydowns on mortgage-backed securities, swaps, foreign currency transactions and contingent debt instruments. As a result, income dividends and capital gain distributions declared during a fiscal period may differ significantly from the net investment income (loss) and realized gains (losses) reported on each Fund’s annual financial statements presented under U.S. GAAP.
Distributions classified as a tax basis return of capital, if any, are reflected on the Statements of Changes in Net Assets and have been recorded to paid in capital. In addition, other amounts have been reclassified between undistributed (overdistributed) net investment income (loss), accumulated undistributed (overdistributed) net realized gains (losses) and/or paid in capital to more appropriately conform financial accounting to tax characterizations of dividend distributions.
(e) New Accounting Pronouncements In June 2014, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standards Update (“ASU”), ASU 2014-11, that expanded secured borrowing accounting for certain repurchase agreements. The ASU also sets forth additional disclosure requirements for certain transactions accounted for as sales in order to provide financial statement users with information to compare to similar transactions accounted for as secured borrowings. The ASU became effective prospectively for annual periods beginning after December 15, 2014, and interim periods beginning after March 15, 2015. The Funds have adopted the ASU. The financial statements have been modified to provide enhanced disclosures surrounding secured borrowing transactions, if any. See the Notes to Schedules of Investments for additional details.
In August 2014, the FASB issued ASU 2014-15 requiring management to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern. The ASU is effective prospectively for
annual periods ending after December 15, 2016, and interim periods thereafter. At this time, management is evaluating the implications of these changes on the financial statements.
In May 2015, the FASB issued ASU 2015-07 which removes the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the NAV per share practical expedient. The ASU also removes the requirement to make certain disclosures for all investments that are eligible to be measured at fair value using the NAV per share practical expedient. The ASU is effective for annual periods beginning after December 15, 2015 and interim periods within those annual periods. At this time, management is evaluating the implications of these changes on the financial statements.
3. INVESTMENT VALUATION AND FAIR VALUE MEASUREMENTS
(a) Investment Valuation Policies The price of a Fund’s shares is based on the Fund’s NAV. The NAV of a Fund, or each of its share classes, as applicable, is determined by dividing the total value of portfolio investments and other assets attributable to that Fund or class, less any liabilities, by the total number of shares outstanding of that Fund or class. On each day that the New York Stock Exchange (“NYSE”) is open, Fund shares are ordinarily valued as of the close of regular trading (“NYSE Close”). Information that becomes known to the Funds or their agents after the time as of which NAV has been calculated on a particular day will not generally be used to retroactively adjust the price of a security or the NAV determined earlier that day. Each Fund reserves the right to change the time its respective NAV is calculated if the Fund closes earlier, or as permitted by the SEC.
For purposes of calculating NAV, portfolio securities and other assets for which market quotes are readily available are valued at market value. Market value is generally determined on the basis of official closing prices or the last reported sales prices, or if no sales are reported, based on quotes obtained from established market makers or prices (including evaluated prices) supplied by the Funds’ approved pricing services, quotation reporting systems and other third-party sources (together, “Pricing Services”). The Funds will normally use pricing data for domestic equity securities received shortly after the NYSE Close and do not normally take into account trading, clearances or settlements that take place after the NYSE Close. A foreign (non-U.S.) equity security traded on a foreign exchange or on more than one exchange is typically valued using pricing information from the exchange considered by the Adviser to be the primary exchange. A foreign (non-U.S.) equity security will be valued as of the close of trading on the foreign exchange, or the NYSE Close, if the NYSE Close occurs before the end of trading on the foreign exchange. Domestic and foreign (non-U.S.) fixed income securities, non-exchange traded derivatives, and equity options are normally valued on the basis of
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 65 |
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Notes to Financial Statements (Cont.)
quotes obtained from brokers and dealers or Pricing Services using data reflecting the earlier closing of the principal markets for those securities. Prices obtained from Pricing Services may be based on, among other things, information provided by market makers or estimates of market values obtained from yield data relating to investments or securities with similar characteristics. Certain fixed income securities purchased on a delayed-delivery basis are marked to market daily until settlement at the forward settlement date. Exchange-traded options, except equity options, futures and options on futures (which are discussed below), are valued at the settlement price determined by the relevant exchange. Swap agreements are valued on the basis of bid quotes obtained from brokers and dealers or market-based prices supplied by Pricing Services or other pricing sources. With respect to any portion of the Fund’s assets that are invested in one or more open-end management investment companies (other than exchange-traded funds (“ETFs”)), a Fund’s NAV will be calculated based upon the NAVs of such investments.
If a foreign (non-U.S.) equity security’s value has materially changed after the close of the security’s primary exchange or principal market but before the NYSE Close, the security may be valued at fair value based on procedures established and approved by the Board of Trustees of the Trust (the “Board”). Foreign (non-U.S.) equity securities that do not trade when the NYSE is open are also valued at fair value. With respect to foreign (non-U.S.) equity securities, the Fund may determine the fair value of investments based on information provided by Pricing Services and other third-party vendors, which may recommend fair value or adjustments with reference to other securities, indices or assets. In considering whether fair valuation is required and in determining fair values, the Fund may, among other things, consider significant events (which may be considered to include changes in the value of U.S. securities or securities indices) that occur after the close of the relevant market and before the NYSE Close. A Fund may utilize modeling tools provided by third-party vendors to determine fair values of non-U.S. securities. Foreign (non-U.S.) exchanges may permit trading in foreign (non-U.S.) equity securities on days when the Trust is not open for business, which may result in a Fund’s portfolio investments being affected when shareholders are unable to buy or sell shares.
Senior secured floating rate loans for which an active secondary market exists to a reliable degree will be valued at the mean of the last available bid/ask prices in the market for such loans, as provided by a Pricing Service. Senior secured floating rate loans for which an active secondary market does not exist to a reliable degree will be valued at fair value, which is intended to approximate market value. In valuing a senior secured floating rate loan at fair value, the factors considered may include, but are not limited to, the following: (a) the creditworthiness of the borrower and any intermediate participants, (b) the terms of the loan, (c) recent prices in the market for similar
loans, if any, and (d) recent prices in the market for instruments of similar quality, rate, period until next interest rate reset and maturity.
Investments valued in currencies other than the U.S. dollar are converted to the U.S. dollar using exchange rates obtained from Pricing Services. As a result, the value of such investments and, in turn, the NAV of the Fund’s shares may be affected by changes in the value of currencies in relation to the U.S. dollar. The value of investments traded in markets outside the United States or denominated in currencies other than the U.S. dollar may be affected significantly on a day that the Trust is not open for business. As a result, to the extent that a Fund holds foreign (non-U.S.) investments, the value of those investments may change at times when shareholders are unable to buy or sell shares and the value of such investments will be reflected in the Fund’s next calculated NAV.
Investments for which market quotes or market based valuations are not readily available are valued at fair value as determined in good faith by the Board or persons acting at their direction. The Board has adopted methods for valuing securities and other assets in circumstances where market quotes are not readily available, and has delegated to the Adviser the responsibility for applying the fair valuation methods. In the event that market quotes or market based valuations are not readily available, and the security or asset cannot be valued pursuant to a Board approved valuation method, the value of the security or asset will be determined in good faith by the Valuation Oversight Committee of the Board (“Valuation Oversight Committee”), generally based on recommendations provided by the Adviser. The Adviser may consult with the Sub-Adviser or Parametric in providing such recommendations or otherwise with respect to valuation of a Fund’s portfolio securities or other assets. Market quotes are considered not readily available in circumstances where there is an absence of current or reliable market-based data (e.g., trade information, bid/ask information, indicative market quotations (“Broker Quotes”), Pricing Services’ prices), including where events occur after the close of the relevant market, but prior to the NYSE Close, that materially affect the values of a Fund’s securities or assets. In addition, market quotes are considered not readily available when, due to extraordinary circumstances, the exchanges or markets on which the securities trade do not open for trading for the entire day and no other market prices are available. The Board has delegated to the Adviser the responsibility for monitoring significant events that may materially affect the values of the Fund’s securities or assets and for determining whether the value of the applicable securities or assets should be reevaluated in light of such significant events.
When a Fund uses fair valuation to determine the value of a portfolio security or other asset for purposes of calculating its NAV, such investments will not be priced on the basis of quotes from the primary
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December 31, 2015 (Unaudited)
market in which they are traded, but rather may be priced by another method that the Board or persons acting at their direction believe reflects fair value. Fair valuation may require subjective determinations about the value of a security. While the Trust’s policy is intended to result in a calculation of the Fund’s NAV that fairly reflects security values as of the time of pricing, the Trust cannot ensure that fair values determined by the Board or persons acting at their direction would accurately reflect the price that a Fund could obtain for a security if it were to dispose of that security as of the time of pricing (for instance, in a forced or distressed sale). The prices used by a Fund may differ from the value that would be realized if the securities were sold. The Funds’ use of fair valuation may also help to deter “stale price arbitrage” as discussed under the “Abusive Trading Practices” section in each Fund’s prospectus.
(b) Fair Value Hierarchy U.S. GAAP describes fair value as the price that a Fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. It establishes a fair value hierarchy that prioritizes inputs to valuation methods and requires disclosure of the fair value hierarchy, separately for each major category of assets and liabilities, that segregates fair value measurements into levels (Level 1, 2, or 3). The inputs or methodology used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. Levels 1, 2, and 3 of the fair value hierarchy are defined as follows:
n | Level 1 — Inputs using (unadjusted) quoted prices in active markets or exchanges for identical assets and liabilities. |
n | Level 2 — Significant other observable inputs, which may include, but are not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market corroborated inputs. |
n | Level 3 — Significant unobservable inputs based on the best information available in the circumstances, to the extent observable inputs are not available, which may include assumptions made by the Board or persons acting at their direction that are used in determining the fair value of investments. |
In accordance with the requirements of U.S. GAAP, the amounts of transfers between Levels 1 and 2 and transfers in and out of Level 3, if material, are disclosed in the Notes to Schedules of Investments for each respective Fund.
For fair valuations using significant unobservable inputs, U.S. GAAP requires a reconciliation of the beginning to ending balances for reported fair values that presents changes attributable to realized gain (loss), unrealized appreciation (depreciation), purchases and sales, accrued discounts (premiums), and transfers in and out of the Level 3 category during the period. The end of period timing recognition is used for the transfers between Levels of a Fund’s assets and liabilities. Additionally, U.S. GAAP requires quantitative information regarding the significant unobservable inputs used in the determination of fair value of assets or liabilities categorized as Level 3 in the fair value hierarchy. In accordance with the requirements of U.S. GAAP, a fair value hierarchy, and if material, a Level 3 reconciliation and details of significant unobservable inputs, have been included in the Notes to Schedules of Investments for each respective Fund.
(c) Valuation Techniques and the Fair Value Hierarchy Level 1 and Level 2 trading assets and trading liabilities, at fair value The valuation methods (or “techniques”) and significant inputs used in determining the fair values of portfolio securities or other assets and liabilities categorized as Level 1 and Level 2 of the fair value hierarchy are as follows:
Common stocks, ETFs, exchange-traded notes and financial derivative instruments, such as futures contracts, rights and warrants, or options on futures that are traded on a national securities exchange, are stated at the last reported sale or settlement price on the day of valuation. To the extent these securities are actively traded and valuation adjustments are not applied, they are categorized as Level 1 of the fair value hierarchy.
Valuation adjustments may be applied to certain securities that are solely traded on a foreign exchange to account for the market movement between the close of the foreign market and the NYSE Close. These securities are valued using Pricing Services that consider the correlation of the trading patterns of the foreign security to the intraday trading in the U.S. markets for investments. Securities using these valuation adjustments are categorized as Level 2 of the fair value hierarchy. Preferred securities and other equities traded on inactive markets or valued by reference to similar instruments are also categorized as Level 2 of the fair value hierarchy.
Equity-linked securities are valued by referencing the last reported sale or settlement price of the linked referenced equity on the day of valuation. Foreign exchange adjustments are applied to the last reported price to convert the linked equity’s trading currency to the contract’s settling currency. These investments are categorized as Level 2 of the fair value hierarchy.
Level 3 trading assets and trading liabilities, at fair value When a fair valuation method is applied by the Adviser that uses significant
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unobservable inputs, investments will be priced by a method that the Board or persons acting at their direction believe reflects fair value and are categorized as Level 3 of the fair value hierarchy.
The validity of the fair value is reviewed by the Adviser on a periodic basis and may be amended in accordance with the Trust’s valuation procedures.
4. SECURITIES AND OTHER INVESTMENTS
(a) Investments in Affiliates
The PIMCO RAE Fundamental Global Fund and PIMCO RAE Fundamental Global ex-US Fund invest substantially all of their assets in Institutional Class shares of the Underlying Funds and may also invest in other affiliated funds, and unaffiliated funds, which may or may not be registered under the Act (together with the Underlying Funds, “Acquired Funds”). The Underlying Funds are considered to be affiliated with the PIMCO RAE Fundamental Global Fund and PIMCO RAE Fundamental Global ex-US Fund. Each Fund may also invest in the PIMCO Short-Term Floating NAV Portfolio III (“Central Fund”) to the extent permitted by the Act and rules thereunder. The Central Fund is a registered investment company created for use solely by the series of the Trust and other series of registered investment companies advised by the Adviser, in connection with their cash management activities. The main investments of the Central Fund are money market and short maturity fixed income instruments. The Central Fund may incur expenses related to its investment activities, but does not pay Investment Advisory Fees or Supervisory and Administrative Fees to the Adviser. The Central Fund is considered to be affiliated with the Funds. The tables below show the Funds’ transactions in and earnings from investments in these affiliated Funds for the period ended December 31, 2015 (amounts in thousands†):
PIMCO RAE Fundamental Global Fund | ||||||||||||||||||||||||||||||||||
Underlying PIMCO Funds | Market Value 06/30/2015 | Purchases at Cost | Proceeds from Sales | Net Realized Gain (Loss) | Change in Unrealized Appreciation (Depreciation) | Market Value 12/31/2015 | Dividend Income (1) | Realized Net Capital Gain Distributions (1) | ||||||||||||||||||||||||||
PIMCO RAE Fundamental Emerging Markets Fund | $ | 4,767 | $ | 16,223 | $ | (872 | ) | $ | (203 | ) | $ | (1,922 | ) | $ | 17,993 | $ | 401 | $ | 0 | |||||||||||||||
PIMCO RAE Fundamental International Fund | 13,546 | 65,818 | (1,396 | ) | (187 | ) | (4,713 | ) | 73,068 | 642 | 1,285 | |||||||||||||||||||||||
PIMCO RAE Fundamental US Fund | 19,847 | 101,473 | (1,494 | ) | (92 | ) | (6,247 | ) | 113,487 | 1,284 | 2,600 | |||||||||||||||||||||||
Totals | $ | 38,160 | $ | 183,514 | $ | (3,762 | ) | $ | (482 | ) | $ | (12,882 | ) | $ | 204,548 | $ | 2,327 | $ | 3,885 |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
(1) | A portion of this may be recharacterized to return of capital and reflected as such on tax forms mailed to shareholders on or about January 31st following each calendar year. |
PIMCO RAE Fundamental Global ex-US Fund | ||||||||||||||||||||||||||||||||||
Underlying PIMCO Funds | Market Value 06/30/2015 | Purchases at Cost | Proceeds from Sales | Net Realized Gain (Loss) | Change in Unrealized Appreciation (Depreciation) | Market Value 12/31/2015 | Dividend Income (1) | Realized Net Capital Gain Distributions (1) | ||||||||||||||||||||||||||
PIMCO RAE Fundamental Emerging Markets Fund | $ | 18,231 | $ | 335 | $ | (2,246 | ) | $ | (492 | ) | $ | (3,798 | ) | $ | 12,030 | $ | 266 | $ | 0 | |||||||||||||||
PIMCO RAE Fundamental International Fund | 51,806 | 3,810 | (36 | ) | (4 | ) | (6,358 | ) | 49,218 | 426 | 853 | |||||||||||||||||||||||
Totals | $ | 70,037 | $ | 4,145 | $ | (2,282 | ) | $ | (496 | ) | $ | (10,156 | ) | $ | 61,248 | $ | 692 | $ | 853 |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
(1) | A portion of this may be recharacterized to return of capital and reflected as such on tax forms mailed to shareholders on or about January 31st following each calendar year. |
(b) Investments in Securities
Equity-Linked Securities Certain Funds may invest in equity-linked securities. Equity-linked securities are privately issued securities that have a return component based on the performance of a single stock, a basket of stocks, or a stock index. Equity-linked securities are often used for many of the same purposes as, and share many of the same risks with derivative instruments.
Restricted Securities Certain Funds may invest in securities that are subject to legal or contractual restrictions on resale. These securities may be sold privately, but are required to be registered or exempted from such registration before being sold to the public. Private
placement securities are generally considered to be restricted except for those securities traded between qualified institutional investors under the provisions of Rule 144A of the Securities Act of 1933. Disposal of restricted securities may involve time-consuming negotiations and expenses, and prompt sale at an acceptable price may be difficult to achieve. Restricted securities outstanding at December 31, 2015 are disclosed in the Notes to Schedules of Investments.
5. FINANCIAL DERIVATIVE INSTRUMENTS
The following disclosures contain information on how and why the Funds use financial derivative instruments, and how financial derivative instruments affect the Funds’ financial position, results of operations
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and cash flows. The location and fair value amounts of these instruments on the Statements of Assets and Liabilities and the net realized gain (loss) and net change in unrealized appreciation (depreciation) on the Statements of Operations, each categorized by type of financial derivative contract and related risk exposure, are included in a table in the Notes to Schedules of Investments. The financial derivative instruments outstanding as of period end and the amounts of net realized gain (loss) and net change in unrealized appreciation (depreciation) on financial derivative instruments during the period, as disclosed in the Notes to Schedules of Investments, serve as indicators of the volume of financial derivative activity for the Funds.
(a) Forward Foreign Currency Contracts Certain Funds may enter into forward foreign currency contracts in connection with settling planned purchases or sales of securities, to hedge the currency exposure associated with some or all of a Fund’s securities or as a part of an investment strategy. A forward foreign currency contract is an agreement between two parties to buy and sell a currency at a set price on a future date. The market value of a forward foreign currency contract fluctuates with changes in foreign currency exchange rates. Forward foreign currency contracts are marked to market daily, and the change in value is recorded by a Fund as an unrealized gain or loss. Realized gains or losses are equal to the difference between the value of the contract at the time it was opened and the value at the time it was closed and are recorded upon delivery or receipt of the currency. These contracts may involve market risk in excess of the unrealized gain or loss reflected on the Statements of Assets and Liabilities. In addition, a Fund could be exposed to risk if the counterparties are unable to meet the terms of the contracts or if the value of the currency changes unfavorably to the U.S. dollar. To mitigate such risk, cash or securities may be exchanged as collateral pursuant to the terms of the underlying contracts.
6. PRINCIPAL RISKS
In the normal course of business, the Funds (or Acquired Funds) trade financial instruments and enter into financial transactions where risk of potential loss exists due to such things as changes in the market (market risk) or failure or inability of the other party to a transaction to perform (credit and counterparty risk). See below for a detailed description of select principal risks. For a more comprehensive list of potential risks the Funds may be subject to, please see the Important Information About the Funds.
Investments in Mutual Funds To the extent that certain Funds invest substantially all of their respective assets in Acquired Funds, the risks associated with investing in these Funds will be closely related to the risks associated with the securities and other investments held by the Acquired Funds. The ability of the Funds to achieve their respective investment objectives may depend upon the ability of the Acquired
Funds to achieve their respective investment objectives. There can be no assurance that the investment objective of any Acquired Fund will be achieved. The NAV of each Fund will fluctuate in response to changes in the respective NAV of the Acquired Funds in which it invests. The extent to which the investment performance and risks associated with the Funds correlate to those of a particular Acquired Fund will depend upon the extent to which the assets of the Funds are allocated from time to time for investment in the Acquired Funds, which will vary.
Certain Funds’ investment performance depends upon how each Fund’s assets are allocated and reallocated according to each Fund’s asset allocation targets and ranges. A principal risk of investing in each Fund is that the Funds’ asset allocation sub-adviser will make less than optimal or poor asset allocation decisions. The asset allocation sub-adviser attempts to identify investment allocations for the Acquired Funds that will provide consistent, quality performance for the Funds, but there is no guarantee that such allocation techniques will produce the desired results.
Market Risks A Fund’s (or Acquired Funds’) investments in financial derivative instruments and other financial instruments expose the Fund to various risks such as, but not limited to, interest rate, foreign currency, equity and commodity risks.
The market values of equities, such as common stocks and preferred securities or equity related investments such as futures and options, have historically risen and fallen in periodic cycles and may decline due to general market conditions which are not specifically related to a particular company, such as real or perceived adverse economic conditions, changes in the general outlook for corporate earnings, changes in interest or currency rates or adverse investor sentiment generally. They may also decline due to factors which affect a particular industry or industries, such as labor shortages or increased production costs and competitive conditions within an industry. Different types of equity securities may react differently to these developments. Equity securities and equity related investments generally have greater market price volatility than fixed income securities.
Issuers that have paid regular dividends or distributions to shareholders may not continue to do so in the future. An issuer may reduce or eliminate future dividends or distributions at any time and for any reason. Moreover, a Fund may use a dividend capture strategy (i.e., purchasing an equity security shortly before the issuer pays a dividend and selling it shortly thereafter) which may expose the Fund to higher portfolio turnover, increased trading costs and the potential for capital loss or gain, particularly in the event of significant short-term price movements of stocks subject to dividend capture trading. Also, securities purchased to capture a dividend often decline in value at the
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time of sale (i.e., shortly following the dividend) and the resulting realized loss to the Fund may exceed the amount of the dividend received, thereby negatively impacting the Fund’s net asset value.
Interest rate risk is the risk that fixed income securities will decline in value because of an increase in interest rates. As nominal interest rates rise, the value of certain fixed income securities held by a Fund (or Acquired Funds) is likely to decrease. A nominal interest rate can be described as the sum of a real interest rate and an expected inflation rate. Interest rate changes can be sudden and unpredictable, and a Fund (or Acquired Funds) may lose money if these changes are not anticipated by the Fund’s (or Acquired Funds) management. A Fund (or Acquired Funds) may not be able to hedge against changes in interest rates or may choose not to do so for cost or other reasons. In addition, any hedges may not work as intended.
Duration is a measure of the sensitivity of a fixed income security’s market price to interest rate (i.e., yield) movements that incorporates a security’s yield, coupon, final maturity and call features, among other characteristics. Convexity is an additional measure of interest rate sensitivity that measures the rate of change of duration in response to changes in interest rates. Fixed income securities with longer durations tend to be more sensitive to changes in interest rates, usually making them more volatile than securities with shorter durations. A wide variety of factors can cause interest rates to rise (e.g., central bank monetary policies, inflation rates, general economic conditions). At present, the U.S. is experiencing historically low interest rates. The Funds may be subject to heightened interest rate risk because the Fed has ended its quantitative easing program and has begun, and may continue, to raise interest rates. Further, while U.S. bond markets have steadily grown over the past three decades, dealer “market making” ability has remained relatively stagnant. Given the importance of intermediary “market making” in creating a robust and active market, fixed income securities are currently facing increased volatility and liquidity risks. All of these factors, collectively and/or individually, could cause a Fund (or Acquired Funds) to lose value. If a Fund (or Acquired Funds) lost enough value, the Fund (or Acquired Funds) could face increased redemptions by shareholders, which could further impair its performance.
To the extent that a Fund (or Acquired Fund) may invest in securities and instruments that are economically tied to Russia, the Fund (or Acquired Fund) is subject to various risks such as, but not limited to political, economic, legal, market and currency risks. The risks include uncertain political and economic policies, short-term market volatility, poor accounting standards, corruption and crime, an inadequate regulatory system, and unpredictable taxation. Investments in Russia are particularly subject to the risk that further economic sanctions may be imposed by the United States and/or other countries. Such sanctions — which may impact companies in many sectors, including energy,
financial services and defense, among others — may negatively impact a Fund’s (or Acquired Fund’s) performance and/or ability to achieve its investment objective. The Russian securities market, as compared to U.S. markets, has significant price volatility, less liquidity, difficulties in obtaining accurate prices, a smaller market capitalization and a smaller number of traded securities. Settlement, clearing and registration of securities transactions are subject to risks, which may result in significant delays or problems in registering the transfer of securities, including issues with foreign nominee accounts held with custodian banks. It is possible that the ownership rights of a Fund (or Acquired Fund) could be lost through fraud or negligence. In addition, it may be difficult for a Fund (or Acquired Fund) to enforce any rights it may have in the event of loss of share registration. Adverse currency exchange rates are a risk and there may be a lack of available currency hedging instruments. Investments in Russia may be subject to the risk of nationalization or expropriation of assets. Oil, natural gas, metals, and timber account for a significant portion of Russia’s exports, leaving the country vulnerable to swings in world prices.
If a Fund (or Acquired Funds) invests directly in foreign (non-U.S.) currencies or in securities that trade in, and receive revenues in, foreign (non-U.S.) currencies, or in financial derivative instruments that provide exposure to foreign (non-U.S.) currencies, it will be subject to the risk that those currencies will decline in value relative to the base currency of the Fund (or Acquired Funds), or, in the case of hedging positions, that the Fund’s (or Acquired Funds’) base currency will decline in value relative to the currency being hedged. Currency rates in foreign countries may fluctuate significantly over short periods of time for a number of reasons, including changes in interest rates, intervention (or the failure to intervene) by U.S. or foreign governments, central banks or supranational entities such as the International Monetary Fund, or by the imposition of currency controls or other political developments in the United States or abroad. As a result, a Fund’s (or Acquired Funds’) investments in foreign currency-denominated securities may reduce the Fund’s (or Acquired Funds) returns.
A Fund’s (or Acquired Fund’s) investments in commodity-linked financial derivative instruments may subject the Fund (or Acquired Fund) to greater market price volatility than investments in traditional securities. The value of commodity-linked financial derivative instruments may be affected by overall market movements, commodity index volatility, changes in interest rates, or factors affecting a particular industry or commodity, such as drought, floods, weather, livestock disease, embargoes, tariffs and international economic, political and regulatory developments.
Credit and Counterparty Risks A Fund (or Acquired Funds) will be exposed to credit risk to parties with whom it trades and will also bear the risk of settlement default. A Fund (or Acquired Funds) minimizes
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concentrations of credit risk by undertaking transactions with a large number of customers and counterparties on recognized and reputable exchanges, where applicable. For financial derivative instruments traded on exchanges or clearinghouses, the primary credit risk is the creditworthiness of a Fund’s clearing broker or the exchange or clearinghouse itself. A Fund (or Acquired Funds) could lose money if the issuer or guarantor of a fixed income security, or the counterparty to a financial derivative instruments contract, repurchase agreement or a loan of portfolio securities, is unable or unwilling to make timely principal and/or interest payments, or to otherwise honor its obligations. Securities and financial derivative instruments are subject to varying degrees of credit risk, which may be reflected in credit ratings.
Similar to credit risk, a Fund (or Acquired Funds) may be exposed to counterparty risk, or the risk that an institution or other entity with which the Fund (or Acquired Funds) has unsettled or open transactions will default. PIMCO, as the Adviser, minimizes counterparty risks to the Funds (or Acquired Funds) through a number of ways. Prior to entering into transactions with a new counterparty, the PIMCO Counterparty Risk Committee conducts an extensive credit review of such counterparty and must approve the use of such counterparty. Furthermore, pursuant to the terms of the underlying contract, to the extent that unpaid amounts owed to a Fund (or Acquired Funds) exceed a predetermined threshold, such counterparty shall advance collateral to the Fund (or Acquired Funds) in the form of cash or securities equal in value to the unpaid amount owed to the Fund (or Acquired Funds). A Fund (or Acquired Funds) may invest such collateral in securities or other instruments and will typically pay interest to the counterparty on the collateral received. If the unpaid amount owed to a Fund (or Acquired Funds) subsequently decreases, the Fund (or Acquired Funds) would be required to return to the counterparty all or a portion of the collateral previously advanced.
All transactions in listed securities are settled/paid for upon delivery using approved counterparties. The risk of default is considered minimal, as delivery of securities sold is only made once a Fund (or Acquired Funds) has received payment. Payment is made on a purchase once the securities have been delivered by the counterparty. The trade will fail if either party fails to meet its obligation.
Master Netting Arrangements A Fund may be subject to various netting arrangements (“Master Agreements”) with select counterparties. Master Agreements govern the terms of certain transactions, and reduce the counterparty risk associated with relevant transactions by specifying credit protection mechanisms and providing standardization that improves legal certainty. Each type of Master Agreement governs certain types of transactions. Different types of transactions may be traded out of different legal entities or affiliates of a particular organization, resulting in the need for multiple agreements
with a single counterparty. As the Master Agreements are specific to unique operations of different asset types, they allow a Fund to close out and net its total exposure to a counterparty in the event of a default with respect to all the transactions governed under a single Master Agreement with a counterparty. For financial reporting purposes the Statements of Assets and Liabilities generally present derivative assets and liabilities on a gross basis, which reflects the full risks and exposures prior to netting.
Master Agreements can also help limit counterparty risk by specifying collateral posting arrangements at pre-arranged exposure levels. Under most Master Agreements, collateral is routinely transferred if the total net exposure to certain transactions (net of existing collateral already in place) governed under the relevant Master Agreement with a counterparty in a given account exceeds a specified threshold, which typically ranges from zero to $250,000 depending on the counterparty and the type of Master Agreement. United States Treasury Bills and U.S. dollar cash are generally the preferred forms of collateral, although other forms of AAA rated paper or sovereign securities may be used depending on the terms outlined in the applicable Master Agreement. Securities and cash pledged as collateral are reflected as assets on the Statements of Assets and Liabilities as either a component of Investments at value (securities) or Deposits with counterparty. Cash collateral received is not typically held in a segregated account and as such is reflected as a liability on the Statements of Assets and Liabilities as Deposits from counterparty. The market value of any securities received as collateral is not reflected as a component of NAV. A Fund’s overall exposure to counterparty risk can change substantially within a short period, as it is affected by each transaction subject to the relevant Master Agreement.
Master Repurchase Agreements and Global Master Repurchase Agreements (individually and collectively “Master Repo Agreements”) govern repurchase, reverse repurchase, and sale-buyback transactions between a Fund and select counterparties. Master Repo Agreements maintain provisions for, among other things, initiation, income payments, events of default, and maintenance of collateral. The market value of transactions under the Master Repo Agreement, collateral pledged or received, and the net exposure by counterparty as of period end are disclosed in the Notes to Schedules of Investments.
Master Securities Forward Transaction Agreements (“Master Forward Agreements”) govern certain forward settling transactions, such as To-Be-Announced securities, delayed-delivery or sale-buyback transactions by and between a Fund and select counterparties. The Master Forward Agreements maintain provisions for, among other things, initiation and confirmation, payment and transfer, events of default, termination, and maintenance of collateral. The market value of forward settling
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transactions, collateral pledged or received, and the net exposure by counterparty as of period end is disclosed in the Notes to Schedules of Investments.
Customer Account Agreements and related addenda govern cleared derivatives transactions such as futures, options on futures, and cleared over the counter (“OTC”) derivatives. Such transactions require posting of initial margin as determined by each relevant clearing agency which is segregated in an account at a futures commission merchant (“FCM”) registered with the Commodity Futures Trading Commission (“CFTC”). In the United States, counterparty risk is significantly reduced as creditors of an FCM cannot have a claim to Fund assets in the segregated account. Additionally, portability of exposure in the event of an FCM default scenario further reduces risk to the Funds. Variation margin, or changes in market value, are exchanged daily, but may not be netted between futures and cleared OTC derivatives. The market value or accumulated unrealized appreciation (depreciation), initial margin posted, and any unsettled variation margin as of period end is disclosed in the Notes to Schedules of Investments.
International Swaps and Derivatives Association, Inc. Master Agreements and Credit Support Annexes (“ISDA Master Agreements”) govern bilateral OTC derivative transactions entered into by a Fund with select counterparties. ISDA Master Agreements maintain provisions for general obligations, representations, agreements, collateral and events of default or termination. Events of termination include conditions that may entitle counterparties to elect to terminate early and cause settlement of all outstanding transactions under the applicable ISDA Master Agreement. Any election to terminate early could be material to the financial statements. In limited circumstances, the ISDA Master Agreement may contain additional provisions that add counterparty protection beyond coverage of existing daily exposure if the counterparty has a decline in credit quality below a predefined level. These amounts, if any, may be segregated with a third-party custodian. The market value of OTC financial derivative instruments, collateral received or pledged, and net exposure by counterparty as of period end are disclosed in the Notes to Schedules of Investments.
7. FEES AND EXPENSES
(a) Investment Advisory Fee PIMCO is a majority-owned subsidiary of Allianz Asset Management of America L.P. (“Allianz Asset Management”) and serves as the Adviser to the Trust, pursuant to an investment advisory contract. The Adviser receives a monthly fee from each Fund at an annual rate based on average daily net assets (the “Investment Advisory Fee”). The Investment Advisory Fee for all classes is charged at an annual rate as noted in the table below.
(b) Supervisory and Administrative Fee PIMCO serves as administrator (the “Administrator”) and provides supervisory and administrative services to the Trust for which it receives a monthly supervisory and administrative fee based on each share class’s average daily net assets (the “Supervisory and Administrative Fee”). As the Administrator, PIMCO bears the costs of various third-party services, including audit, custodial, portfolio accounting, legal, transfer agency and printing costs.
The Investment Advisory Fees and Supervisory and Administrative Fees for all classes are charged at an annual rate as noted in the following table:
Investment Advisory Fee | Supervisory and Administrative Fee | |||||||||||||||||||
Fund Name | All Classes | Institutional Class | Class P | A and C Classes | ||||||||||||||||
PIMCO RAE Fundamental Emerging Markets Fund | 0.50% | 0.45% | 0.55% | 0.55% | ||||||||||||||||
PIMCO RAE Fundamental Global Fund | 0.40% | 0.30% | 0.40% | 0.40% | ||||||||||||||||
PIMCO RAE Fundamental Global ex-US Fund | 0.40% | 0.35% | 0.45% | 0.45% | ||||||||||||||||
PIMCO RAE Fundamental International Fund | 0.30% | 0.30% | 0.40% | 0.40% | ||||||||||||||||
PIMCO RAE Fundamental US Fund | 0.25% | 0.25% | 0.35% | 0.40% | ||||||||||||||||
PIMCO RAE Fundamental US Small Fund | 0.35% | 0.25% | 0.35% | 0.40% |
(c) Distribution and Servicing Fees PIMCO Investments LLC (“PI”), a wholly-owned subsidiary of PIMCO, serves as the distributor (“Distributor”) of the Trust’s shares.
The Trust has adopted separate Distribution and Servicing Plans with respect to the Class A, Class C and Class R shares of the Trust pursuant to Rule 12b-1 under the Act. In connection with the distribution of Class C and Class R shares of the Trust, the Distributor receives
distribution fees from the Trust of up to 0.75% for Class C shares and 0.25% for Class R shares, and in connection with personal services rendered to Class A, Class C and Class R shareholders and the maintenance of such shareholder accounts, the Distributor receives servicing fees from the Trust of up to 0.25% for each of Class A, Class C and Class R shares (percentages reflect annual rates of the average daily net assets attributable to the applicable class).
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The Trust has adopted a Distribution and Servicing Plan with respect to the Class D shares of each Fund pursuant to Rule 12b-1 under the Act (the “Class D Plan”). Under the terms of the Class D Plan, a Fund is permitted to compensate the Distributor out of the assets attributable to the Class D shares of the Fund, in an amount up to 0.25% on an annual basis of the average daily net assets of the Fund’s Class D shares for providing, or procuring through financial intermediaries, distribution, shareholder services, and/or maintenance of shareholder accounts with respect to Class D shareholders of the Fund, some of which may be deemed to be primarily intended to result in the sale of Class D shares.
The Trust has adopted a Distribution and Servicing Plan with respect to the Administrative Class shares of each Fund pursuant to Rule 12b-1 under the Act (the “Administrative Class Plan”). Under the terms of the Administrative Class Plan, a Fund may compensate the Distributor for providing, or procuring through financial intermediaries, distribution, administrative, recordkeeping, shareholder and/or related services with respect to Administrative Class shares. The Administrative Class Plan permits a Fund to make total payments at an annual rate of up to 0.25% of the average daily net assets attributable to the Administrative Class shares.
The Trust paid distribution and servicing fees at effective rates as set forth in the following table (calculated as a percentage of each Fund’s average daily net assets attributable to each class):
Distribution Fee | Servicing Fee | |||||||||
Administrative Class | — | 0.25% | ||||||||
Class D | — | 0.25% | ||||||||
Class A | — | 0.25% | ||||||||
Class C | 0.75% | 0.25% | ||||||||
Class R | 0.25% | 0.25% |
The Distributor also received the proceeds of the initial sales charges paid by the shareholders upon the purchase of Class A shares and the contingent deferred sales charges paid by the shareholders upon certain redemptions of Class A and Class C shares. For the period ended December 31, 2015, the Distributor retained $108,108 representing commissions (sales charges) and contingent deferred sales charges from the Trust.
(d) Fund Expenses PIMCO provides or procures supervisory and administrative services for shareholders and also bears the costs of various third-party services required by the Funds, including audit, custodial, portfolio accounting, legal, transfer agency and printing costs. The Trust is responsible for the following expenses: (i) taxes and governmental fees; (ii) brokerage fees and commissions and other portfolio transaction expenses; (iii) the costs of borrowing money, including interest expense; (iv) fees and expenses of the Trustees who are not “interested persons” of PIMCO or the Trust, and any counsel
retained exclusively for their benefit; (v) extraordinary expense, including costs of litigation and indemnification expenses; (vi) organizational expenses; and (vii) any expenses allocated or allocable to a specific class of shares, which include service fees payable with respect to the Administrative Class Shares, and may include certain other expenses as permitted by the Trust’s Multi-Class Plan adopted pursuant to Rule 18f-3 under the Act and subject to review and approval by the Trustees. The ratio of expenses to average net assets per share class, as disclosed on the Financial Highlights, may differ from the annual fund operating expenses per share class as disclosed in the Prospectus.
Each Trustee, other than those affiliated with PIMCO or its affiliates, receives an annual retainer of $62,000, plus $6,250 for each Board meeting attended in person, $375 ($750 in the case of the audit committee chair with respect to audit committee meetings) for each committee meeting attended and $750 for each Board meeting attended telephonically, plus reimbursement of related expenses. In addition, the audit committee chair receives an additional annual retainer of $9,000, the valuation oversight committee lead receives an additional annual retainer of $2,000 (to the extent there are co-leads of the valuation oversight committee, the annual retainer will be split evenly between the co-leads) and the governance committee chair receives an additional annual retainer of $750.
These expenses are allocated on a pro rata basis to each Fund of the Trust according to its respective net assets. The Trust pays no compensation directly to any Trustee or any other officer who is affiliated with the Administrator, all of whom receive remuneration for their services to the Trust from the Administrator or its affiliates.
(e) Expense Limitation PIMCO has agreed to waive a portion of the Funds’ Supervisory and Administrative Fees in each Fund’s first fiscal year, to the extent that the payment of each Fund’s pro rata share of organizational expenses and Trustee Fees cause the actual expense ratio to rise above the rates disclosed in the then-current prospectus plus 0.0049%, the “Expense Limit” (calculated as a percentage of each Fund’s average daily net assets attributable to each class).
PIMCO has contractually agreed to waive a portion of the Investment Advisory Fee as set forth in the following table (calculated as a percentage of each Fund’s average daily net assets).
Fund Name | Fee Waiver | Expiration Date | ||||||||
PIMCO RAE Fundamental Emerging Markets Fund | 0.20% | 10/31/2016 | ||||||||
PIMCO RAE Fundamental Global Fund | 0.20% | 10/31/2016 | ||||||||
PIMCO RAE Fundamental Global ex-US Fund | 0.20% | 10/31/2016 | ||||||||
PIMCO RAE Fundamental International Fund | 0.10% | 10/31/2016 | ||||||||
PIMCO RAE Fundamental US Fund | 0.10% | 10/31/2016 | ||||||||
PIMCO RAE Fundamental US Small Fund | 0.10% | 10/31/2016 |
Under the Fee Limitation Agreement, PIMCO is entitled to reimbursement by each Fund of any portion of the Supervisory and
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Administrative Fee and/or Investment Advisory Fee waived, reduced or reimbursed pursuant to the Fee Limitation Agreement or the Expense Limitation Agreement, respectively (the “Reimbursement Amount”) during the previous three years, provided that such amount paid to PIMCO will not: 1) together with any recoupment of organizational expenses and pro rata Trustees’ fees pursuant to the Expense Limitation Agreement, exceed the Expense Limit; 2) exceed the total Reimbursement Amount; or 3) include any amounts previously reimbursed to PIMCO. The Fee Limitation Agreement will automatically renew for one-year terms unless PIMCO provides written notice to the Trust at least 30 days prior to the end of the then current term.
PIMCO may be reimbursed for these waived amounts in future periods, not to exceed thirty-six months after the waiver. Expenses that have been waived may still be reimbursed by the Administrator, to the extent the Fund’s annualized total portfolio operating expenses plus the amount reimbursed does not exceed the Expense Limit. The recoverable amounts to PIMCO at December 31, 2015, were as follows (amounts in thousands):
Fund Name | Recoverable Amounts | |||||
PIMCO RAE Fundamental Emerging Markets Fund | $ | 254 | ||||
PIMCO RAE Fundamental Global Fund | 127 | |||||
PIMCO RAE Fundamental Global ex-US Fund | 131 | |||||
PIMCO RAE Fundamental International Fund | 150 | |||||
PIMCO RAE Fundamental US Fund | 318 | |||||
PIMCO RAE Fundamental US Small Fund | 110 |
(f) Acquired Fund Fees and Expenses The Underlying Fund expenses for the Funds are based upon an allocation of a Fund’s assets among the Underlying Funds and upon the total annual operating expenses of the Institutional Class shares of these Underlying Funds. Underlying Fund expenses for the Funds will vary with changes in the expenses of the Underlying Funds, as well as the allocation of a Fund’s assets.
PIMCO has contractually agreed, through October 31, 2016, to waive, first, the Investment Advisory Fee and, second, the Supervisory and Administrative Fees it receives from the PIMCO RAE Fundamental Global Fund in an amount equal to the expenses attributable to the Investment Advisory Fees and the Supervisory and Administrative Fees of the PIMCO RAE Fundamental US Fund, PIMCO RAE Fundamental International Fund and PIMCO RAE Fundamental Emerging Markets Fund indirectly incurred by the PIMCO RAE Fundamental Global Fund in connection with its investments in such Funds, to the extent the PIMCO RAE Fundamental Global Fund’s Investment Advisory Fee and Supervisory and Administrative Fees are greater than or equal to the Investment Advisory Fee and Supervisory and Administrative Fees of such Funds. This waiver renews annually for a full year unless terminated by PIMCO upon at least 30 days’ notice prior to the end of the contract term.
PIMCO has contractually agreed, through October 31, 2016, to waive, first, the Investment Advisory Fee and, second, the Supervisory and Administrative Fee it receives from the PIMCO RAE Fundamental Global ex-US Fund in an amount equal to the expenses attributable to the Investment Advisory Fees and the Supervisory and Administrative Fees of the PIMCO RAE Fundamental International Fund and PIMCO RAE Fundamental Emerging Markets Fund indirectly incurred by the PIMCO RAE Fundamental Global ex-US Fund in connection with its investments in such Funds, to the extent the PIMCO RAE Fundamental Global ex-US Fund’s Investment Advisory Fee and Supervisory and Administrative Fee are greater than or equal to the Investment Advisory Fees and Supervisory and Administrative Fees of such Funds. This waiver renews annually for a full year unless terminated by PIMCO upon at least 30 days’ notice prior to the end of the contract term.
The waivers are reflected on the Statements of Operations as a component of Waiver and/or Reimbursement by PIMCO. During the period ended December 31, 2015, the Funds below waived the following fees (amounts in thousands):
Fund Name | Waived Fees | |||||
PIMCO RAE Fundamental Global Fund | $ | 150 | ||||
PIMCO RAE Fundamental Global ex-US Fund | 183 |
8. RELATED PARTY TRANSACTIONS
The Adviser, Administrator, and Distributor are related parties. Fees payable to these parties are disclosed in Note 7 and the accrued related party fee amounts are disclosed on the Statements of Assets and Liabilities.
9. GUARANTEES AND INDEMNIFICATIONS
Under the Trust’s organizational documents, each Trustee or officer of the Trust is indemnified and each employee or other agent of the Trust (including the Trust’s investment manager) may be indemnified, to the extent permitted by the Act, against certain liabilities that may arise out of performance of their duties to the Funds. Additionally, in the normal course of business, the Funds enter into contracts that contain a variety of indemnification clauses. The Funds’ maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Funds that have not yet occurred. However, the Funds have not had prior claims or losses pursuant to these contracts.
10. PURCHASES AND SALES OF SECURITIES
The length of time a Fund has held a particular security is not generally a consideration in investment decisions. A change in the securities held by a Fund is known as “portfolio turnover.” Each Fund may engage in frequent and active trading of portfolio securities to achieve its investment objective, particularly during periods of volatile market movements. High portfolio turnover may involve correspondingly
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greater transaction costs to a Fund, including brokerage commissions or dealer mark-ups and other transaction costs on the sale of securities and reinvestments in other securities. Such sales may also result in realization of taxable capital gains, including short-term capital gains
(which are generally taxed at ordinary income tax rates). The transaction costs and tax effects associated with portfolio turnover may adversely affect a Fund’s performance. The portfolio turnover rates are reported in the Financial Highlights.
Purchases and sales of securities (excluding short-term investments) for the period ended December 31, 2015, were as follows (amounts in thousands†):
U.S. Government/Agency | All Other | |||||||||||||||||
Fund Name | Purchases | Sales | Purchases | Sales | ||||||||||||||
PIMCO RAE Fundamental Emerging Markets Fund | $ | 0 | $ | 0 | $ | 49,947 | $ | 36,070 | ||||||||||
PIMCO RAE Fundamental Global Fund | 0 | 0 | 183,514 | 3,763 | ||||||||||||||
PIMCO RAE Fundamental Global ex-US Fund | 0 | 0 | 4,145 | 2,282 | ||||||||||||||
PIMCO RAE Fundamental International Fund | 0 | 0 | 89,554 | 20,128 | ||||||||||||||
PIMCO RAE Fundamental US Fund | 0 | 0 | 188,074 | 126,218 | ||||||||||||||
PIMCO RAE Fundamental US Small Fund | 0 | 0 | 112,055 | 46,191 | ||||||||||||||
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
11. SHARES OF BENEFICIAL INTEREST
The Trust may issue an unlimited number of shares of beneficial interest with a $0.0001 par value. Changes in shares of beneficial interest were as follows (shares and amounts in thousands†):
PIMCO RAE Fundamental Emerging Markets Fund (1) | PIMCO RAE Fundamental Global Fund (2) | PIMCO RAE Fundamental Global ex-US Fund (3) | ||||||||||||||||||||||||||||||||||||||||||||||||
Six Months Ended 12/31/2015 (Unaudited) | Inception date through June 30, 2015 | Six Months Ended 12/31/2015 (Unaudited) | Inception date through June 30, 2015 | Six Months Ended 12/31/2015 (Unaudited) | Inception date through June 30, 2015 | |||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||||||||||||||
Receipts for shares sold | ||||||||||||||||||||||||||||||||||||||||||||||||||
Institutional Class | 4,795 | $ | 39,135 | 193 | $ | 2,417 | 18,974 | $ | 175,495 | 2 | $ | 26 | 37 | $ | 308 | 0 | $ | 0 | ||||||||||||||||||||||||||||||||
Class P | 331 | 2,540 | 1 | 10 | 0 | 2 | 1 | 10 | 0 | 0 | 1 | 10 | ||||||||||||||||||||||||||||||||||||||
Class A | 7 | 61 | 2 | 19 | 16 | 148 | 1 | 10 | 0 | 0 | 1 | 10 | ||||||||||||||||||||||||||||||||||||||
Class C | 3 | 31 | 1 | 10 | 31 | 285 | 2 | 17 | 1 | 5 | 1 | 10 | ||||||||||||||||||||||||||||||||||||||
Issued as reinvestment of distributions | ||||||||||||||||||||||||||||||||||||||||||||||||||
Institutional Class | 422 | 3,228 | 0 | 0 | 234 | 2,108 | 0 | 0 | 84 | 720 | 0 | 0 | ||||||||||||||||||||||||||||||||||||||
Class P | 8 | 60 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||||||
Class A | 0 | 1 | 0 | 0 | 0 | 2 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||||||
Class C | 0 | 0 | 0 | 0 | 0 | 3 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||||||
Issued in reorganization^ | ||||||||||||||||||||||||||||||||||||||||||||||||||
Institutional Class | 0 | 0 | 19,842 | 198,415 | 0 | 0 | 3,869 | 38,691 | 0 | 0 | 7,106 | 71,057 | ||||||||||||||||||||||||||||||||||||||
Cost of shares redeemed | ||||||||||||||||||||||||||||||||||||||||||||||||||
Institutional Class | (2,125 | ) | (16,826 | ) | 0 | 0 | (222 | ) | (2,001 | ) | 0 | 0 | (4 | ) | (31 | ) | 0 | 0 | ||||||||||||||||||||||||||||||||
Class P | (9 | ) | (73 | ) | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||||
Class A | (1 | ) | (8 | ) | 0 | 0 | (0 | ) | (1 | ) | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||
Class C | (1 | ) | (10 | ) | 0 | 0 | (1 | ) | (10 | ) | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||
Net increase (decrease) resulting from Fund share transactions | 3,430 | $ | 28,139 | 20,039 | $ | 200,871 | 19,032 | $ | 176,031 | 3,875 | $ | 38,754 | 118 | $ | 1,002 | 7,109 | $ | 71,087 | ||||||||||||||||||||||||||||||||
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Notes to Financial Statements (Cont.)
PIMCO RAE Fundamental International Fund (4) | PIMCO RAE Fundamental US Fund (5) | PIMCO RAE Fundamental US Small Fund (6) | ||||||||||||||||||||||||||||||||||||||||||||||||
Six Months Ended 12/31/2015 (Unaudited) | Inception date through June 30, 2015 | Six Months Ended 12/31/2015 (Unaudited) | Inception date through June 30, 2015 | Six Months Ended 12/31/2015 (Unaudited) | Inception date through June 30, 2015 | |||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||||||||||||||
Receipts for shares sold | ||||||||||||||||||||||||||||||||||||||||||||||||||
Institutional Class | 7,760 | $ | 70,823 | 6 | $ | 210 | 15,169 | $ | 147,519 | 63 | $ | 615 | 10,148 | $ | 92,648 | 0 | $ | 0 | ||||||||||||||||||||||||||||||||
Class P | 137 | 1,234 | 1 | 10 | 244 | 2,323 | 1 | 10 | 21 | 183 | 1 | 10 | ||||||||||||||||||||||||||||||||||||||
Class A | 0 | 4 | 1 | 10 | 176 | 1,682 | 1 | 14 | 44 | 418 | 1 | 10 | ||||||||||||||||||||||||||||||||||||||
Class C | 19 | 159 | 1 | 10 | 43 | 403 | 1 | 10 | 15 | 136 | 1 | 10 | ||||||||||||||||||||||||||||||||||||||
Issued as reinvestment of distributions | ||||||||||||||||||||||||||||||||||||||||||||||||||
Institutional Class | 595 | 5,154 | 0 | 0 | 1,786 | 16,713 | 0 | 0 | 200 | 1,786 | 0 | 0 | ||||||||||||||||||||||||||||||||||||||
Class P | 3 | 25 | 0 | 0 | 7 | 64 | 0 | 0 | 0 | 3 | 0 | 0 | ||||||||||||||||||||||||||||||||||||||
Class A | 0 | 0 | 0 | 0 | 5 | 46 | 0 | 0 | 1 | 5 | 0 | 0 | ||||||||||||||||||||||||||||||||||||||
Class C | 0 | 2 | 0 | 0 | 1 | 9 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||||||
Issued in reorganization^ | ||||||||||||||||||||||||||||||||||||||||||||||||||
Institutional Class | 0 | 0 | 15,659 | 156,592 | 0 | 0 | 45,448 | 454,480 | 0 | 0 | 4,677 | 46,771 | ||||||||||||||||||||||||||||||||||||||
Cost of shares redeemed | ||||||||||||||||||||||||||||||||||||||||||||||||||
Institutional Class | (564 | ) | (5,039 | ) | (257 | ) | (2,540 | ) | (10,086 | ) | (96,156 | ) | (71 | ) | (701 | ) | (3,076 | ) | (27,951 | ) | 0 | 0 | ||||||||||||||||||||||||||||
Class P | (27 | ) | (254 | ) | 0 | 0 | (55 | ) | (529 | ) | 0 | 0 | (3 | ) | (24 | ) | 0 | 0 | ||||||||||||||||||||||||||||||||
Class A | (0 | ) | (4 | ) | 0 | 0 | (10 | ) | (90 | ) | 0 | 0 | (35 | ) | (308 | ) | 0 | 0 | ||||||||||||||||||||||||||||||||
Class C | 0 | 0 | 0 | 0 | (2 | ) | (16 | ) | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||||
Net increase (decrease) resulting from Fund share transactions | | 7,923 | | $ | 72,104 | 15,411 | $ | 154,292 | 7,278 | $ | 71,968 | 45,443 | $ | 454,428 | 7,315 | $ | 66,896 | 4,680 | $ | 46,801 | ||||||||||||||||||||||||||||||
^ | On June 5, 2015, each Fund acquired substantially all of the assets and assumed certain liabilities of a corresponding privately offered fund managed by Research Affiliates in exchange for Institutional Class shares of each Fund pursuant to the terms and conditions of an Agreement and Plan of Reorganization and Exchange. |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
(1) | As of December 31, 2015, two shareholders owned 10% or more of the Fund’s total outstanding shares comprising 34% of the Fund. One shareholder is a related party and comprises 10% of the Fund.* |
(2) | As of December 31, 2015, one shareholder owned 10% or more of the Fund’s total outstanding shares comprising 12% of the Fund. |
(3) | As of December 31, 2015, two shareholders owned 10% or more of the Fund’s total outstanding shares comprising 99% of the Fund. |
(4) | As of December 31, 2015, four shareholders each owned 10% or more of the Fund’s total outstanding shares comprising 90% of the Fund. Two of the shareholders are related parties and comprise 61% of the Fund.* |
(5) | As of December 31, 2015, one shareholder owned 10% or more of the Fund’s total outstanding shares comprising 23% of the Fund, and the shareholder is a related party of the Fund.* |
(6) | As of December 31, 2015, four shareholders each owned 10% or more of the Fund’s total outstanding shares comprising 85% of the Fund. |
* | Related parties may include, but are not limited to, the investment manager and its affiliates, affiliated broker dealers, fund of funds and directors or employees of the Trust or Adviser. |
12. REGULATORY AND LITIGATION MATTERS
The Funds are not named as defendants in any material litigation or arbitration proceedings and are not aware of any material litigation or claim pending or threatened against them.
PIMCO has received a Wells Notice from the staff of the U.S. Securities and Exchange Commission (“SEC”) that relates to the PIMCO Total Return Active Exchange-Traded Fund (“BOND”), a series of PIMCO ETF Trust. The notice indicates the staff’s preliminary determination to recommend that the SEC commence a civil action against PIMCO stemming from a non-public investigation relating to BOND. A Wells Notice is neither a formal allegation of wrongdoing nor a finding that any law was violated.
This matter principally pertains to the valuation of smaller sized positions in non-agency mortgage-backed securities purchased by BOND between its inception on February 29, 2012 and June 30, 2012,
BOND’s performance disclosures for that period, and PIMCO’s compliance policies and procedures related to these matters.
The Wells process provides PIMCO with the opportunity to demonstrate to the SEC staff why it believes its conduct was appropriate, in keeping with industry standards, and that no action should be taken. PIMCO believes that this matter is unlikely to have a material adverse effect on any Fund or on PIMCO’s ability to provide investment management services to any Fund.
The foregoing speaks only as of the date of this report.
13. FEDERAL INCOME TAX MATTERS
Each Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code (the “Code”) and distribute all of its taxable income and net realized gains, if applicable, to shareholders. Accordingly, no provision for Federal income taxes has been made.
76 | PIMCO EQUITY SERIES |
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December 31, 2015 (Unaudited)
A Fund may be subject to local withholding taxes, including those imposed on realized capital gains. Any applicable foreign capital gains tax is accrued daily based upon net unrealized gains, and may be payable following the sale of any applicable investments.
In accordance with U.S. GAAP, the Adviser has reviewed the Funds’ tax positions for all open tax years. As of December 31, 2015, the Funds have recorded no liability for net unrecognized tax benefits relating to uncertain income tax positions they have taken or expect to take in future tax returns.
The Funds file U.S. tax returns. While the statute of limitations remains open to examine the Funds’ U.S. tax returns filed for the fiscal years
ending in 2012-2014, no examinations are in progress or anticipated at this time. The Funds are not aware of any tax positions for which it is reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
Under the Regulated Investment Company Act of 2010, a fund is permitted to carry forward any new capital losses for an unlimited period. Additionally, such capital losses that are carried forward will retain their character as either short-term or long-term capital losses rather than being considered all short-term under previous law.
As of June 30, 2015, the Funds had the following post-effective capital losses with no expiration (amounts in thousands):
Short-Term | Long-Term | |||||||||
PIMCO RAE Fundamental Emerging Markets Fund | $ | 1,209 | $ | 467 | ||||||
PIMCO RAE Fundamental Global Fund | 11 | — | ||||||||
PIMCO RAE Fundamental Global Ex-US Fund | 21 | — | ||||||||
PIMCO RAE Fundamental International Fund | — | — | ||||||||
PIMCO RAE Fundamental US Fund | — | — | ||||||||
PIMCO RAE Fundamental US Small Fund | — | — |
As of December 31, 2015, the aggregate cost and the net unrealized appreciation (depreciation) of investments for federal income tax purposes are as follows (amounts in thousands†):
Fund Name | Federal Tax Cost | Aggregate Gross Unrealized Appreciation | Aggregate Gross Unrealized (Depreciation) | Net Unrealized Appreciation (Depreciation) (1) | ||||||||||||||
PIMCO RAE Fundamental Emerging Markets Fund | $ | 233,691 | $ | 4,642 | $ | (51,987 | ) | $ | (47,345 | ) | ||||||||
PIMCO RAE Fundamental Global Fund | 218,338 | 0 | (13,790 | ) | (13,790 | ) | ||||||||||||
PIMCO RAE Fundamental Global ex-US Fund | 72,433 | 0 | (11,185 | ) | (11,185 | ) | ||||||||||||
PIMCO RAE Fundamental International Fund | 199,271 | 19,586 | (17,059 | ) | 2,527 | |||||||||||||
PIMCO RAE Fundamental US Fund | 422,165 | 82,424 | (18,482 | ) | 63,942 | |||||||||||||
PIMCO RAE Fundamental US Small Fund | 104,830 | 6,740 | (5,659 | ) | 1,081 |
(1) | Primary differences, if any, between book and tax net unrealized appreciation (depreciation) are attributable to wash sale loss deferrals. |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
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Glossary: (abbreviations that may be used in the preceding statements)
(Unaudited)
Counterparty Abbreviations: | ||||||||||
SSB | State Street Bank and Trust Co. | |||||||||
Currency Abbreviations: | ||||||||||
BRL | Brazilian Real | USD (or $) | United States Dollar | ZAR | South African Rand | |||||
Other Abbreviations: | ||||||||||
ADR | American Depositary Receipt | REIT | Real Estate Investment Trust | SP-GDR | Sponsored Global Depositary Receipt | |||||
GDR | Global Depositary Receipt | SP-ADR | Sponsored American Depositary Receipt |
78 | PIMCO EQUITY SERIES |
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Approval of Investment Advisory Contract and Other Agreements
(Unaudited)
Approval of Renewal of the Investment Advisory Contract and Second Amended and Restated Supervision and Administration Agreement
At a meeting held on August 12, 2015, the Board of Trustees (the “Board”) of PIMCO Equity Series (the “Trust”), including all of the Trustees who are not “interested persons” of the Trust under the Investment Company Act of 1940, as amended (the “Independent Trustees”), considered and unanimously approved the Investment Advisory Contract (the “Investment Advisory Contract”) between the Trust, on behalf of each of the Trust’s series (the “Funds”), and Pacific Investment Management Company LLC (“PIMCO”) for an additional one-year term through August 31, 2016. The Board also considered and unanimously approved for an additional one-year term through August 31, 2016, the Second Amended and Restated Supervision and Administration Agreement (the “Supervision and Administration Agreement” and together with the Investment Advisory Contract, the “Agreements”) between the Trust, on behalf of the Funds, and PIMCO.
The information, material factors and conclusions that formed the basis for the Board’s approvals are summarized below.
1. INFORMATION RECEIVED
(a) Materials Reviewed: During the course of the past year, the Trustees received a wide variety of materials relating to the services provided by PIMCO to the Trust. At each of its quarterly meetings, the Board reviewed the Funds’ investment performance and a significant amount of information relating to Fund operations, including shareholder services, valuation and custody, the Funds’ compliance program and other information relating to the nature, extent and quality of services provided by PIMCO to the Trust. In considering whether to approve the renewal of the Agreements, the Board also reviewed supplementary information, including, but not limited to, comparative industry data with regard to investment performance, advisory and supervisory and administrative fees and expenses, financial information for PIMCO, information regarding the profitability to PIMCO of its relationship with the Funds, information about the personnel providing investment management services, other advisory services and supervisory and administrative services to the Funds, and information about the fees charged and services provided to other clients with similar investment mandates as the Funds (where applicable). In addition, the Board reviewed materials provided by counsel to the Trust and the Independent Trustees, which included, among other things, memoranda outlining legal duties of the Board in considering the continuation of the Agreements.
(b) Review Process: In connection with the renewal of the Agreements, the Board reviewed written materials prepared by PIMCO in response to requests from counsel to the Trust and the Independent Trustees. The Board requested and received assistance and advice regarding applicable legal standards from counsel to the Trust and the
Independent Trustees, and reviewed comparative fee and performance data prepared at the Board’s request by Lipper, Inc. (“Lipper”), an independent provider of investment company performance and fee and expense data. The Board heard oral presentations on matters related to the Agreements and met both as a full Board and in a separate session of the Independent Trustees, without management present, at the August 12, 2015 meeting. The Independent Trustees also conducted a telephonic meeting with counsel to the Trust and the Independent Trustees on July 30, 2015 to discuss the materials presented. In addition, the Independent Trustees requested and received from PIMCO additional information including, but not limited to, information related to profitability and comparative performance information.
The approval determinations were made on the basis of each Trustee’s business judgment after consideration of all the information presented. Individual Trustees may have given different weights to certain factors and assigned various degrees of materiality to information received in connection with the approval process. In deciding to approve the renewal of the Agreements, the Board did not identify any single factor or particular information that, in isolation, was controlling. This summary describes the most important, but not all, of the factors considered by the Board.
2. NATURE, EXTENT AND QUALITY OF SERVICES
(a) PIMCO, its Personnel, and Resources: The Board considered the depth and quality of PIMCO’s investment management process, including: the experience, capability and integrity of its senior management and other personnel; the overall financial strength and stability of its organization; and the ability of its organizational structure to address changes in assets under management. The Board also considered the various services in addition to portfolio management that PIMCO provides under the Investment Advisory Contract. The Board noted that PIMCO makes available to its investment professionals a variety of resources and systems relating to investment management, compliance, trading, performance and portfolio accounting. The Board also noted that PIMCO is making a long-term commitment to building an equity asset management platform, and that PIMCO continues to invest in personnel and global infrastructure necessary to support the equity business. In this regard, the Board considered PIMCO’s commitment to investing in information technology supporting investment management and compliance, as well as PIMCO’s continuing efforts to attract and retain qualified personnel, including personnel with relevant equities experience, and to maintain and enhance its resources and systems. The Board considered PIMCO’s policies, procedures and systems to reasonably assure compliance with applicable laws and regulations and its
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Approval of Investment Advisory Contract and Other Agreements (Cont.)
commitment to these programs, its oversight of matters that may involve conflicts of interest between the Funds’ investments and those of other accounts managed by PIMCO, and its efforts to keep the Trustees informed about matters relevant to the Funds and their shareholders. The Board also considered PIMCO’s continuous investment in new disciplines and talented personnel, which has enhanced PIMCO’s service to the Funds and has allowed PIMCO to introduce innovative new funds over time.
The Trustees considered information they had received about the steps that PIMCO has taken in recent years with respect to active management of counterparty risk, such as implementing procedures requiring daily collateral adjustments and frequent communication between credit analysts and the counterparty risk committee, which oversees counterparty risk on a firm-wide basis, continually evaluating requests to add or remove approved counterparties as market needs and conditions warrant. The Trustees also considered that, over the last several years, PIMCO has continued to strengthen the process it uses to assess the financial stability of counterparties with which the Funds do business, to manage collateral and to protect portfolios from an unforeseen deterioration in the creditworthiness of trading counterparties. The Trustees noted that, consistent with its fiduciary duty, PIMCO executes transactions through a competitive best execution process and uses only those counterparties that meet its stringent and monitored criteria. The Trustees considered that PIMCO’s collateral management team utilizes a counterparty risk system to analyze portfolio level exposure and collateral being exchanged with counterparties.
In addition, the Trustees considered new services and service enhancements that PIMCO has implemented since the Board renewed the Agreements in 2014, including, but not limited to: conducting a targeted review of quality and efficiency in the valuation process; expanding the analytical review of shareholder reports by State Street Bank and Trust Company, the Funds’ custodian; developing a process for monthly forecasts of taxable and book income to enhance portfolio management of investment income; continuing the expansion of a proprietary performance reconciliation tool, which includes next-day comparison of daily internal performance to custodian bank performance to identify potential errors and guardrail net asset value calculations; developing and implementing the Global Process Monitor application, which includes real-time tracking and escalation protocols for critical activities; and implementing monthly cash flow reporting processes to support client and media demands for information about investor flows and assets under management data.
Ultimately, the Board concluded that the nature, extent and quality of services proposed to be provided by PIMCO under the Agreements are likely to benefit the Funds and their respective shareholders.
(b) Other Services: The Board also considered the nature, extent, quality and cost of supervisory and administrative services provided by PIMCO to the Funds under the Supervision and Administration Agreement. The Board considered the terms of the Supervision and Administration Agreement, under which the Trust pays for the supervisory and administrative services provided pursuant to that agreement under what is essentially an all-in fee structure (the “unified fee”). In return, PIMCO provides or procures certain supervisory and administrative services and bears the costs of various third party services required by the Funds, including audit, custodial, portfolio accounting, legal, transfer agency and printing costs. The Board noted that the scope and complexity of the supervisory and administrative services provided by PIMCO under the Supervision and Administration Agreement continue to increase. The Board considered PIMCO’s provision of these services and its supervision of the Trust’s third party service providers to assure that these service providers continue to provide a high level of service relative to alternatives available in the market.
Ultimately, the Board concluded that the nature, extent and quality of the services provided by PIMCO has benefited, and will likely continue to benefit, the Funds and their shareholders.
3. INVESTMENT PERFORMANCE
The Board received and examined information from PIMCO concerning the Funds’ performance, as available, over short- and long-term periods ended May 31, 2015 and other performance data, as available, over short- and long-term periods ended June 30, 2015 (the “PIMCO Report”) and from Lipper concerning the Funds’ performance, as available, over short- and long-term periods ended May 31, 2015 (the “Lipper Report”). The Board considered that limited performance information was available for the PIMCO RealPath Blend Funds because the Funds recently commenced operations. The Board also considered information regarding both the short- and long-term investment performance of each Fund relative to its peer group and relevant benchmark index as provided to the Board in advance of each of its quarterly meetings throughout the year, including the PIMCO Report and Lipper Report, which were provided in advance of the August 12, 2015 meeting.
The Board noted that, according to Lipper, certain Funds had underperformed in comparison to their respective peer groups or benchmark indexes, or both, over short- and long-term periods. The Board discussed with PIMCO the reasons for the underperformance of certain Funds over short- and long-term periods. The Board also discussed actions that have been taken by PIMCO to attempt to improve performance and took note of PIMCO’s plans to monitor performance going forward.
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(Unaudited)
The Board ultimately concluded, within the context of all of its considerations in connection with the Agreements, that PIMCO’s performance record and process in managing the Funds indicates that its continued management is likely to benefit the Funds and their shareholders, and merits the approval of the continuation of the Agreements.
4. ADVISORY FEES, SUPERVISORY AND ADMINISTRATIVE FEES AND TOTAL EXPENSES
The Board considered that PIMCO seeks to price funds to scale at the outset with reference to the total expense ratios of the respective Lipper median (if available), while providing a premium for innovative investment offerings. PIMCO reported to the Board that, in proposing fees for any Fund or class of shares, it considers a number of factors, including the type and complexity of the services provided, the cost of providing services, the risk assumed by PIMCO in the development of products and the provision of services, the impact on potential returns from different levels of fees, the competitive marketplace for financial products, and the attractiveness of potential Fund returns to current and potential investors. Fees charged to or proposed for different Funds for advisory services and supervisory and administrative services may vary in light of these various factors. The Board also considered that PIMCO reviews the Funds’ fee levels and carefully considers reductions where appropriate.
The Board reviewed the advisory fees, supervisory and administrative fees and total expenses of the Funds (each as a percentage of average net assets) and compared such amounts with the average and median fee and expense levels of other similar funds. With respect to advisory fees, the Board reviewed data from Lipper that compared the average and median advisory fees of other funds in a “Peer Group” of comparable funds, as well as the universe of other similar funds. The Board noted that PIMCO had contractually agreed, through October 31, 2015, to reduce its advisory fee by amounts shown in the table below:
PIMCO Balanced Income Fund | 0.15% | |||||
PIMCO Dividend and Income Builder Fund | 0.16% | |||||
PIMCO Global Dividend Fund | 0.16% | |||||
PIMCO International Dividend Fund | 0.16% | |||||
PIMCO U.S. Dividend Fund | 0.16% |
The Board further noted that the PIMCO Emerging Multi-Asset, PIMCO EqS® Emerging Markets and PIMCO EqS® Pathfinder Funds liquidated on July 14, 2015.
The Board also reviewed data comparing the Funds’ advisory fees to the standard fee rate PIMCO charges to separate accounts and to other investment companies with similar investment strategies, including differences in advisory services provided. The Board discussed separate
account and/or U.S. and non-U.S. registered fund comparisons to the PIMCO Global Dividend Fund, PIMCO Balanced Income Fund and PIMCO Dividend and Income Builder Fund (as available), noting that for the remaining Funds, there were no appropriate comparisons among separate accounts or non-U.S. registered funds at the time that the Board considered the Agreements. For PIMCO Global Dividend Fund, for which PIMCO offers a separate account with an investment strategy similar to the Fund, the Board noted that the separate account fee was lower than that charged to the Fund, but also noted that the differences in fees were attributable to various factors, including differences in the advisory and other services provided by PIMCO to the Fund, the manner in which similar portfolios may be managed, different requirements with respect to liquidity management and the implementation of other regulatory requirements, and the fact that separate accounts may have other contractual arrangements that justify different levels of fees. The Board noted that the advisory fees (or management fees, where applicable) for most Funds were similar to the fee rates charged to other investment companies with the same investment strategies as the Funds.
In considering the fees paid by the Funds, the Board noted that retail investors in the Funds receive the benefit of PIMCO’s advisory services at the same advisory fee rates as institutional investors in the Funds.
The Board considered the Funds’ supervisory and administrative fees, comparing them to similar funds in the report supplied by Lipper. The Board also considered that as the Funds’ business has become increasingly complex and the number of Funds has grown, PIMCO has provided an increasingly broad array of fund supervisory and administrative functions. In addition, the Board considered the Trust’s unified fee structure, under which the Trust pays for the supervisory and administrative services it requires for one set fee and, in return, PIMCO provides or procures supervisory and administrative services and bears the costs of various third party services required by the Funds, including audit, custodial, portfolio accounting, legal, transfer agency and printing costs. The Board further considered that many other funds pay for these services separately, and thus it is difficult to directly compare the Trust’s unified supervisory and administrative fees with the fees paid by other funds for administrative services alone. The Board also considered that the unified supervisory and administrative fee leads to Fund fees that are fixed, rather than variable. The Board noted that, although the unified fee structure does not have breakpoints, it implicitly reflects economies of scale by fixing the absolute level of Fund fees at competitive levels even if the Funds’ operating costs rise when assets remain flat or decrease. The Board concluded that the Funds’ supervisory and administrative fees were reasonable in relation to the value of the services provided, including the services provided to different classes of shareholders, and that the expenses assumed contractually by PIMCO under the
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Table of Contents
Approval of Investment Advisory Contract and Other Agreements (Cont.)
(Unaudited)
Supervision and Administration Agreement represent, in effect, a cap on overall Fund fees, which is beneficial to the Funds and their shareholders.
The Board noted that the Funds’ total expenses continued to be generally in-line with those of competitor funds. The Board discussed with PIMCO those Funds and/or classes of Funds that had above median total expenses. Upon comparing the Funds’ total expenses to other funds in the “Peer Groups” provided by Lipper, the Board found total expenses of each Fund to be reasonable.
Based on the information presented by PIMCO and Lipper, members of the Board determined, in the exercise of their business judgment, that the level of the advisory fees and supervisory and administrative fees charged by PIMCO under the Agreements, as well as the total expenses of each Fund, are reasonable.
5. ADVISER COSTS, LEVEL OF PROFITS AND ECONOMIES OF SCALE
The Board reviewed information regarding PIMCO’s costs of providing services to the Funds as a whole and considered that PIMCO continues to invest in the equity asset management platform and does not expect to derive any profit from the Funds during the Trust’s fiscal year ended December 31, 2015. The Board noted that it had received information regarding the structure and manner in which PIMCO’s investment professionals were compensated, and PIMCO’s view of the relationship of such compensation to the attraction and retention of quality personnel. The Board considered PIMCO’s need to invest in technology, cyber security, information security, shareholder privacy, business continuity planning, infrastructure and staff to reinforce and offer new services and to accommodate changing regulatory requirements.
With respect to potential economies of scale, the Board noted that PIMCO shares the benefits of economies of scale with the Funds and their shareholders in a number of ways, including through the pricing of Funds to scale from inception and the enhancement of services provided to the Funds in return for fees paid. In considering the advisory fees paid by the Funds, the Board also noted that retail investors in the Funds receive the benefit of PIMCO’s advisory services at the same advisory fee rates as institutional investors in the Funds. The Board considered that the Funds’ unified fee rates had been set competitively and/or priced to scale from inception and continued to be competitive compared with peers. The Board also considered that the unified fee is a transparent means of informing Fund shareholders of the fees associated with the Funds, and that the Funds bear certain expenses that are not covered by the advisory fee or the unified fee.
The Trustees considered that the unified fee has provided inherent economies of scale because a Fund maintains competitive fixed unified fees even if the particular Fund’s assets decline and/or operating costs rise. The Trustees further considered that, in contrast, breakpoints are a proxy for charging higher fees on lower asset levels and that when a fund’s assets decline, breakpoints may reverse, which causes expense ratios to increase. The Trustees also considered that, unlike the Funds’ unified fee structure, funds with “pass through” administrative fee structures may experience increased expense ratios when fixed dollar fees are charged against declining fund assets. The Trustees also considered that the unified fee protects shareholders from a rise in operating costs that may result from, among other things, PIMCO’s investments in various business enhancements and infrastructure, including those referenced above. The Trustees noted that PIMCO’s investments in these areas are extensive.
The Board concluded that the Funds’ cost structures were reasonable and that the unified fee structure inherently involves the sharing of economies of scale between PIMCO and each of the Funds, to the benefit of their respective shareholders.
6. ANCILLARY BENEFITS
The Board considered other benefits received by PIMCO and its affiliates as a result of PIMCO’s relationship with the Trust, including possible ancillary benefits to PIMCO’s institutional investment management business due to the reputation and market penetration of the Trust. The Board also considered that affiliates of PIMCO provide distribution and shareholder services to the Funds and their respective shareholders, for which they may be compensated through distribution and servicing fees paid pursuant to the Funds’ Rule 12b-1 plans or otherwise. The Board reviewed PIMCO’s soft dollar policies and procedures, noting that while PIMCO has the authority to receive the benefit of research provided by broker-dealers executing portfolio transactions on behalf of the Funds, it has adopted a policy not to enter into contractual soft dollar arrangements.
7. CONCLUSIONS
Based on their review, including their consideration of each of the factors summarized above, the Independent Trustees and the Board as a whole concluded that the nature, extent and quality of the services rendered to the Funds by PIMCO favored the renewal of the Agreements. The Independent Trustees and the Board as a whole concluded that the Agreements continued to be fair and reasonable to the Funds and their shareholders, that the Funds’ shareholders received reasonable value in return for the fees paid to PIMCO by the Funds under the Agreements, and that the renewal of the Agreements was in the best interests of the Funds and their shareholders.
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(Unaudited)
A special meeting of shareholders of the series of the Trust was held on February 5, 2016. The special meeting was held for the purpose of electing two (2) Trustees to the Trust’s Board of Trustees. Shareholders of all series of the Trust voted together on the proposal, and elected the following two (2) Trustees at the special meeting:
n | Jennifer Holden Dunbar |
n | Ronald C. Parker |
The results of the proxy solicitation on the preceding matter were as follows:
PIMCO Equity Series
Trustee Nominee | For* | Withheld* | ||||||||
Jennifer Holden Dunbar | 197,882,087 | 3,114,282 | ||||||||
Ronald C. Parker | 197,892,770 | 3,103,598 |
* | Certain series of the Trust’s shares were held by PIMCO-advised funds or accounts for which PIMCO had discretionary authority to vote proxies. Accordingly, PIMCO voted such shares in proportion to the votes of all other Trust shareholders voting on the proposal. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 83 |
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General Information
Investment Adviser and Administrator
Pacific Investment Management Company LLC
650 Newport Center Drive
Newport Beach, CA 92660
Investment Sub-Advisor
Research Affiliates, LLC
620 Newport Center Drive, Suite 900
Newport Beach, CA 92660
Distributor
PIMCO Investments LLC
1633 Broadway
New York, NY 10019
Custodian
State Street Bank and Trust Company
801 Pennsylvania Avenue
Kansas City, MO 64105
Transfer Agent
Boston Financial Data Services
Institutional Class, Class P, Administrative Class, Class D
330 W. 9th Street, 5th Floor
Kansas City, MO 64105
Boston Financial Data Services
Class A, Class C, Class R
P.O. Box 55060
Boston, MA 02205-5060
Legal Counsel
Dechert LLP
1900 K Street, N.W.
Washington, D.C. 20006
Independent Registered Public Accounting Firm
PricewaterhouseCoopers LLP
1100 Walnut Street, Suite 1300
Kansas City, MO 64106
This report is submitted for the general information of the shareholders of the PIMCO Equity Series.
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PES4003SAR_123115
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PIMCO Equity Series®
Semiannual Report
December 31, 2015
PIMCO RealPath™ Blend 2020 Fund
PIMCO RealPath™ Blend 2025 Fund
PIMCO RealPath™ Blend 2030 Fund
PIMCO RealPath™ Blend 2035 Fund
PIMCO RealPath™ Blend 2040 Fund
PIMCO RealPath™ Blend 2045 Fund
PIMCO RealPath™ Blend 2050 Fund
PIMCO RealPath™ Blend 2055 Fund
PIMCO RealPath™ Blend Income Fund
Share Classes
n | Institutional |
n | Administrative |
n | A |
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Approval of Investment Advisory Contract and Other Agreements | 84 | |||||||
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Fund | Fund Summary | Schedule of Investments | ||||||
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10 | 41 | |||||||
12 | 44 | |||||||
14 | 47 | |||||||
16 | 50 | |||||||
18 | 53 | |||||||
20 | 56 | |||||||
22 | 59 | |||||||
24 | 62 |
This material is authorized for use only when preceded or accompanied by the current PIMCO Equity Series prospectus. The Shareholder Reports for the other series of PIMCO Equity Series are printed separately.
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Dear Shareholder,
Please find enclosed the Semiannual Report for the PIMCO Equity Series covering the six-month reporting period ended December 31, 2015. The following pages contain specific details about the investment performance of each fund and a discussion of the factors that most affected performance during the reporting period.
Highlights of the financial markets during the six-month reporting period include:
n | Heightened market volatility throughout the reporting period was sparked by a mix of investor concerns including geopolitical developments, monetary policy and the potential for slowing global economic growth, which generally contributed to dampened investor sentiment. In particular, increasing concern over the outlook for Chinese growth sent commodity prices and inflation expectations lower, while also negatively impacting prices of emerging market (“EM”) debt and equities. In addition, the Chinese equity market began a strong decline in June 2015, which prompted the Chinese government to prop-up equity share prices and devalue the Chinese yuan. Volatility in Chinese equity markets continued into January 2016 on renewed concern over slowing Chinese economic growth. Furthermore, rising tension in the Middle East and the continued debt crisis in Greece also contributed to investor unease throughout the reporting period. |
n | Economic data in the U.S. continued to confirm a healthy economy, particularly labor market indicators such as employment and wages. Still, signs of caution remained, particularly as U.S. consumers appeared to be more selective in their spending and chose to save rather than spend their windfall from lower gas prices. Additionally, consumer sentiment and certain housing indicators softened towards the end of the reporting period, and December 2015 U.S. manufacturing data indicated the fastest contraction in six years. Within the Eurozone, volatility increased despite gradual improvement in the underlying economies. Eurozone economic data also showed generally positive signs of an early recovery but were tempered slightly by sluggish inflation. |
n | The theme of divergent global central bank monetary policy continued throughout the reporting period. The European Central Bank (“ECB”) expressed its commitment to increase quantitative easing (or large-scale asset purchases), along with the Bank of Japan and the People’s Bank of China who also indicated their intent to accelerate such measures. The Federal Reserve (“Fed”), on the other hand, moved on December 16 to raise the Federal Funds Rate by 0.25% to a new range of 0.25% – 0.50%, marking its first rate hike in nine years. However, the Fed noted that future increases in its target rate would be “gradual” and in-line with their previous projections, which helped to ease investor concerns. Outside of the reporting period on January 27, the Fed opted to leave the Federal Funds Rate unchanged, noting their intent to closely monitor how the global economy and markets influence the U.S. economic outlook. |
n | U.S. equities, as represented by the S&P 500 Index, returned 0.15% due to an improving economic outlook and stronger jobs growth. Internationally, equity markets experienced weak performance, as the MSCI EAFE Net Dividend Index (USD Hedged) declined 3.13% and the MSCI EAFE Net Dividend Index (USD Unhedged) declined 6.01% over the reporting period. During the first half of the reporting period, declining commodities prices and China’s economic deceleration drove concerns of slowing global growth, which weighed on equities. However, in the last half of the reporting period, developed market equities rebounded from lows reached in the first half as the theme of diverging monetary policy came into focus with the Federal Reserve raising interest rates for the first time in nearly a decade, while central banks around the world continued to implement accommodative monetary policies. |
n | Emerging market (“EM”) equities, as represented by the MSCI Emerging Markets Index (Net Dividends in USD), declined 17.36% over the reporting period. Concerns over China’s struggling economy continued as weak data and several attempts to support the Chinese equity market by the People’s Bank of China added to fears of slowing global growth. In addition, Brazil’s economic and political woes continued over the reporting period as the country’s credit rating was downgraded by S&P and Fitch to sub-investment grade, while President Dilma Rousseff faced increased scrutiny over her ability to revive the country’s economy. |
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n | Style-wise, growth equities outperformed value equities globally as the MSCI All Country World Growth Index (Net Dividends in USD) declined 3.13% and the MSCI All Country World Value Index (Net Dividends in USD) declined 6.68%. In general, the consumer staples and information technology sectors were the top performing equity sectors, while the energy and materials sectors were the worst performing equity sectors over the reporting period. |
n | U.S. Treasuries, as represented by the Barclays U.S. Treasury Index, returned 0.81% for the reporting period. Longer-maturity yields (i.e., ten to thirty year yields) declined, with prices therefore higher, while shorter-maturity yields (i.e., six month to seven year yields) rose. The benchmark ten-year U.S. Treasury note yielded 2.27% at the end of the reporting period, down from 2.35% on June 30, 2015. The Barclays U.S. Aggregate Index, a widely used index of U.S. investment-grade bonds, returned 0.65% for the reporting period. |
If you have any questions regarding the PIMCO Equity Series, please contact your account manager or financial adviser, or call one of our shareholder associates at 888.87.PIMCO (888.877.4626). We also invite you to visit our website at www.pimco.com to learn more about our views and global thought leadership.
Thank you again for the trust you have placed in us. We value your commitment and will continue to work diligently to meet your broad investment needs.
![]() | Sincerely,
Brent R. Harris Chairman of the Board, PIMCO Equity Series
February 22, 2016
|
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 3 |
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Important Information About the Funds
We believe that equity funds have an important role to play in a well diversified investment portfolio. It is important to note, however, that equity funds are subject to notable risks. Among other things, equity and equity-related securities may decline in value due to both real and perceived general market, economic, and industry conditions.
The Funds are each “fund of funds,” which is a term used to describe mutual funds that pursue their investment objective by investing in other mutual funds instead of investing directly in stocks or bonds of other issuers. Under normal circumstances, the Funds invest substantially all of their assets in Institutional Class or Class M shares of any funds of the PIMCO Equity Series (the “Trust”) and PIMCO Funds, and in other affiliated funds, including funds of PIMCO ETF Trust, except funds of funds (collectively, “Underlying PIMCO Funds”), and unaffiliated funds that are registered under the Investment Company Act of 1940 (collectively, “Acquired Funds”). The risks and strategies associated with an investment in the Fund may result from direct investments and/or indirect exposure through investment in Acquired Funds.
In an environment where interest rates may trend upward, rising rates would negatively impact the performance of certain funds, and fixed-income securities held by a Fund are likely to decrease in value. A number of factors can cause interest rates to rise (e.g., central bank monetary policies, inflation rates, general economic conditions, etc.). In addition, changes in interest rates can be sudden and significant, and there is no guarantee that Fund management will anticipate such movement accurately.
The values of equity securities, such as common stocks and preferred stocks, have historically risen and fallen in periodic cycles and may decline due to general market conditions, which are not specifically related to a particular company, such as real or perceived adverse economic conditions, changes in the general outlook for corporate earnings, changes in interest or currency rates or adverse investor sentiment generally. Equity securities may also decline due to factors that affect a particular industry or industries, such as labor shortages, increased production costs and competitive conditions within an industry. In addition, the value of an equity security may decline for a number of reasons that directly relate to the issuer, such as management performance, financial leverage and reduced demand for the issuer’s goods or services, as well as the historical and prospective earnings of the issuer and the value of its assets. Different types of equity securities may react differently to these developments and a change in the financial condition of a single issuer may affect securities markets as a whole.
During a general downturn in the securities markets, multiple asset classes, including equity securities, may decline in value simultaneously. The market price of equity securities owned by a Fund may go up or
down, sometimes rapidly or unpredictably. Equity securities generally have greater price volatility than fixed income securities and common stocks generally have the greatest appreciation and depreciation potential of all equity securities.
Interest rates in the U.S. are near historically low levels. As such, funds that invest in fixed income securities may currently face an increased exposure to the risks associated with a rising interest rate environment. This is especially true as the Fed ended its quantitative easing program and has begun, and may continue, to raise interest rates. Further, while the U.S. bond market has steadily grown over the past three decades, dealer inventories of corporate bonds have remained relatively stagnant. As a result, there has been a significant reduction in the ability of dealers to “make markets.”
Bond funds and individual bonds with a longer duration (a measure used to determine the sensitivity of a security’s price to changes in interest rates) tend to be more sensitive to changes in interest rates, usually making them more volatile than securities or funds with shorter durations. All of the factors mentioned above, individually or collectively, could lead to increased volatility and/or lower liquidity in the fixed income markets or negatively impact a Fund’s performance or cause the Fund to incur losses. As a result, a Fund may experience increased shareholder redemptions, which, among other things, could further reduce the net assets of the Fund.
The Funds may be subject to various risks as described in the Funds’ prospectus. Some of these risks may include, but are not limited to, the following: allocation risk, acquired fund risk, new / small fund risk, equity risk, value investing risk, interest rate risk, call risk, credit risk, high yield and distressed company risk, market risk, issuer risk, liquidity risk, derivatives risk, commodity risk, mortgage-related and other asset-backed securities, foreign (non-U.S.) investment risk, real estate risk, emerging market risk, sovereign debt risk, currency risk, leveraging risk, small-cap and mid-cap company risk, management risk, short sale risk, tax risk, subsidiary risk, arbitrage risk, and convertible securities risk. A complete description of these risks is contained in the Funds’ prospectus.
The Funds may use derivative instruments for hedging purposes or as part of an investment strategy. Use of these instruments may involve certain costs and risks such as liquidity risk, interest rate risk, market risk, credit risk, leverage risk, management risk and the risk that a Fund may not be able to close out a position when it would be most advantageous to do so. Certain derivative transactions may have a leveraging effect on a Fund. For example, a small investment in a derivative instrument may have a significant impact on a Fund’s exposure to interest rates, currency exchange rates or other investments. As a result, a relatively small price movement in an asset,
4 | PIMCO EQUITY SERIES |
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instrument or component of the index underlying a derivative instrument may cause an immediate and substantial loss or gain, which translates into heightened volatility of the Fund. A Fund may engage in such transactions regardless of whether the Fund owns the asset, instrument or components of the index underlying the derivative instrument. A Fund may invest a significant portion of its assets in these types of instruments. If it does, the Fund’s investment exposure could far exceed the value of its portfolio securities and its investment performance could be primarily dependent upon securities it does not own. Investing in foreign (non-U.S.) securities may entail risk due to foreign (non-U.S.) economic and political developments; this risk may be increased when investing in emerging markets.
For example, if a Fund invests in emerging market debt, it may face increased exposure to interest rate, liquidity, volatility, and redemption risk due to the specific economic, political, geographical, or legal background of the foreign (non-U.S.) issuer.
The value of an equity security of an issuer that has paid dividends in the past may decrease if the issuer reduces or eliminates future payments to its shareholders. If the dividends or distributions received by a Fund decrease, the Fund may have less income to distribute to the Fund’s shareholders. In addition, during certain market conditions, the equity securities of issuers that have paid regular dividends or distributions may not be widely available or may be highly concentrated in particular sectors of the market. A Fund may invest a significant portion of its assets in value stocks. Value stocks may perform differently from other types of stocks and the market as a whole. A value stock may decrease in price or may not increase in price as anticipated by PIMCO if it continues to be undervalued by the market or the factors that the portfolio manager believes will cause the stock price to increase do not occur.
The geographical classification of foreign (non-U.S.) securities in this report are classified by the country of incorporation of a holding. In certain instances, a security’s country of incorporation may be different from its country of economic exposure.
The PIMCO RealPathTM Blend Funds are intended for investors who prefer to have their asset allocation decisions made by professional money managers and are designed to offer individual investors comprehensive asset allocation strategies tailored to the time when they expect to retire or to begin withdrawing assets. Each PIMCO RealPathTM Blend Fund is designed for investors expecting to retire or to begin withdrawing portions of their investments around the year
indicated in the Fund’s name. The retirement year included in the RealPathTM Blend Fund’s name does not necessarily represent the specific year you expect to begin withdrawing your assets. It is intended only as a general guide.
The PIMCO RealPathTM Blend Funds are designed to provide investors with a comprehensive retirement solution tailored to the time when they expect to retire or plan to start withdrawing money (the “target date”). Each PIMCO RealPathTM Blend Fund follows a target asset allocation schedule that changes over time to help reduce portfolio risk, increasing its exposure to conservative investments as the target date approaches. The principal value of a Fund is not guaranteed at any time, including the target date. A Fund’s shareholders may experience losses, including losses near, at, or after the target year indicated in the PIMCO RealPathTM Blend Fund’s name.
On each individual Fund Summary page in this Shareholder Report, the Average Annual Total Return table and Cumulative Returns chart measure performance assuming that any dividend and capital gain distributions were reinvested. Class A shares are subject to an initial sales charge. A Contingent Deferred Sales Charge (“CDSC”) may be imposed in certain circumstances on Class A shares that are purchased without an initial sales charge and then redeemed during the first (i) 18 months after purchase for purchases made prior to August 10, 2015 and (ii) 12 months after purchase for purchases made on or after August 10, 2015. The Cumulative Returns chart reflects only Institutional Class performance. Performance for Class P, Administrative Class, Class D, Class A, Class C and Class R shares, if applicable, are typically lower than Institutional Class performance due to the lower expenses paid by Institutional Class shares. Performance shown is net of fees and expenses. A Fund’s total annual operating expense ratios on each individual Fund Summary page are as of the currently effective prospectus, as supplemented to date. The Cumulative Returns chart assumes the initial investment of $1,000,000 was made at the end of the month that the Institutional Class of the relevant Fund commenced operations. The minimum initial investment amount for Institutional Class, Class P and Administrative Class shares is $1,000,000. The minimum initial investment amount for Class A, Class C and Class D shares is $1,000. There is no minimum initial investment for Class R shares. Each Fund measures its performance against a broad-based securities market index (“benchmark index”). The benchmark index does not take into account fees, expenses, or taxes. A Fund’s past performance, before and after taxes, is not necessarily an indication of how the Fund will perform in the future.
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 5 |
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Important Information About the Funds (Cont.)
The following table discloses the inception dates of each Fund and its respective share classes along with each Fund’s diversification status as of period end:
Fund Name | Fund Inception | Institutional Class | Class P | Administrative Class | Class D | Class A | Class C | Class R | Diversification Status | |||||||||||||||||||||||||||||
PIMCO RealPathTM Blend 2020 Fund | 12/31/14 | 12/31/14 | — | 12/31/14 | — | 12/31/14 | — | — | Diversified | |||||||||||||||||||||||||||||
PIMCO RealPathTM Blend 2025 Fund | 12/31/14 | 12/31/14 | — | 12/31/14 | — | 12/31/14 | — | — | Diversified | |||||||||||||||||||||||||||||
PIMCO RealPathTM Blend 2030 Fund | 12/31/14 | 12/31/14 | — | 12/31/14 | — | 12/31/14 | — | — | Diversified | |||||||||||||||||||||||||||||
PIMCO RealPathTM Blend 2035 Fund | 12/31/14 | 12/31/14 | — | 12/31/14 | — | 12/31/14 | — | — | Diversified | |||||||||||||||||||||||||||||
PIMCO RealPathTM Blend 2040 Fund | 12/31/14 | 12/31/14 | — | 12/31/14 | — | 12/31/14 | — | — | Diversified | |||||||||||||||||||||||||||||
PIMCO RealPathTM Blend 2045 Fund | 12/31/14 | 12/31/14 | — | 12/31/14 | — | 12/31/14 | — | — | Diversified | |||||||||||||||||||||||||||||
PIMCO RealPathTM Blend 2050 Fund | 12/31/14 | 12/31/14 | — | 12/31/14 | — | 12/31/14 | — | — | Diversified | |||||||||||||||||||||||||||||
PIMCO RealPathTM Blend 2055 Fund | 12/31/14 | 12/31/14 | — | 12/31/14 | — | 12/31/14 | — | — | Diversified | |||||||||||||||||||||||||||||
PIMCO RealPathTM Blend Income Fund | 12/31/14 | 12/31/14 | — | 12/31/14 | — | 12/31/14 | — | — | Diversified |
An investment in a Fund is not a bank deposit and is not guaranteed or insured by the Federal Deposit Insurance Corporation (“FDIC”) or any other government agency. It is possible to lose money on investments in a Fund.
The Trustees are responsible generally for overseeing the management of the Trust. The Trustees authorize the Trust to enter into service agreements with the Adviser, the Distributor, the Administrator and other service providers in order to provide, and in some cases authorize service providers to procure through other parties, necessary or desirable services on behalf of the Trust and the Funds. Shareholders are not parties to or third-party beneficiaries of such service agreements. Neither a Fund’s prospectus nor a Fund’s summary prospectus, the Trust’s Statement of Additional Information (“SAI”), any contracts filed as exhibits to the Trust’s registration statement, nor any other communications, disclosure documents or regulatory filings (including this report) from or on behalf of the Trust or a Fund creates a contract between or among any shareholder of a Fund, on the one hand, and the Trust, a Fund, a service provider to the Trust or a Fund, and/or the Trustees or officers of the Trust, on the other hand. The Trustees (or the Trust and its officers, service providers or other delegates acting under authority of the Trustees) may amend the most recent prospectus or use a new prospectus, summary prospectus or SAI with respect to a Fund or the Trust, and/or amend, file and/or issue any other communications, disclosure documents or regulatory filings, and may amend or enter into any contracts to which the Trust or a Fund is a party, and interpret the investment objective(s), policies, restrictions and contractual provisions applicable
to any Fund, without shareholder input or approval, except in circumstances in which shareholder approval is specifically required by law (such as changes to fundamental investment policies) or where a shareholder approval requirement is specifically disclosed in the Trust’s then-current prospectus or SAI.
PIMCO has adopted written proxy voting policies and procedures (“Proxy Policy”) as required by Rule 206(4)-6 under the Investment Advisers Act of 1940, as amended. The Proxy Policy has been adopted by the Trust as the policies and procedures that PIMCO will use when voting on behalf of a Fund. A description of the policies and procedures that PIMCO uses to vote proxies relating to portfolio securities of a Fund, and information about how the Fund voted proxies relating to portfolio securities held during the most recent twelve-month period ended June 30th, are available without charge, upon request, by calling the Trust at (888) 87-PIMCO, on the Fund’s website at www.pimco.com, and on the Securities and Exchange Commission’s (“SEC”) website at www.sec.gov.
PIMCO Equity Series files a complete schedule of each Fund’s portfolio holdings with the SEC for the first and third quarters of each fiscal year on Form N-Q. A copy of a Fund’s Form N-Q is available on the SEC’s website at www.sec.gov and may be reviewed and copied at the SEC’s Public Reference Room in Washington, D.C. A Fund’s Form N-Q will also be available without charge, upon request, by calling the Trust at (888) 87-PIMCO and on the Fund’s website at www.pimco.com. Information on the operation of the Public Reference Room may be obtained by calling 1-800-SEC-0330.
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PIMCO RealPath™ Blend 2020 Fund
Cumulative Returns Through December 31, 2015
Investment Objective and Strategy Overview
» | The PIMCO RealPath™ Blend 2020 Fund seeks to maximize total return, consistent with prudent investment management, by investing under normal circumstances substantially all of its assets in Institutional Class or Class M shares of any funds of the Trust and PIMCO Funds, and in other affiliated funds, including funds of PIMCO ETF Trust, except funds of funds (“Underlying PIMCO Funds”), and unaffiliated funds that are registered under the Investment Company Act of 1940 (the “1940 Act”) (collectively, “Acquired Funds”). The Fund may also invest substantially all of its assets in equity securities, Fixed Income Instruments of varying maturities, or related derivatives on any securities mentioned above. Under normal circumstances, the Fund seeks to invest substantially all of its equity exposure in index tracking securities, including investments in affiliated or unaffiliated investment companies, which will be registered under the 1940 Act, or related derivatives on such securities or indexes. “Fixed Income Instruments” include bonds, debt securities and other similar instruments issued by various U.S. and non-U.S. public- or private-sector entities. The Fund will invest in such funds, securities, instruments and other investments to the extent permitted under the 1940 Act, or any exemptive relief therefrom. |
Cumulative Total Return for the period ended December 31, 2015 | ||||||||||||||
6 Months* | 1 Year | Fund Inception (12/31/14) | ||||||||||||
![]() | PIMCO RealPath™ Blend 2020 Fund Institutional Class | (3.45)% | (3.26)% | (3.26)% | ||||||||||
PIMCO RealPath™ Blend 2020 Fund Administrative Class | (3.63)% | (3.56)% | (3.56)% | |||||||||||
PIMCO RealPath™ Blend 2020 Fund Class A | (3.68)% | (3.71)% | (3.71)% | |||||||||||
PIMCO RealPath™ Blend 2020 Fund Class A (adjusted) | (8.97)% | (8.99)% | (8.99)% | |||||||||||
![]() | Real Return Target 2020 Index± | (3.08)% | (2.63)% | (2.63)% |
All Fund returns are net of fees and expenses.
* Cumulative return.
± Real Return Target 2020 Index is a composite of other indexes. The sub-indexes represent stocks, bonds, TIPs, commodities and real estate securities. The component asset classes are weighted within each index to reflect a targeted level of risk at the beginning and end of the investment horizon. Over time, the weights are adjusted based on predetermined formulas to systematically reduce the level of potential risk as the index’s maturity date approaches.
It is not possible to invest directly in an unmanaged index.
Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Current performance may be lower or higher than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The adjusted returns take into account the maximum sales charge of 5.50% on Class A shares. The Fund’s total annual operating expense ratio as stated in the Fund’s current prospectus, as supplemented to date, is 0.37% for the Institutional Class shares, 0.62% for the Administrative Class shares and 0.87% for the Class A shares. Details regarding any Fund’s operating expenses can be found in the Fund’s prospectus. For performance current to the most recent month-end, visit www.pimco.com.
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Institutional Class - PBZNX | Administrative Class - PBZDX | Class A - PBZAX |
Top 10 Holdings1
PIMCO Total Return Fund | 15.6% | |||||
Vanguard 500 Index Fund ‘Admiral’ | 15.3% | |||||
PIMCO Real Return Fund | 10.3% | |||||
PIMCO Real Return Asset Fund | 10.2% | |||||
PIMCO Foreign Bond Fund (U.S. Dollar-Hedged) | 7.7% | |||||
PIMCO Long Duration Total Return Fund | 7.7% | |||||
Vanguard Developed Markets Index Fund ‘Admiral’ | 7.6% | |||||
Vanguard Emerging Markets Stock Index Fund ‘Admiral’ | 7.6% | |||||
Vanguard REIT Index Fund ‘Admiral’ | 5.3% | |||||
PIMCO High Yield Fund | 5.1% |
Sector Breakdown1
Mutual Funds | 99.9% |
1 % of Investments, at value as of 12/31/2015. Top 10 Holdings and Sector Breakdown solely reflect long positions. Securities sold short, financial derivative instruments and short-term instruments are not taken into consideration.
Fund Insights
» | Exposure to real estate investment trusts (“REITs”) benefited absolute performance, as REITs posted positive returns over the reporting period. |
» | Within high yield exposure, expressed via PIMCO High Yield Fund, an underweight exposure to the energy sector benefited relative returns as this sector underperformed the broader U.S. High Yield Index over the reporting period. |
» | Exposure to emerging market equities detracted from absolute performance, as this asset class posted negative returns over the reporting period. |
» | Within long U.S. Treasury Inflation-Protected Securities (“TIPS”) exposure, expressed via PIMCO Real Return Asset Fund, an overweight exposure to U.S. breakeven inflation rates detracted from relative performance, as nominal Treasuries outperformed TIPS over the reporting period. |
» | Within long U.S. Treasury exposure, expressed via PIMCO Long Duration Total Return Fund, an exposure to U.S. corporate bonds detracted from relative performance, as U.S. corporate bonds underperformed long-term U.S. Treasuries over the reporting period. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 9 |
Table of Contents
PIMCO RealPath™ Blend 2025 Fund
Cumulative Returns Through December 31, 2015
Investment Objective and Strategy Overview
» | The PIMCO RealPath™ Blend 2025 Fund seeks to maximize total return, consistent with prudent investment management, by investing under normal circumstances substantially all of its assets in Institutional Class or Class M shares of any funds of the Trust and PIMCO Funds, and in other affiliated funds, including funds of PIMCO ETF Trust, except funds of funds (“Underlying PIMCO Funds”), and unaffiliated funds that are registered under the Investment Company Act of 1940 (the “1940 Act”) (collectively, “Acquired Funds”). The Fund may also invest substantially all of its assets in equity securities, Fixed Income Instruments of varying maturities, or related derivatives on any securities mentioned above. Under normal circumstances, the Fund seeks to invest substantially all of its equity exposure in index tracking securities, including investments in affiliated or unaffiliated investment companies, which will be registered under the 1940 Act, or related derivatives on such securities or indexes. “Fixed Income Instruments” include bonds, debt securities and other similar instruments issued by various U.S. and non-U.S. public- or private-sector entities. The Fund will invest in such funds, securities, instruments and other investments to the extent permitted under the 1940 Act, or any exemptive relief therefrom. |
Cumulative Total Return for the period ended December 31, 2015 | ||||||||||||||
6 Months* | 1 Year | Fund Inception (12/31/14) | ||||||||||||
![]() | PIMCO RealPath™ Blend 2025 Fund Institutional Class | (3.91)% | (3.54)% | (3.54)% | ||||||||||
PIMCO RealPath™ Blend 2025 Fund Administrative Class | (4.07)% | (3.79)% | (3.79)% | |||||||||||
PIMCO RealPath™ Blend 2025 Fund Class A | (4.17)% | (4.00)% | (4.00)% | |||||||||||
PIMCO RealPath™ Blend 2025 Fund Class A (adjusted) | (9.42)% | (9.26)% | (9.26)% | |||||||||||
![]() | Real Return Target 2025 Index± | (3.31)% | (2.79)% | (2.79)% |
All Fund returns are net of fees and expenses.
* Cumulative return.
± Real Return Target 2025 Index is a composite of other indexes. The sub-indexes represent stocks, bonds, TIPs, commodities and real estate securities. The component asset classes are weighted within each index to reflect a targeted level of risk at the beginning and end of the investment horizon. Over time, the weights are adjusted based on predetermined formulas to systematically reduce the level of potential risk as the index’s maturity date approaches.
It is not possible to invest directly in an unmanaged index.
Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Current performance may be lower or higher than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The adjusted returns take into account the maximum sales charge of 5.50% on Class A shares. The Fund’s total annual operating expense ratio as stated in the Fund’s current prospectus, as supplemented to date, is 0.33% for the Institutional Class shares, 0.58% for the Administrative Class shares and 0.83% for the Class A shares. Details regarding any Fund’s operating expenses can be found in the Fund’s prospectus. For performance current to the most recent month-end, visit www.pimco.com.
10 | PIMCO EQUITY SERIES |
Table of Contents
Institutional Class - PPZRX | Administrative Class - PPZDX | Class A - PPZAX |
Top 10 Holdings1
Vanguard 500 Index Fund ‘Admiral’ | 17.9% | |||||
PIMCO Real Return Asset Fund | 10.2% | |||||
Vanguard Developed Markets Index Fund ‘Admiral’ | 10.2% | |||||
Vanguard Emerging Markets Stock Index Fund ‘Admiral’ | 10.1% | |||||
Vanguard REIT Index Fund ‘Admiral’ | 7.9% | |||||
PIMCO Total Return Fund | 7.8% | |||||
PIMCO Long Duration Total Return Fund | 7.7% | |||||
PIMCO High Yield Fund | 7.7% | |||||
PIMCO Real Return Fund | 7.7% | |||||
PIMCO Foreign Bond Fund (U.S. Dollar-Hedged) | 5.2% |
Sector Breakdown1
Mutual Funds | 99.9% |
1 % of Investments, at value as of 12/31/2015. Top 10 Holdings and Sector Breakdown solely reflect long positions. Securities sold short, financial derivative instruments and short-term instruments are not taken into consideration.
Fund Insights
» | Exposure to real estate investment trusts (“REITs”) benefited absolute performance, as REITs posted positive returns over the reporting period. |
» | Within high yield exposure, expressed via PIMCO High Yield Fund, an underweight exposure to the energy sector benefited relative returns as this sector underperformed the broader U.S. High Yield Index over the reporting period. |
» | Exposure to emerging market equities detracted from absolute performance, as this asset class posted negative returns over the reporting period. |
» | Within long U.S. Treasury Inflation-Protected Securities (“TIPS”) exposure, expressed via PIMCO Real Return Asset Fund, an overweight exposure to U.S. breakeven inflation rates detracted from relative performance, as nominal Treasuries outperformed TIPS over the reporting period. |
» | Within long U.S. Treasury exposure, expressed via PIMCO Long Duration Total Return Fund, an exposure to U.S. corporate bonds detracted from relative performance, as U.S. corporate bonds underperformed long-term U.S. Treasuries over the reporting period. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 11 |
Table of Contents
PIMCO RealPath™ Blend 2030 Fund
Cumulative Returns Through December 31, 2015
Investment Objective and Strategy Overview
» | The PIMCO RealPath™ Blend 2030 Fund seeks to maximize total return, consistent with prudent investment management, by investing under normal circumstances substantially all of its assets in Institutional Class or Class M shares of any funds of the Trust and PIMCO Funds, and in other affiliated funds, including funds of PIMCO ETF Trust, except funds of funds (“Underlying PIMCO Funds”), and unaffiliated funds that are registered under the Investment Company Act of 1940 (the “1940 Act”) (collectively, “Acquired Funds”). The Fund may also invest substantially all of its assets in equity securities, Fixed Income Instruments of varying maturities, or related derivatives on any securities mentioned above. Under normal circumstances, the Fund seeks to invest substantially all of its equity exposure in index tracking securities, including investments in affiliated or unaffiliated investment companies, which will be registered under the 1940 Act, or related derivatives on such securities or indexes. “Fixed Income Instruments” include bonds, debt securities and other similar instruments issued by various U.S. and non-U.S. public- or private-sector entities. The Fund will invest in such funds, securities, instruments and other investments to the extent permitted under the 1940 Act, or any exemptive relief therefrom. |
Cumulative Total Return for the period ended December 31, 2015 | ||||||||||||||
6 Months* | 1 Year | Fund Inception (12/31/14) | ||||||||||||
![]() | PIMCO RealPath™ Blend 2030 Fund Institutional Class | (4.65)% | (4.19)% | (4.19)% | ||||||||||
PIMCO RealPath™ Blend 2030 Fund Administrative Class | (4.81)% | (4.46)% | (4.46)% | |||||||||||
PIMCO RealPath™ Blend 2030 Fund Class A | (4.93)% | (4.68)% | (4.68)% | |||||||||||
PIMCO RealPath™ Blend 2030 Fund Class A (adjusted) | (10.15)% | (9.91)% | (9.91)% | |||||||||||
![]() | Real Return Target 2030 Index± | (3.70)% | (3.08)% | (3.08)% |
All Fund returns are net of fees and expenses.
* Cumulative return.
± Real Return Target 2030 Index is a composite of other indexes. The sub-indexes represent stocks, bonds, TIPs, commodities and real estate securities. The component asset classes are weighted within each index to reflect a targeted level of risk at the beginning and end of the investment horizon. Over time, the weights are adjusted based on predetermined formulas to systematically reduce the level of potential risk as the index’s maturity date approaches.
It is not possible to invest directly in an unmanaged index.
Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Current performance may be lower or higher than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The adjusted returns take into account the maximum sales charge of 5.50% on Class A shares. The Fund’s total annual operating expense ratio as stated in the Fund’s current prospectus, as supplemented to date, is 0.32% for the Institutional Class shares, 0.57% for the Administrative Class shares and 0.82% for the Class A shares. Details regarding any Fund’s operating expenses can be found in the Fund’s prospectus. For performance current to the most recent month-end, visit www.pimco.com.
12 | PIMCO EQUITY SERIES |
Table of Contents
Institutional Class - PBPNX | Administrative Class - PBPRX | Class A - PBPAX |
Top 10 Holdings1
Vanguard 500 Index Fund ‘Admiral’ | 20.4% | |||||
Vanguard Developed Markets Index Fund ‘Admiral’ | 12.7% | |||||
Vanguard Emerging Markets Stock Index Fund ‘Admiral’ | 12.7% | |||||
Vanguard REIT Index Fund ‘Admiral’ | 10.6% | |||||
PIMCO Real Return Asset Fund | 10.2% | |||||
PIMCO High Yield Fund | 7.7% | |||||
PIMCO Long Duration Total Return Fund | 7.7% | |||||
PIMCO Emerging Local Bond Fund | 5.1% | |||||
Vanguard Small-Cap Index Fund ‘Admiral’ | 5.0% | |||||
PIMCO Total Return Fund | 2.6% |
Sector Breakdown1
Mutual Funds | 99.9% |
1 % of Investments, at value as of 12/31/2015. Top 10 Holdings and Sector Breakdown solely reflect long positions. Securities sold short, financial derivative instruments and short-term instruments are not taken into consideration.
Fund Insights
» | Exposure to real estate investment trusts (“REITs”) benefited absolute performance, as REITs posted positive returns over the reporting period. |
» | Within high yield exposure, expressed via PIMCO High Yield Fund, an underweight exposure to the energy sector benefited relative returns as this sector underperformed the broader U.S. High Yield Index over the reporting period. |
» | Exposure to emerging market equities detracted from absolute performance, as this asset class posted negative returns over the reporting period. |
» | Within long U.S. Treasury Inflation-Protected Securities (“TIPS”) exposure, expressed via PIMCO Real Return Asset Fund, an overweight exposure to U.S. breakeven inflation rates detracted from relative performance, as nominal Treasuries outperformed TIPS over the reporting period. |
» | Within long U.S. Treasury exposure, expressed via PIMCO Long Duration Total Return Fund, an exposure to U.S. corporate bonds detracted from relative performance, as U.S. corporate bonds underperformed long-term U.S. Treasuries over the reporting period. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 13 |
Table of Contents
PIMCO RealPath™ Blend 2035 Fund
Cumulative Returns Through December 31, 2015
Investment Objective and Strategy Overview
» | The PIMCO RealPath™ Blend 2035 Fund seeks to maximize total return, consistent with prudent investment management, by investing under normal circumstances substantially all of its assets in Institutional Class or Class M shares of any funds of the Trust and PIMCO Funds, and in other affiliated funds, including funds of PIMCO ETF Trust, except funds of funds (“Underlying PIMCO Funds”), and unaffiliated funds that are registered under the Investment Company Act of 1940 (the “1940 Act”) (collectively, “Acquired Funds”). The Fund may also invest substantially all of its assets in equity securities, Fixed Income Instruments of varying maturities, or related derivatives on any securities mentioned above. Under normal circumstances, the Fund seeks to invest substantially all of its equity exposure in index tracking securities, including investments in affiliated or unaffiliated investment companies, which will be registered under the 1940 Act, or related derivatives on such securities or indexes. “Fixed Income Instruments” include bonds, debt securities and other similar instruments issued by various U.S. and non-U.S. public- or private-sector entities. The Fund will invest in such funds, securities, instruments and other investments to the extent permitted under the 1940 Act, or any exemptive relief therefrom. |
Cumulative Total Return for the period ended December 31, 2015 | ||||||||||||||
6 Months* | 1 Year | Fund Inception (12/31/14) | ||||||||||||
PIMCO RealPath™ Blend 2035 Fund Institutional Class | (5.34)% | (4.50)% | (4.50)% | |||||||||||
PIMCO RealPath™ Blend 2035 Fund Administrative Class | (5.52)% | (4.79)% | (4.79)% | |||||||||||
PIMCO RealPath™ Blend 2035 Fund Class A | (5.55)% | (4.93)% | (4.93)% | |||||||||||
PIMCO RealPath™ Blend 2035 Fund Class A (adjusted) | (10.71)% | (10.14)% | (10.14)% | |||||||||||
Real Return Target 2035 Index± | (4.27)% | (3.50)% | (3.50)% |
All Fund returns are net of fees and expenses.
* Cumulative return.
± Real Return Target 2035 Index is a composite of other indexes. The sub-indexes represent stocks, bonds, TIPs, commodities and real estate securities. The component asset classes are weighted within each index to reflect a targeted level of risk at the beginning and end of the investment horizon. Over time, the weights are adjusted based on predetermined formulas to systematically reduce the level of potential risk as the index’s maturity date approaches.
It is not possible to invest directly in an unmanaged index.
Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Current performance may be lower or higher than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The adjusted returns take into account the maximum sales charge of 5.50% on Class A shares. The Fund’s total annual operating expense ratio as stated in the Fund’s current prospectus, as supplemented to date, is 0.28% for the Institutional Class shares, 0.53% for the Administrative Class shares and 0.78% for the Class A shares. Details regarding any Fund’s operating expenses can be found in the Fund’s prospectus. For performance current to the most recent month-end, visit www.pimco.com.
14 | PIMCO EQUITY SERIES |
Table of Contents
Institutional Class - PDGZX | Administrative Class - PDGDX | Class A - PDGAX |
Top Holdings1
Vanguard 500 Index Fund ‘Admiral’ | 23.1% | |||||
Vanguard Developed Markets Index Fund ‘Admiral’ | 15.3% | |||||
Vanguard Emerging Markets Stock Index Fund ‘Admiral’ | 15.3% | |||||
Vanguard REIT Index Fund ‘Admiral’ | 10.6% | |||||
PIMCO Real Return Asset Fund | 10.2% | |||||
PIMCO Long Duration Total Return Fund | 7.7% | |||||
Vanguard Small-Cap Index Fund ‘Admiral’ | 7.5% | |||||
PIMCO Emerging Local Bond Fund | 5.1% | |||||
PIMCO High Yield Fund | 5.1% |
Sector Breakdown1
Mutual Funds | 99.9% |
1 % of Investments, at value as of 12/31/2015. Top Holdings and Sector Breakdown solely reflect long positions. Securities sold short, financial derivative instruments and short-term instruments are not taken into consideration.
Fund Insights
» | Exposure to real estate investment trusts (“REITs”) benefited absolute performance, as REITs posted positive returns over the reporting period. |
» | Within high yield exposure, expressed via PIMCO High Yield Fund, an underweight exposure to the energy sector benefited relative returns as this sector underperformed the broader U.S. High Yield Index over the reporting period. |
» | Exposure to emerging market equities detracted from absolute performance, as this asset class posted negative returns over the reporting period. |
» | Within long U.S. Treasury Inflation-Protected Securities (“TIPS”) exposure, expressed via PIMCO Real Return Asset Fund, an overweight exposure to U.S. breakeven inflation rates detracted from relative performance, as nominal Treasuries outperformed TIPS over the reporting period. |
» | Within long U.S. Treasury exposure, expressed via PIMCO Long Duration Total Return Fund, an exposure to U.S. corporate bonds detracted from relative performance, as U.S. corporate bonds underperformed long-term U.S. Treasuries over the reporting period. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 15 |
Table of Contents
PIMCO RealPath™ Blend 2040 Fund
Cumulative Returns Through December 31, 2015
Investment Objective and Strategy Overview
» | The PIMCO RealPath™ Blend 2040 Fund seeks to maximize total return, consistent with prudent investment management, by investing under normal circumstances substantially all of its assets in Institutional Class or Class M shares of any funds of the Trust and PIMCO Funds, and in other affiliated funds, including funds of PIMCO ETF Trust, except funds of funds (“Underlying PIMCO Funds”), and unaffiliated funds that are registered under the Investment Company Act of 1940 (the “1940 Act”) (collectively, “Acquired Funds”). The Fund may also invest substantially all of its assets in equity securities, Fixed Income Instruments of varying maturities, or related derivatives on any securities mentioned above. Under normal circumstances, the Fund seeks to invest substantially all of its equity exposure in index tracking securities, including investments in affiliated or unaffiliated investment companies, which will be registered under the 1940 Act, or related derivatives on such securities or indexes. “Fixed Income Instruments” include bonds, debt securities and other similar instruments issued by various U.S. and non-U.S. public- or private-sector entities. The Fund will invest in such funds, securities, instruments and other investments to the extent permitted under the 1940 Act, or any exemptive relief therefrom. |
Cumulative Total Return for the period ended December 31, 2015 | ||||||||||||||
6 Months* | 1 Year | Fund Inception (12/31/14) | ||||||||||||
![]() | PIMCO RealPath™ Blend 2040 Fund Institutional Class | (5.16)% | (4.03)% | (4.03)% | ||||||||||
PIMCO RealPath™ Blend 2040 Fund Administrative Class | (5.28)% | (4.25)% | (4.25)% | |||||||||||
PIMCO RealPath™ Blend 2040 Fund Class A | (5.40)% | (4.47)% | (4.47)% | |||||||||||
PIMCO RealPath™ Blend 2040 Fund Class A (adjusted) | (10.64)% | (9.71)% | (9.71)% | |||||||||||
![]() | Real Return Target 2040 Index± | (4.87)% | (3.92)% | (3.92)% |
All Fund returns are net of fees and expenses.
* Cumulative return.
± Real Return Target 2040 Index is a composite of other indexes. The sub-indexes represent stocks, bonds, TIPs, commodities and real estate securities. The component asset classes are weighted within each index to reflect a targeted level of risk at the beginning and end of the investment horizon. Over time, the weights are adjusted based on predetermined formulas to systematically reduce the level of potential risk as the index’s maturity date approaches.
It is not possible to invest directly in an unmanaged index.
Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Current performance may be lower or higher than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The adjusted returns take into account the maximum sales charge of 5.50% on Class A shares. The Fund’s total annual operating expense ratio as stated in the Fund’s current prospectus, as supplemented to date, is 0.25% for the Institutional Class shares, 0.50% for the Administrative Class shares and 0.75% for the Class A shares. Details regarding any Fund’s operating expenses can be found in the Fund’s prospectus. For performance current to the most recent month-end, visit www.pimco.com.
16 | PIMCO EQUITY SERIES |
Table of Contents
Institutional Class - PVPNX | Administrative Class - PVPRX | Class A - PVPAX |
Top Holdings1
Vanguard 500 Index Fund ‘Admiral’ | 25.6% | |||||
Vanguard Developed Markets Index Fund ‘Admiral’ | 15.3% | |||||
Vanguard Emerging Markets Stock Index Fund ‘Admiral’ | 15.2% | |||||
Vanguard REIT Index Fund ‘Admiral’ | 10.6% | |||||
Vanguard Small-Cap Index Fund ‘Admiral’ | 10.0% | |||||
PIMCO Long Duration Total Return Fund | 7.8% | |||||
PIMCO Real Return Asset Fund | 7.7% | |||||
PIMCO High Yield Fund | 5.2% | |||||
PIMCO Emerging Local Bond Fund | 2.5% |
Sector Breakdown1
Mutual Funds | 99.9% |
1 % of Investments, at value as of 12/31/2015. Top Holdings and Sector Breakdown solely reflect long positions. Securities sold short, financial derivative instruments and short-term instruments are not taken into consideration.
Fund Insights
» | Exposure to real estate investment trusts (“REITs”) benefited absolute performance, as REITs posted positive returns over the reporting period. |
» | Within high yield exposure, expressed via PIMCO High Yield Fund, an underweight exposure to the energy sector benefited relative returns as this sector underperformed the broader U.S. High Yield Index over the reporting period. |
» | Exposure to emerging market equities detracted from absolute performance, as this asset class posted negative returns over the reporting period. |
» | Within long U.S. Treasury Inflation-Protected Securities (“TIPS”) exposure, expressed via PIMCO Real Return Asset Fund, an overweight exposure to U.S. breakeven inflation rates detracted from relative performance, as nominal Treasuries outperformed TIPS over the reporting period. |
» | Within long U.S. Treasury exposure, expressed via PIMCO Long Duration Total Return Fund, an exposure to U.S. corporate bonds detracted from relative performance, as U.S. corporate bonds underperformed long-term U.S. Treasuries over the reporting period. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 17 |
Table of Contents
PIMCO RealPath™ Blend 2045 Fund
Cumulative Returns Through December 31, 2015
Investment Objective and Strategy Overview
» | The PIMCO RealPath™ Blend 2045 Fund seeks to maximize total return, consistent with prudent investment management, by investing under normal circumstances substantially all of its assets in Institutional Class or Class M shares of any funds of the Trust and PIMCO Funds, and in other affiliated funds, including funds of PIMCO ETF Trust, except funds of funds (“Underlying PIMCO Funds”), and unaffiliated funds that are registered under the Investment Company Act of 1940 (the “1940 Act”) (collectively, “Acquired Funds”). The Fund may also invest substantially all of its assets in equity securities, Fixed Income Instruments of varying maturities, or related derivatives on any securities mentioned above. Under normal circumstances, the Fund seeks to invest substantially all of its equity exposure in index tracking securities, including investments in affiliated or unaffiliated investment companies, which will be registered under the 1940 Act, or related derivatives on such securities or indexes. “Fixed Income Instruments” include bonds, debt securities and other similar instruments issued by various U.S. and non-U.S. public- or private-sector entities. The Fund will invest in such funds, securities, instruments and other investments to the extent permitted under the 1940 Act, or any exemptive relief therefrom. |
Cumulative Total Return for the period ended December 31, 2015 | ||||||||||||||
6 Months* | 1 Year | Fund Inception (12/31/14) | ||||||||||||
![]() | PIMCO RealPath™ Blend 2045 Fund Institutional Class | (5.70)% | (4.30)% | (4.30)% | ||||||||||
PIMCO RealPath™ Blend 2045 Fund Administrative Class | (5.76)% | (4.51)% | (4.51)% | |||||||||||
PIMCO RealPath™ Blend 2045 Fund Class A | (5.83)% | (4.73)% | (4.73)% | |||||||||||
PIMCO RealPath™ Blend 2045 Fund Class A (adjusted) | (11.03)% | (9.95)% | (9.95)% | |||||||||||
![]() | Real Return Target 2045 Index± | (5.31)% | (4.19)% | (4.19)% |
All Fund returns are net of fees and expenses.
* Cumulative return.
± Real Return Target 2045 Index is a composite of other indexes. The sub-indexes represent stocks, bonds, TIPs, commodities and real estate securities. The component asset classes are weighted within each index to reflect a targeted level of risk at the beginning and end of the investment horizon. Over time, the weights are adjusted based on predetermined formulas to systematically reduce the level of potential risk as the index’s maturity date approaches.
It is not possible to invest directly in an unmanaged index.
Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Current performance may be lower or higher than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The adjusted returns take into account the maximum sales charge of 5.50% on Class A shares. The Fund’s total annual operating expense ratio as stated in the Fund’s current prospectus, as supplemented to date, is 0.23% for the Institutional Class shares, 0.48% for the Administrative Class shares and 0.73% for the Class A shares. Details regarding any Fund’s operating expenses can be found in the Fund’s prospectus. For performance current to the most recent month-end, visit www.pimco.com.
18 | PIMCO EQUITY SERIES |
Table of Contents
Institutional Class - PVQNX | Administrative Class - PVQDX | Class A - PVQAX |
Top Holdings1
Vanguard 500 Index Fund ‘Admiral’ | 25.6% | |||||
Vanguard Developed Markets Index Fund ‘Admiral’ | 17.9% | |||||
Vanguard Emerging Markets Stock Index Fund ‘Admiral’ | 17.8% | |||||
Vanguard REIT Index Fund ‘Admiral’ | 10.6% | |||||
Vanguard Small-Cap Index Fund ‘Admiral’ | 10.0% | |||||
PIMCO Long Duration Total Return Fund | 7.8% | |||||
PIMCO Real Return Asset Fund | 5.1% | |||||
PIMCO High Yield Fund | 2.6% | |||||
PIMCO Emerging Local Bond Fund | 2.5% |
Sector Breakdown1
Mutual Funds | 99.9% |
1 % of Investments, at value as of 12/31/2015. Top Holdings and Sector Breakdown solely reflect long positions. Securities sold short, financial derivative instruments and short-term instruments are not taken into consideration.
Fund Insights
» | Exposure to real estate investment trusts (“REITs”) benefited absolute performance, as REITs posted positive returns over the reporting period. |
» | Within high yield exposure, expressed via PIMCO High Yield Fund, an underweight exposure to the energy sector benefited relative returns as this sector underperformed the broader U.S. High Yield Index over the reporting period. |
» | Exposure to emerging market equities detracted from absolute performance, as this asset class posted negative returns over the reporting period. |
» | Within long U.S. Treasury Inflation-Protected Securities (“TIPS”) exposure, expressed via PIMCO Real Return Asset Fund, an overweight exposure to U.S. breakeven inflation rates detracted from relative performance, as nominal Treasuries outperformed TIPS over the reporting period. |
» | Within long U.S. Treasury exposure, expressed via PIMCO Long Duration Total Return Fund, an exposure to U.S. corporate bonds detracted from relative performance, as U.S. corporate bonds underperformed long-term U.S. Treasuries over the reporting period. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 19 |
Table of Contents
PIMCO RealPath™ Blend 2050 Fund
Cumulative Returns Through December 31, 2015
Investment Objective and Strategy Overview
» | The PIMCO RealPath™ Blend 2050 Fund seeks to maximize total return, consistent with prudent investment management, by investing under normal circumstances substantially all of its assets in Institutional Class or Class M shares of any funds of the Trust and PIMCO Funds, and in other affiliated funds, including funds of PIMCO ETF Trust, except funds of funds (“Underlying PIMCO Funds”), and unaffiliated funds that are registered under the Investment Company Act of 1940 (the “1940 Act”) (collectively, “Acquired Funds”). The Fund may also invest substantially all of its assets in equity securities, Fixed Income Instruments of varying maturities, or related derivatives on any securities mentioned above. Under normal circumstances, the Fund seeks to invest substantially all of its equity exposure in index tracking securities, including investments in affiliated or unaffiliated investment companies, which will be registered under the 1940 Act, or related derivatives on such securities or indexes. “Fixed Income Instruments” include bonds, debt securities and other similar instruments issued by various U.S. and non-U.S. public- or private-sector entities. The Fund will invest in such funds, securities, instruments and other investments to the extent permitted under the 1940 Act, or any exemptive relief therefrom. |
Cumulative Total Return for the period ended December 31, 2015 | ||||||||||||||
6 Months* | 1 Year | Fund Inception (12/31/14) | ||||||||||||
![]() | PIMCO RealPath™ Blend 2050 Fund Institutional Class | (5.48)% | (3.98)% | (3.98)% | ||||||||||
PIMCO RealPath™ Blend 2050 Fund Administrative Class | (5.56)% | (4.24)% | (4.24)% | |||||||||||
PIMCO RealPath™ Blend 2050 Fund Class A | (5.76)% | (4.53)% | (4.53)% | |||||||||||
PIMCO RealPath™ Blend 2050 Fund Class A (adjusted) | (10.96)% | (9.76)% | (9.76)% | |||||||||||
![]() | Real Return Target 2050 Index± | (5.57)% | (4.27)% | (4.27)% |
All Fund returns are net of fees and expenses.
* Cumulative return.
± Real Return Target 2050 Index is a composite of other indexes. The sub-indexes represent stocks, bonds, TIPs, commodities and real estate securities. The component asset classes are weighted within each index to reflect a targeted level of risk at the beginning and end of the investment horizon. Over time, the weights are adjusted based on predetermined formulas to systematically reduce the level of potential risk as the index’s maturity date approaches.
It is not possible to invest directly in an unmanaged index.
Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Current performance may be lower or higher than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The adjusted returns take into account the maximum sales charge of 5.50% on Class A shares. The Fund’s total annual operating expense ratio as stated in the Fund’s current prospectus, as supplemented to date, is 0.21% for the Institutional Class shares, 0.46% for the Administrative Class shares and 0.71% for the Class A shares. Details regarding any Fund’s operating expenses can be found in the Fund’s prospectus. For performance current to the most recent month-end, visit www.pimco.com.
20 | PIMCO EQUITY SERIES |
Table of Contents
Institutional Class - PPQZX | Administrative Class - PPQDX | Class A - PPQAX |
Top Holdings1
Vanguard 500 Index Fund ‘Admiral’ | 28.2% | |||||
Vanguard Developed Markets Index Fund ‘Admiral’ | 17.9% | |||||
Vanguard Emerging Markets Stock Index Fund ‘Admiral’ | 17.8% | |||||
Vanguard REIT Index Fund ‘Admiral’ | 10.6% | |||||
Vanguard Small-Cap Index Fund ‘Admiral’ | 10.0% | |||||
PIMCO Long Duration Total Return Fund | 7.8% | |||||
PIMCO Real Return Asset Fund | 2.6% | |||||
PIMCO High Yield Fund | 2.5% | |||||
PIMCO Emerging Local Bond Fund | 2.5% |
Sector Breakdown1
Mutual Funds | 99.9% |
1 % of Investments, at value as of 12/31/2015. Top Holdings and Sector Breakdown solely reflect long positions. Securities sold short, financial derivative instruments and short-term instruments are not taken into consideration.
Fund Insights
» | Exposure to real estate investment trusts (“REITs”) benefited absolute performance, as REITs posted positive returns over the reporting period. |
» | Within high yield exposure, expressed via PIMCO High Yield Fund, an underweight exposure to the energy sector benefited relative returns as this sector underperformed the broader U.S. High Yield Index over the reporting period. |
» | Exposure to emerging market equities detracted from absolute performance, as this asset class posted negative returns over the reporting period. |
» | Within long U.S. Treasury Inflation-Protected Securities (“TIPS”) exposure, expressed via PIMCO Real Return Asset Fund, an overweight exposure to U.S. breakeven inflation rates detracted from relative performance, as nominal Treasuries outperformed TIPS over the reporting period. |
» | Within long U.S. Treasury exposure, expressed via PIMCO Long Duration Total Return Fund, an exposure to U.S. corporate bonds detracted from relative performance, as U.S. corporate bonds underperformed long-term U.S. Treasuries over the reporting period. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 21 |
Table of Contents
PIMCO RealPath™ Blend 2055 Fund
Cumulative Returns Through December 31, 2015
Investment Objective and Strategy Overview
» | The PIMCO RealPath™ Blend 2055 Fund seeks to maximize total return, consistent with prudent investment management, by investing under normal circumstances substantially all of its assets in Institutional Class shares of any funds of the Trust and PIMCO Funds, and in other affiliated funds, including funds of PIMCO ETF Trust, except funds of funds (“Underlying PIMCO Funds”), and unaffiliated funds that are registered under the Investment Company Act of 1940 (the “1940 Act”) (collectively, “Acquired Funds”). The Fund may also invest substantially all of its assets in equity securities, Fixed Income Instruments of varying maturities, or related derivatives on any securities mentioned above. Under normal circumstances, the Fund seeks to invest substantially all of its equity exposure in index tracking securities, including investments in affiliated or unaffiliated investment companies, which will be registered under the 1940 Act, or related derivatives on such securities or indexes. “Fixed Income Instruments” include bonds, debt securities and other similar instruments issued by various U.S. and non-U.S. public- or private-sector entities. The Fund will invest in such funds, securities, instruments and other investments to the extent permitted under the 1940 Act, or any exemptive relief therefrom. |
Cumulative Total Return for the period ended December 31, 2015 | ||||||||||||||
6 Months* | 1 Year | Fund Inception (12/31/14) | ||||||||||||
![]() | PIMCO RealPath™ Blend 2055 Fund Institutional Class | (5.53)% | (4.04)% | (4.04)% | ||||||||||
PIMCO RealPath™ Blend 2055 Fund Administrative Class | (5.70)% | (4.32)% | (4.32)% | |||||||||||
PIMCO RealPath™ Blend 2055 Fund Class A | (5.87)% | (4.66)% | (4.66)% | |||||||||||
PIMCO RealPath™ Blend 2055 Fund Class A (adjusted) | (11.07)% | (9.89)% | (9.89)% | |||||||||||
![]() | Real Return Target 40+ Index± | (5.72)% | (4.32)% | (4.32)% |
All Fund returns are net of fees and expenses.
* Cumulative return.
± Real Return Target 40+ Index is a composite of other indexes. The sub-indexes represent stocks, bonds, TIPs, commodities and real estate securities. The component asset classes are weighted within each index to reflect a targeted level of risk at the beginning and end of the investment horizon. Over time, the weights are adjusted based on predetermined formulas to systematically reduce the level of potential risk as the index’s maturity date approaches.
It is not possible to invest directly in an unmanaged index.
Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Current performance may be lower or higher than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The adjusted returns take into account the maximum sales charge of 5.50% on Class A shares. The Fund’s total annual operating expense ratio as stated in the Fund’s current prospectus, as supplemented to date, is 0.21% for the Institutional Class shares, 0.46% for the Administrative Class shares and 0.71% for the Class A shares. Details regarding any Fund’s operating expenses can be found in the Fund’s prospectus. For performance current to the most recent month-end, visit www.pimco.com.
22 | PIMCO EQUITY SERIES |
Table of Contents
Institutional Class - PRQZX | Administrative Class - PRQDX | Class A - PRQAX |
Top Holdings1
Vanguard 500 Index Fund ‘Admiral’ | 28.2% | |||||
Vanguard Developed Markets Index Fund ‘Admiral’ | 17.9% | |||||
Vanguard Emerging Markets Stock Index Fund ‘Admiral’ | 17.8% | |||||
Vanguard REIT Index Fund ‘Admiral’ | 10.6% | |||||
Vanguard Small-Cap Index Fund ‘Admiral’ | 10.0% | |||||
PIMCO Long Duration Total Return Fund | 7.7% | |||||
PIMCO High Yield Fund | 2.6% | |||||
PIMCO Real Return Asset Fund | 2.6% | |||||
PIMCO Emerging Local Bond Fund | 2.5% |
Sector Breakdown1
Mutual Funds | 99.9% |
1 % of Investments, at value as of 12/31/2015. Top Holdings and Sector Breakdown solely reflect long positions. Securities sold short, financial derivative instruments and short-term instruments are not taken into consideration.
Fund Insights
» | Exposure to real estate investment trusts (“REITs”) benefited absolute performance, as REITs posted positive returns over the reporting period. |
» | Within high yield exposure, expressed via PIMCO High Yield Fund, an underweight exposure to the energy sector benefited relative returns as this sector underperformed the broader U.S. High Yield Index over the reporting period. |
» | Exposure to emerging market equities detracted from absolute performance, as this asset class posted negative returns over the reporting period. |
» | Within long U.S. Treasury Inflation-Protected Securities (“TIPS”) exposure, expressed via PIMCO Real Return Asset Fund, an overweight exposure to U.S. breakeven inflation rates detracted from relative performance, as nominal Treasuries outperformed TIPS over the reporting period. |
» | Within long U.S. Treasury exposure, expressed via PIMCO Long Duration Total Return Fund, an exposure to U.S. corporate bonds detracted from relative performance, as U.S. corporate bonds underperformed long-term U.S. Treasuries over the reporting period. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 23 |
Table of Contents
PIMCO RealPath™ Blend Income Fund
Cumulative Returns Through December 31, 2015
Investment Objective and Strategy Overview
» | The PIMCO RealPath™ Blend Income Fund seeks to maximize total return, consistent with prudent investment management, by investing under normal circumstances substantially all of its assets in Institutional Class or Class M shares of any funds of the Trust and PIMCO Funds, and in other affiliated funds, including funds of PIMCO ETF Trust, except funds of funds (“Underlying PIMCO Funds”), and unaffiliated funds that are registered under the Investment Company Act of 1940 (the “1940 Act”) (collectively, “Acquired Funds”). The Fund may also invest substantially all of its assets in equity securities, Fixed Income Instruments of varying maturities, or related derivatives on any securities mentioned above. Under normal circumstances, the Fund seeks to invest substantially all of its equity exposure in index tracking securities, including investments in affiliated or unaffiliated investment companies, which will be registered under the 1940 Act, or related derivatives on such securities or indexes. “Fixed Income Instruments” include bonds, debt securities and other similar instruments issued by various U.S. and non-U.S. public- or private-sector entities. The Fund will invest in such funds, securities, instruments and other investments to the extent permitted under the 1940 Act, or any exemptive relief therefrom. |
Cumulative Total Return for the period ended December 31, 2015 | ||||||||||||||
6 Months* | 1 Year | Fund Inception (12/31/14) | ||||||||||||
![]() | PIMCO RealPath™ Blend Income Fund Institutional Class | (2.66)% | (2.68)% | (2.68)% | ||||||||||
PIMCO RealPath™ Blend Income Fund Administrative Class | (2.78)% | (2.99)% | (2.99)% | |||||||||||
PIMCO RealPath™ Blend Income Fund Class A | (2.90)% | (3.12)% | (3.12)% | |||||||||||
PIMCO RealPath™ Blend Income Fund Class A (adjusted) | (8.26)% | (8.43)% | (8.43)% | |||||||||||
![]() | Real Return Target Today Index± | (3.01)% | (2.60)% | (2.60)% |
All Fund returns are net of fees and expenses.
* Cumulative return.
± Real Return Target Today Index is a composite of other indexes. The sub-indexes represent stocks, bonds, TIPs, commodities and real estate securities. The component asset classes are weighted within each index to reflect a targeted level of risk at the beginning and end of the investment horizon. Over time, the weights are adjusted based on predetermined formulas to systematically reduce the level of potential risk as the index’s maturity date approaches.
It is not possible to invest directly in an unmanaged index.
Performance quoted represents past performance. Past performance is not a guarantee or a reliable indicator of future results. Current performance may be lower or higher than performance shown. Investment return and the principal value of an investment will fluctuate. Shares may be worth more or less than original cost when redeemed. Returns shown do not reflect the deduction of taxes that a shareholder would pay on fund distributions or the redemption of fund shares. The adjusted returns take into account the maximum sales charge of 5.50% on Class A shares. The Fund’s total annual operating expense ratio as stated in the Fund’s current prospectus, as supplemented to date, is 0.37% for the Institutional Class shares, 0.62% for the Administrative Class shares and 0.87% for the Class shares. Details regarding any Fund’s operating expenses can be found in the Fund’s prospectus. For performance current to the most recent month-end, visit www.pimco.com.
24 | PIMCO EQUITY SERIES |
Table of Contents
Institutional Class - PBRNX | Administrative Class - PBRDX | Class A - PBRAX |
Top 10 Holdings1
PIMCO Total Return Fund | 15.5% | |||||
PIMCO Real Return Fund | 15.4% | |||||
Vanguard 500 Index Fund ‘Admiral’ | 12.7% | |||||
PIMCO Foreign Bond Fund (U.S. Dollar-Hedged) | 10.3% | |||||
PIMCO Long Duration Total Return Fund | 7.7% | |||||
PIMCO Real Return Asset Fund | 7.6% | |||||
Vanguard Developed Markets Index Fund ‘Admiral’ | 7.6% | |||||
Vanguard REIT Index Fund ‘Admiral’ | 5.3% | |||||
Vanguard Emerging Markets Stock Index Fund ‘Admiral’ | 5.0% | |||||
PIMCO High Yield Fund | 2.6% |
Sector Breakdown1
Mutual Funds | 94.7% |
1 % of Investments, at value as of 12/31/2015. Top 10 Holdings and Sector Breakdown solely reflect long positions. Securities sold short, financial derivative instruments and short-term instruments are not taken into consideration.
Fund Insights
» | Exposure to real estate investment trusts (“REITs”) benefited absolute performance, as REITs posted positive returns over the reporting period. |
» | Within high yield exposure, expressed via PIMCO High Yield Fund, an underweight exposure to the energy sector benefited relative returns as this sector underperformed the broader U.S. High Yield Index over the reporting period. |
» | Exposure to emerging market equities detracted from absolute performance, as this asset class posted negative returns over the reporting period. |
» | Within long U.S. Treasury Inflation-Protected Securities (“TIPS”) exposure, expressed via PIMCO Real Return Asset Fund, an overweight exposure to U.S. breakeven inflation rates detracted from relative performance, as nominal Treasuries outperformed TIPS over the reporting period. |
» | Within long U.S. Treasury exposure, expressed via PIMCO Long Duration Total Return Fund, an exposure to U.S. corporate bonds detracted from relative performance, as U.S. corporate bonds underperformed long-term U.S. Treasuries over the reporting period. |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 25 |
Table of Contents
Example
As a shareholder of a Fund, you incur two types of costs: (1) transaction costs, including sales charges (loads) on purchase payments and exchange fees and (2) ongoing costs, including management fees, distribution and/or service (12b-1) fees, and other Fund expenses. The Example is intended to help you understand your ongoing costs (in dollars) of investing in a Fund and to compare these costs with the ongoing costs of investing in other mutual funds.
The Example is based on an investment of $1,000 invested at the beginning of the period and held for the entire period indicated, which for all Funds and share classes is from July 1, 2015 to December 31, 2015 unless noted otherwise in the table and footnotes below.
Actual Expenses
The information in the table under the heading “Actual” provides information about actual account values and actual expenses. You may use the information in these columns, together with the amount you invested, to estimate the expenses that you paid over the period. Simply divide your account value by $1,000 (for example, an $8,600 account value divided by $1,000 = $8.60), then multiply the result by the number in the appropriate column for your share class, in the column entitled “Expenses Paid During Period” to estimate the expenses you paid on your account during this period.
Hypothetical Example for Comparison Purposes
The information in the table under the heading “Hypothetical (5% return before expenses)” provides information about hypothetical account values and hypothetical expenses based on a Fund’s actual expense ratio and an assumed rate of return of 5% per year before expenses, which is not the Fund’s actual return. The hypothetical account values and expenses may not be used to estimate the actual ending account balance or expenses you paid for the period. You may use this information to compare the ongoing costs of investing in a Fund and other funds. To do so, compare this 5% hypothetical example with the 5% hypothetical examples that appear in the shareholder reports of the other funds.
Please note that the expenses shown in the table are meant to highlight your ongoing costs only and do not reflect any transactional costs, such as sales charges (loads) on purchase payments and exchange fees. Therefore, the information under the heading “Hypothetical (5% return before expenses)” is useful in comparing ongoing costs only, and will not help you determine the relative total costs of owning different funds. In addition, if these transactional costs were included, your costs would have been higher.
Expense ratios may vary from period to period because of various factors such as an increase in expenses that are not covered by the management fees, such as fees and expenses of the independent trustees and their counsel, extraordinary expenses and interest expense.
Actual | Hypothetical (5% return before expenses) | |||||||||||||||||||||||||||||||||
Beginning Account Value (07/01/15) | Ending Account Value (12/31/15) | Expenses Paid During Period* | Beginning Account Value (07/01/15) | Ending Account Value (12/31/15) | Expenses Paid During Period* | Net Annualized | ||||||||||||||||||||||||||||
PIMCO RealPath™ Blend 2020 Fund | ||||||||||||||||||||||||||||||||||
Institutional Class | $ | 1,000.00 | $ | 965.50 | $ | 0.15 | $ | 1,000.00 | $ | 1,025.39 | $ | 0.16 | 0.03 | % | ||||||||||||||||||||
Administrative Class | 1,000.00 | 963.70 | 1.40 | 1,000.00 | 1,024.12 | 1.45 | 0.28 | |||||||||||||||||||||||||||
Class A | 1,000.00 | 963.20 | 2.66 | 1,000.00 | 1,022.84 | 2.74 | 0.53 | |||||||||||||||||||||||||||
PIMCO RealPath™ Blend 2025 Fund | ||||||||||||||||||||||||||||||||||
Institutional Class | $ | 1,000.00 | $ | 960.90 | $ | 0.15 | $ | 1,000.00 | $ | 1,025.39 | $ | 0.16 | 0.03 | % | ||||||||||||||||||||
Administrative Class | 1,000.00 | 959.30 | 1.40 | 1,000.00 | 1,024.12 | 1.45 | 0.28 | |||||||||||||||||||||||||||
Class A | 1,000.00 | 958.30 | 2.65 | 1,000.00 | 1,022.84 | 2.74 | 0.53 | |||||||||||||||||||||||||||
PIMCO RealPath™ Blend 2030 Fund | ||||||||||||||||||||||||||||||||||
Institutional Class | $ | 1,000.00 | $ | 953.50 | $ | 0.20 | $ | 1,000.00 | $ | 1,025.34 | $ | 0.21 | 0.04 | % | ||||||||||||||||||||
Administrative Class | 1,000.00 | 951.90 | 1.45 | 1,000.00 | 1,024.06 | 1.50 | 0.29 | |||||||||||||||||||||||||||
Class A | 1,000.00 | 950.70 | 2.69 | 1,000.00 | 1,022.79 | 2.79 | 0.54 | |||||||||||||||||||||||||||
PIMCO RealPath™ Blend 2035 Fund | ||||||||||||||||||||||||||||||||||
Institutional Class | $ | 1,000.00 | $ | 946.60 | $ | 0.25 | $ | 1,000.00 | $ | 1,025.29 | $ | 0.26 | 0.05 | % | ||||||||||||||||||||
Administrative Class | 1,000.00 | 944.80 | 1.49 | 1,000.00 | 1,024.01 | 1.55 | 0.30 | |||||||||||||||||||||||||||
Class A | 1,000.00 | 944.50 | 2.73 | 1,000.00 | 1,022.74 | 2.84 | 0.55 |
26 | PIMCO EQUITY SERIES |
Table of Contents
Actual | Hypothetical (5% return before expenses) | |||||||||||||||||||||||||||||||||
Beginning Account Value (07/01/15) | Ending Account Value (12/31/15) | Expenses Paid During Period* | Beginning Account Value (07/01/15) | Ending Account Value (12/31/15) | Expenses Paid During Period* | Net Annualized | ||||||||||||||||||||||||||||
PIMCO RealPath™ Blend 2040 Fund | ||||||||||||||||||||||||||||||||||
Institutional Class | $ | 1,000.00 | $ | 948.40 | $ | 0.25 | $ | 1,000.00 | $ | 1,025.29 | $ | 0.26 | 0.05 | % | ||||||||||||||||||||
Administrative Class | 1,000.00 | 947.20 | 1.49 | 1,000.00 | 1,024.01 | 1.55 | 0.30 | |||||||||||||||||||||||||||
Class A | 1,000.00 | 946.00 | 2.73 | 1,000.00 | 1,022.74 | 2.84 | 0.55 | |||||||||||||||||||||||||||
PIMCO RealPath™ Blend 2045 Fund | ||||||||||||||||||||||||||||||||||
Institutional Class | $ | 1,000.00 | $ | 943.00 | $ | 0.25 | $ | 1,000.00 | $ | 1,025.29 | $ | 0.26 | 0.05 | % | ||||||||||||||||||||
Administrative Class | 1,000.00 | 942.40 | 1.49 | 1,000.00 | 1,024.01 | 1.55 | 0.30 | |||||||||||||||||||||||||||
Class A | 1,000.00 | 941.70 | 2.73 | 1,000.00 | 1,022.74 | 2.84 | 0.55 | |||||||||||||||||||||||||||
PIMCO RealPath™ Blend 2050 Fund | ||||||||||||||||||||||||||||||||||
Institutional Class | $ | 1,000.00 | $ | 945.20 | $ | 0.25 | $ | 1,000.00 | $ | 1,025.29 | $ | 0.26 | 0.05 | % | ||||||||||||||||||||
Administrative Class | 1,000.00 | 944.40 | 1.49 | 1,000.00 | 1,024.01 | 1.55 | 0.30 | |||||||||||||||||||||||||||
Class A | 1,000.00 | 942.40 | 2.73 | 1,000.00 | 1,022.74 | 2.84 | 0.55 | |||||||||||||||||||||||||||
PIMCO RealPath™ Blend 2055 Fund | ||||||||||||||||||||||||||||||||||
Institutional Class | $ | 1,000.00 | $ | 944.70 | $ | 0.25 | $ | 1,000.00 | $ | 1,025.29 | $ | 0.26 | 0.05 | % | ||||||||||||||||||||
Administrative Class | 1,000.00 | 943.00 | 1.49 | 1,000.00 | 1,024.01 | 1.55 | 0.30 | |||||||||||||||||||||||||||
Class A | 1,000.00 | 941.30 | 2.73 | 1,000.00 | 1,022.74 | 2.84 | 0.55 | |||||||||||||||||||||||||||
PIMCO RealPath™ Blend Income Fund | ||||||||||||||||||||||||||||||||||
Institutional Class | $ | 1,000.00 | $ | 973.40 | $ | 0.15 | $ | 1,000.00 | $ | 1,025.39 | $ | 0.16 | 0.03 | % | ||||||||||||||||||||
Administrative Class | 1,000.00 | 972.20 | 1.41 | 1,000.00 | 1,024.12 | 1.45 | 0.28 | |||||||||||||||||||||||||||
Class A | 1,000.00 | 971.00 | 2.67 | 1,000.00 | 1,022.84 | 2.74 | 0.53 |
* Expenses Paid During Period are equal to the net annualized expense ratio for the class, multiplied by the average account value over the period, multiplied by 187/366(to reflect the one-half year period).
** Net Annualized Expense Ratio is reflective of any applicable contractual fee waivers and/or expense reimbursements or voluntary fee waivers. Details regarding fee waivers can be found in Note 7 in the Notes to Financial Statements.
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 27 |
Table of Contents
Selected Per Share Data for the Year or Period Ended: | Net Asset Value Beginning of Year or Period | Net Investment Income (a) | Net Realized/ Unrealized Gain (Loss) | Total from Investment Operations | Dividends from Net Investment Income (b) | Distributions | Total Distributions | |||||||||||||||||||||
PIMCO RealPath™ Blend 2020 Fund | ||||||||||||||||||||||||||||
Institutional Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 9.97 | $ | 0.20 | $ | (0.55 | ) | $ | (0.35 | ) | $ | (0.17 | ) | $ | (0.02 | ) | $ | (0.19 | ) | |||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.11 | (0.09 | ) | 0.02 | (0.05 | ) | 0.00 | (0.05 | ) | ||||||||||||||||||
Administrative Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.97 | 0.18 | (0.54 | ) | (0.36 | ) | (0.16 | ) | (0.02 | ) | (0.18 | ) | ||||||||||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.10 | (0.09 | ) | 0.01 | (0.04 | ) | 0.00 | (0.04 | ) | ||||||||||||||||||
Class A | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.97 | 0.17 | (0.54 | ) | (0.37 | ) | (0.14 | ) | (0.02 | ) | (0.16 | ) | ||||||||||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.09 | (0.09 | ) | 0.00 | (0.03 | ) | 0.00 | (0.03 | ) | ||||||||||||||||||
PIMCO RealPath™ Blend 2025 Fund | ||||||||||||||||||||||||||||
Institutional Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 9.99 | $ | 0.19 | $ | (0.58 | ) | $ | (0.39 | ) | $ | (0.17 | ) | $ | (0.02 | ) | $ | (0.19 | ) | |||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.12 | (0.08 | ) | 0.04 | (0.05 | ) | 0.00 | (0.05 | ) | ||||||||||||||||||
Administrative Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.99 | 0.17 | (0.57 | ) | (0.40 | ) | (0.16 | ) | (0.02 | ) | (0.18 | ) | ||||||||||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.11 | (0.08 | ) | 0.03 | (0.04 | ) | 0.00 | (0.04 | ) | ||||||||||||||||||
Class A | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.99 | 0.16 | (0.57 | ) | (0.41 | ) | (0.14 | ) | (0.02 | ) | (0.16 | ) | ||||||||||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.10 | (0.08 | ) | 0.02 | (0.03 | ) | 0.00 | (0.03 | ) | ||||||||||||||||||
PIMCO RealPath™ Blend 2030 Fund | ||||||||||||||||||||||||||||
Institutional Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 10.00 | $ | 0.18 | $ | (0.64 | ) | $ | (0.46 | ) | $ | (0.17 | ) | $ | (0.03 | ) | $ | (0.20 | ) | |||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.13 | (0.08 | ) | 0.05 | (0.05 | ) | 0.00 | (0.05 | ) | ||||||||||||||||||
Administrative Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.00 | 0.17 | (0.65 | ) | (0.48 | ) | (0.15 | ) | (0.03 | ) | (0.18 | ) | ||||||||||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.12 | (0.08 | ) | 0.04 | (0.04 | ) | 0.00 | (0.04 | ) | ||||||||||||||||||
Class A | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.00 | 0.16 | (0.65 | ) | (0.49 | ) | (0.14 | ) | (0.03 | ) | (0.17 | ) | ||||||||||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.10 | (0.07 | ) | 0.03 | (0.03 | ) | 0.00 | (0.03 | ) | ||||||||||||||||||
PIMCO RealPath™ Blend 2035 Fund | ||||||||||||||||||||||||||||
Institutional Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 10.04 | $ | 0.16 | $ | (0.69 | ) | $ | (0.53 | ) | $ | (0.15 | ) | $ | (0.03 | ) | $ | (0.18 | ) | |||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.13 | (0.04 | ) | 0.09 | (0.05 | ) | 0.00 | (0.05 | ) | ||||||||||||||||||
Administrative Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.04 | 0.14 | (0.69 | ) | (0.55 | ) | (0.13 | ) | (0.03 | ) | (0.16 | ) | ||||||||||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.11 | (0.03 | ) | 0.08 | (0.04 | ) | 0.00 | (0.04 | ) | ||||||||||||||||||
Class A | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.03 | 0.10 | (0.65 | ) | (0.55 | ) | (0.09 | ) | (0.03 | ) | (0.12 | ) | ||||||||||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.12 | (0.05 | ) | 0.07 | (0.04 | ) | 0.00 | (0.04 | ) | ||||||||||||||||||
PIMCO RealPath™ Blend 2040 Fund | ||||||||||||||||||||||||||||
Institutional Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 10.07 | $ | 0.16 | $ | (0.68 | ) | $ | (0.52 | ) | $ | (0.13 | ) | $ | (0.03 | ) | $ | (0.16 | ) | |||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.12 | 0.00 | 0.12 | (0.05 | ) | 0.00 | (0.05 | ) | |||||||||||||||||||
Administrative Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.07 | 0.18 | (0.71 | ) | (0.53 | ) | (0.12 | ) | (0.03 | ) | (0.15 | ) | ||||||||||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.11 | 0.00 | 0.11 | (0.04 | ) | 0.00 | (0.04 | ) | |||||||||||||||||||
Class A | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.07 | 0.16 | (0.70 | ) | (0.54 | ) | (0.11 | ) | (0.03 | ) | (0.14 | ) | ||||||||||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.10 | 0.00 | 0.10 | (0.03 | ) | 0.00 | (0.03 | ) | |||||||||||||||||||
PIMCO RealPath™ Blend 2045 Fund | ||||||||||||||||||||||||||||
Institutional Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 10.10 | $ | 0.15 | $ | (0.72 | ) | $ | (0.57 | ) | $ | (0.13 | ) | $ | (0.03 | ) | $ | (0.16 | ) | |||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.12 | 0.03 | 0.15 | (0.05 | ) | 0.00 | (0.05 | ) | |||||||||||||||||||
Administrative Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.09 | 0.14 | (0.72 | ) | (0.58 | ) | (0.11 | ) | (0.03 | ) | (0.14 | ) | ||||||||||||||||
12/31/2014 - 06/30/2015 | 10.00 | �� | 0.14 | (0.01 | ) | 0.13 | (0.04 | ) | 0.00 | (0.04 | ) |
Please see footnotes on page 30.
28 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
Net Asset Value End of Year or Period | Total Return | Net Assets End of Year or Period (000s) | Ratio of Expenses to Average Net Assets | Ratio of Expenses to Average Net Assets Excluding Waivers | Ratio of Expenses to Average Net Assets Excluding Interest Expense | Ratio of Expenses to Average Net Assets Excluding Interest Expense and Waivers | Ratio of Net Investment Income to Average Net Assets | Portfolio Turnover Rate | ||||||||||||||||||||||||||
$ | 9.43 | (3.45 | )% | $ | 3,011 | 0.03 | %* | 0.03 | %* | 0.03 | %* | 0.03 | %* | 3.99 | %* | 5 | % | |||||||||||||||||
9.97 | 0.19 | 3,007 | 0.03 | * | 0.57 | * | 0.03 | * | 0.57 | * | 2.20 | * | 5 | |||||||||||||||||||||
9.43 | (3.63 | ) | 10 | 0.28 | * | 0.28 | * | 0.28 | * | 0.28 | * | 3.67 | * | 5 | ||||||||||||||||||||
9.97 | 0.08 | 10 | 0.28 | * | 0.82 | * | 0.28 | * | 0.82 | * | 1.92 | * | 5 | |||||||||||||||||||||
9.44 | (3.68 | ) | 10 | 0.53 | * | 0.53 | * | 0.53 | * | 0.53 | * | 3.47 | * | 5 | ||||||||||||||||||||
9.97 | (0.03 | ) | 10 | 0.53 | * | 1.07 | * | 0.53 | * | 1.07 | * | 1.70 | * | 5 | ||||||||||||||||||||
$ | 9.41 | (3.91 | )% | $ | 2,920 | 0.03 | %* | 0.03 | %* | 0.03 | %* | 0.03 | %* | 3.87 | %* | 5 | % | |||||||||||||||||
9.99 | 0.39 | 3,026 | 0.03 | * | 0.57 | * | 0.03 | * | 0.57 | * | 2.38 | * | 5 | |||||||||||||||||||||
9.41 | (4.07 | ) | 15 | 0.28 | * | 0.28 | * | 0.28 | * | 0.28 | * | 3.50 | * | 5 | ||||||||||||||||||||
9.99 | 0.30 | 15 | 0.28 | * | 0.82 | * | 0.28 | * | 0.82 | * | 2.20 | * | 5 | |||||||||||||||||||||
9.42 | (4.17 | ) | 10 | 0.53 | * | 0.53 | * | 0.53 | * | 0.53 | * | 3.16 | * | 5 | ||||||||||||||||||||
9.99 | 0.17 | 11 | 0.53 | * | 1.07 | * | 0.53 | * | 1.07 | * | 1.92 | * | 5 | |||||||||||||||||||||
$ | 9.34 | (4.65 | )% | $ | 2,994 | 0.04 | %* | 0.04 | %* | 0.04 | %* | 0.04 | %* | 3.60 | %* | 6 | % | |||||||||||||||||
10.00 | 0.49 | 3,015 | 0.04 | * | 0.58 | * | 0.04 | * | 0.58 | * | 2.55 | * | 6 | |||||||||||||||||||||
9.34 | (4.81 | ) | 11 | 0.29 | * | 0.29 | * | 0.29 | * | 0.29 | * | 3.46 | * | 6 | ||||||||||||||||||||
10.00 | 0.37 | 10 | 0.29 | * | 0.83 | * | 0.29 | * | 0.83 | * | 2.30 | * | 6 | |||||||||||||||||||||
9.34 | (4.93 | ) | 13 | 0.54 | * | 0.54 | * | 0.54 | * | 0.54 | * | 3.31 | * | 6 | ||||||||||||||||||||
10.00 | 0.27 | 10 | 0.54 | * | 1.08 | * | 0.54 | * | 1.08 | * | 2.04 | * | 6 | |||||||||||||||||||||
$ | 9.33 | (5.34 | )% | $ | 3,301 | 0.05 | %* | 0.05 | %* | 0.05 | %* | 0.05 | %* | 3.23 | %* | 5 | % | |||||||||||||||||
10.04 | 0.89 | 3,027 | 0.05 | * | 0.58 | * | 0.05 | * | 0.58 | * | 2.48 | * | 6 | |||||||||||||||||||||
9.33 | (5.52 | ) | 10 | 0.30 | * | 0.30 | * | 0.30 | * | 0.30 | * | 2.93 | * | 5 | ||||||||||||||||||||
10.04 | 0.77 | 10 | 0.30 | * | 0.83 | * | 0.30 | * | 0.83 | * | 2.22 | * | 6 | |||||||||||||||||||||
9.36 | (5.55 | ) | 9 | 0.55 | * | 0.55 | * | 0.55 | * | 0.55 | * | 2.11 | * | 5 | ||||||||||||||||||||
10.03 | 0.65 | 22 | 0.55 | * | 1.08 | * | 0.55 | * | 1.08 | * | 2.33 | * | 6 | |||||||||||||||||||||
$ | 9.39 | (5.16 | )% | $ | 2,895 | 0.05 | %* | 0.05 | %* | 0.05 | %* | 0.05 | %* | 3.12 | %* | 5 | % | |||||||||||||||||
10.07 | 1.19 | 3,036 | 0.05 | * | 0.58 | * | 0.05 | * | 0.58 | * | 2.39 | * | 6 | |||||||||||||||||||||
9.39 | (5.28 | ) | 33 | 0.30 | * | 0.30 | * | 0.30 | * | 0.30 | * | 3.62 | * | 5 | ||||||||||||||||||||
10.07 | 1.08 | 12 | 0.30 | * | 0.83 | * | 0.30 | * | 0.83 | * | 2.20 | * | 6 | |||||||||||||||||||||
9.39 | (5.40 | ) | 31 | 0.55 | * | 0.55 | * | 0.55 | * | 0.55 | * | 3.33 | * | 5 | ||||||||||||||||||||
10.07 | 0.98 | 11 | 0.55 | * | 1.08 | * | 0.55 | * | 1.08 | * | 1.93 | * | 6 | |||||||||||||||||||||
$ | 9.37 | (5.70 | )% | $ | 2,958 | 0.05 | %* | 0.05 | %* | 0.05 | %* | 0.05 | %* | 3.07 | %* | 5 | % | |||||||||||||||||
10.10 | 1.48 | 3,044 | 0.05 | * | 0.58 | * | 0.05 | * | 0.58 | * | 2.37 | * | 6 | |||||||||||||||||||||
9.37 | (5.76 | ) | 37 | 0.30 | * | 0.30 | * | 0.30 | * | 0.30 | * | 2.80 | * | 5 | ||||||||||||||||||||
10.09 | 1.33 | 39 | 0.30 | * | 0.83 | * | 0.30 | * | 0.83 | * | 2.69 | * | 6 |
Please see footnotes on page 30.
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 29 |
Table of Contents
Financial Highlights (Cont.)
Selected Per Share Data for the Year or Period Ended: | Net Asset Value Beginning of Year or Period | Net Investment Income (a) | Net Realized/ Unrealized Gain (Loss) | Total from Investment Operations | Dividends from Net Investment Income (b) | Distributions | Total Distributions | |||||||||||||||||||||
PIMCO RealPath™ Blend 2045 Fund (Cont.) | ||||||||||||||||||||||||||||
Class A | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 10.09 | $ | 0.13 | $ | (0.72 | ) | $ | (0.59 | ) | $ | (0.09 | ) | $ | (0.03 | ) | $ | (0.12 | ) | |||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.09 | 0.03 | 0.12 | (0.03 | ) | 0.00 | (0.03 | ) | |||||||||||||||||||
PIMCO RealPath™ Blend 2050 Fund | ||||||||||||||||||||||||||||
Institutional Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 10.11 | $ | 0.15 | $ | (0.70 | ) | $ | (0.55 | ) | $ | (0.13 | ) | $ | (0.03 | ) | $ | (0.16 | ) | |||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.12 | 0.04 | 0.16 | (0.05 | ) | 0.00 | (0.05 | ) | |||||||||||||||||||
Administrative Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.10 | 0.14 | (0.70 | ) | (0.56 | ) | (0.11 | ) | (0.03 | ) | (0.14 | ) | ||||||||||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.12 | 0.02 | 0.14 | (0.04 | ) | 0.00 | (0.04 | ) | |||||||||||||||||||
Class A | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.10 | 0.16 | (0.74 | ) | (0.58 | ) | (0.11 | ) | (0.03 | ) | (0.14 | ) | ||||||||||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.10 | 0.03 | 0.13 | (0.03 | ) | 0.00 | (0.03 | ) | |||||||||||||||||||
PIMCO RealPath™ Blend 2055 Fund | ||||||||||||||||||||||||||||
Institutional Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 10.11 | $ | 0.15 | $ | (0.71 | ) | $ | (0.56 | ) | $ | (0.13 | ) | $ | (0.03 | ) | $ | (0.16 | ) | |||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.12 | 0.04 | 0.16 | (0.05 | ) | 0.00 | (0.05 | ) | |||||||||||||||||||
Administrative Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.11 | 0.14 | (0.71 | ) | (0.57 | ) | (0.12 | ) | (0.03 | ) | (0.15 | ) | ||||||||||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.11 | 0.04 | 0.15 | (0.04 | ) | 0.00 | (0.04 | ) | |||||||||||||||||||
Class A | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 10.09 | 0.13 | (0.72 | ) | (0.59 | ) | (0.10 | ) | (0.03 | ) | (0.13 | ) | ||||||||||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.13 | 0.00 | 0.13 | (0.04 | ) | 0.00 | (0.04 | ) | |||||||||||||||||||
PIMCO RealPath™ Blend Income Fund | ||||||||||||||||||||||||||||
Institutional Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | $ | 9.95 | $ | 0.20 | $ | (0.46 | ) | $ | (0.26 | ) | $ | (0.18 | ) | $ | (0.02 | ) | $ | (0.20 | ) | |||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.10 | (0.10 | ) | 0.00 | (0.05 | ) | 0.00 | (0.05 | ) | ||||||||||||||||||
Administrative Class | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.94 | 0.17 | (0.44 | ) | (0.27 | ) | (0.16 | ) | (0.02 | ) | (0.18 | ) | ||||||||||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.09 | (0.11 | ) | (0.02 | ) | (0.04 | ) | 0.00 | (0.04 | ) | |||||||||||||||||
Class A | ||||||||||||||||||||||||||||
07/01/2015 - 12/31/2015+ | 9.94 | 0.17 | (0.45 | ) | (0.28 | ) | (0.15 | ) | (0.02 | ) | (0.17 | ) | ||||||||||||||||
12/31/2014 - 06/30/2015 | 10.00 | 0.13 | (0.15 | ) | (0.02 | ) | (0.04 | ) | 0.00 | (0.04 | ) |
+ | Unaudited |
* | Annualized |
(a) | Per share amounts based on average number of shares outstanding during the year or period. |
(b) | Determined in accordance with federal income tax regulations, see Note 2(d) in the Notes to Financial Statements for more information. |
30 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
Net Asset Value End of Year or Period | Total Return | Net Assets End of Year or Period (000s) | Ratio of Expenses to Average Net Assets | Ratio of Expenses to Average Net Assets Excluding Waivers | Ratio of Expenses to Average Net Assets Excluding Interest Expense | Ratio of Expenses to Average Net Assets Excluding Interest Expense and Waivers | Ratio of Net Investment Income to Average Net Assets | Portfolio Turnover Rate | ||||||||||||||||||||||||||
$ | 9.38 | (5.83 | )% | $ | 9 | 0.55 | %* | 0.55 | %* | 0.55 | %* | 0.55 | %* | 2.56 | %* | 5 | % | |||||||||||||||||
10.09 | 1.16 | 10 | 0.55 | * | 1.08 | * | 0.55 | * | 1.08 | * | 1.86 | * | 6 | |||||||||||||||||||||
$ | 9.40 | (5.48 | )% | $ | 2,916 | 0.05 | %* | 0.05 | %* | 0.05 | %* | 0.05 | %* | 3.04 | %* | 4 | % | |||||||||||||||||
10.11 | 1.59 | 3,046 | 0.05 | * | 0.58 | * | 0.05 | * | 0.58 | * | 2.39 | * | 6 | |||||||||||||||||||||
9.40 | (5.56 | ) | 13 | 0.30 | * | 0.30 | * | 0.30 | * | 0.30 | * | 2.77 | * | 4 | ||||||||||||||||||||
10.10 | 1.39 | 14 | 0.30 | * | 0.83 | * | 0.30 | * | 0.83 | * | 2.33 | * | 6 | |||||||||||||||||||||
9.38 | (5.76 | ) | 72 | 0.55 | * | 0.55 | * | 0.55 | * | 0.55 | * | 3.26 | * | 4 | ||||||||||||||||||||
10.10 | 1.31 | 15 | 0.55 | * | 1.08 | * | 0.55 | * | 1.08 | * | 2.05 | * | 6 | |||||||||||||||||||||
$ | 9.39 | (5.53 | )% | $ | 2,892 | 0.05 | %* | 0.05 | %* | 0.05 | %* | 0.05 | %* | 3.03 | %* | 5 | % | |||||||||||||||||
10.11 | 1.58 | 3,048 | 0.05 | * | 0.58 | * | 0.05 | * | 0.58 | * | 2.39 | * | 5 | |||||||||||||||||||||
9.39 | (5.70 | ) | 10 | 0.30 | * | 0.30 | * | 0.30 | * | 0.30 | * | 2.77 | * | 5 | ||||||||||||||||||||
10.11 | 1.47 | 11 | 0.30 | * | 0.83 | * | 0.30 | * | 0.83 | * | 2.18 | * | 5 | |||||||||||||||||||||
9.37 | (5.87 | ) | 62 | 0.55 | * | 0.55 | * | 0.55 | * | 0.55 | * | 2.53 | * | 5 | ||||||||||||||||||||
10.09 | 1.28 | 66 | 0.55 | * | 1.08 | * | 0.55 | * | 1.08 | * | 2.53 | * | 5 | |||||||||||||||||||||
$ | 9.49 | (2.66 | )% | $ | 3,013 | 0.03 | %* | 0.03 | %* | 0.03 | %* | 0.03 | %* | 4.04 | %* | 6 | % | |||||||||||||||||
9.95 | (0.02 | ) | 3,035 | 0.03 | * | 0.56 | * | 0.03 | * | 0.56 | * | 2.03 | * | 4 | ||||||||||||||||||||
9.49 | (2.78 | ) | 10 | 0.28 | * | 0.28 | * | 0.28 | * | 0.28 | * | 3.46 | * | 6 | ||||||||||||||||||||
9.94 | (0.21 | ) | 14 | 0.28 | * | 0.81 | * | 0.28 | * | 0.81 | * | 1.84 | * | 4 | ||||||||||||||||||||
9.49 | (2.90 | ) | 57 | 0.53 | * | 0.53 | * | 0.53 | * | 0.53 | * | 3.48 | * | 6 | ||||||||||||||||||||
9.94 | (0.22 | ) | 73 | 0.53 | * | 1.06 | * | 0.53 | * | 1.06 | * | 2.61 | * | 4 |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 31 |
Table of Contents
Statements of Assets and Liabilities
(Amounts in thousands†, except per share amounts) | PIMCO RealPath™ Blend 2020 Fund | PIMCO RealPath™ Blend 2025 Fund | PIMCO RealPath™ Blend 2030 Fund | PIMCO RealPath™ Blend 2035 Fund | ||||||||||||
Assets: | ||||||||||||||||
Investments, at value | ||||||||||||||||
Investments in securities | $ | 1,210 | $ | 1,841 | $ | 1,815 | $ | 2,337 | ||||||||
Investments in Affiliates | 1,751 | 1,755 | 1,133 | 916 | ||||||||||||
Financial Derivative Instruments | ||||||||||||||||
Exchange-traded or centrally cleared | 12 | 15 | 13 | 19 | ||||||||||||
Over the counter | 1 | 1 | 1 | 1 | ||||||||||||
Cash | 62 | 77 | 63 | 59 | ||||||||||||
Receivable for Fund shares sold | 0 | 0 | 0 | 1 | ||||||||||||
Dividends receivable | 4 | 5 | 3 | 3 | ||||||||||||
Total Assets | 3,040 | 3,694 | 3,028 | 3,336 | ||||||||||||
Liabilities: | ||||||||||||||||
Financial Derivative Instruments | ||||||||||||||||
Exchange-traded or centrally cleared | $ | 5 | $ | 8 | $ | 6 | $ | 13 | ||||||||
Payable for investments purchased | 0 | 0 | 0 | 0 | ||||||||||||
Payable for investments in Affiliates purchased | 4 | 5 | 3 | 3 | ||||||||||||
Payable for Fund shares redeemed | 0 | 736 | 0 | 0 | ||||||||||||
Accrued investment advisory fees | 0 | 0 | 0 | 0 | ||||||||||||
Accrued reimbursement to PIMCO | 0 | 0 | 1 | 0 | ||||||||||||
Total Liabilities | 9 | 749 | 10 | 16 | ||||||||||||
Net Assets | $ | 3,031 | $ | 2,945 | $ | 3,018 | $ | 3,320 | ||||||||
Net Assets Consist of: | ||||||||||||||||
Paid in capital | $ | 3,209 | $ | 3,168 | $ | 3,226 | $ | 3,558 | ||||||||
Undistributed net investment income | 20 | 21 | 20 | 20 | ||||||||||||
Accumulated undistributed net realized gain (loss) | 7 | 3 | (4 | ) | (10 | ) | ||||||||||
Net unrealized (depreciation) | (205 | ) | (247 | ) | (224 | ) | (248 | ) | ||||||||
$ | 3,031 | $ | 2,945 | $ | 3,018 | $ | 3,320 | |||||||||
Net Assets: | ||||||||||||||||
Institutional Class | $ | 3,011 | $ | 2,920 | $ | 2,994 | $ | 3,301 | ||||||||
Administrative Class | 10 | 15 | 11 | 10 | ||||||||||||
Class A | 10 | 10 | 13 | 9 | ||||||||||||
Shares Issued and Outstanding: | ||||||||||||||||
Institutional Class | 319 | 311 | 321 | 354 | ||||||||||||
Administrative Class | 1 | 1 | 1 | 1 | ||||||||||||
Class A | 1 | 1 | 1 | 1 | ||||||||||||
Net Asset Value and Redemption Price^ Per Share Outstanding: | ||||||||||||||||
Institutional Class | $ | 9.43 | $ | 9.41 | $ | 9.34 | $ | 9.33 | ||||||||
Administrative Class | 9.43 | 9.41 | 9.34 | 9.33 | ||||||||||||
Class A | 9.44 | 9.42 | 9.34 | 9.36 | ||||||||||||
Cost of investments in securities | $ | 1,270 | $ | 1,936 | $ | 1,912 | $ | 2,471 | ||||||||
Cost of investments in Affiliates | $ | 1,891 | $ | 1,900 | $ | 1,255 | $ | 1,025 | ||||||||
Cost or premiums of financial derivative instruments, net | $ | 12 | $ | 15 | $ | 12 | $ | 13 |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
^ | With respect to the A Class, the redemption price varies by the length of time the shares are held. |
32 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
PIMCO RealPath™ Blend 2040 Fund | PIMCO RealPath™ Blend 2045 Fund | PIMCO RealPath™ Blend 2050 Fund | PIMCO RealPath™ Blend 2055 Fund | PIMCO RealPath™ Blend Income Fund | ||||||||||||||
$ | 2,223 | $ | 2,408 | $ | 2,480 | $ | 2,450 | $ | 1,000 | |||||||||
667 | 526 | 451 | 445 | 2,009 | ||||||||||||||
15 | 15 | 15 | 15 | 12 | ||||||||||||||
1 | 1 | 1 | 1 | 1 | ||||||||||||||
63 | 63 | 63 | 62 | 63 | ||||||||||||||
0 | 1 | 0 | 0 | 0 | ||||||||||||||
2 | 2 | 2 | 2 | 4 | ||||||||||||||
2,971 | 3,016 | 3,012 | 2,975 | 3,089 | ||||||||||||||
$ | 9 | $ | 9 | $ | 9 | $ | 9 | $ | 5 | |||||||||
0 | 0 | 2 | 2 | 4 | ||||||||||||||
2 | 2 | 0 | 0 | 0 | ||||||||||||||
0 | 0 | 0 | 0 | 0 | ||||||||||||||
1 | 1 | 0 | 0 | 0 | ||||||||||||||
0 | 0 | 0 | 0 | 0 | ||||||||||||||
12 | 12 | 11 | 11 | 9 | ||||||||||||||
$ | 2,959 | $ | 3,004 | $ | 3,001 | $ | 2,964 | $ | 3,080 | |||||||||
$ | 3,145 | $ | 3,203 | $ | 3,192 | $ | 3,157 | $ | 3,243 | |||||||||
23 | 24 | 21 | 22 | 19 | ||||||||||||||
(8 | ) | (12 | ) | (10 | ) | (12 | ) | 5 | ||||||||||
(201 | ) | (211 | ) | (202 | ) | (203 | ) | (187 | ) | |||||||||
$ | 2,959 | $ | 3,004 | $ | 3,001 | $ | 2,964 | $ | 3,080 | |||||||||
$ | 2,895 | $ | 2,958 | $ | 2,916 | $ | 2,892 | $ | 3,013 | |||||||||
33 | 37 | 13 | 10 | 10 | ||||||||||||||
31 | 9 | 72 | 62 | 57 | ||||||||||||||
308 | 316 | 310 | 308 | 318 | ||||||||||||||
4 | 4 | 1 | 1 | 2 | ||||||||||||||
3 | 1 | 8 | 7 | 5 | ||||||||||||||
$ | 9.39 | $ | 9.37 | $ | 9.40 | $ | 9.39 | $ | 9.49 | |||||||||
9.39 | 9.37 | 9.40 | 9.39 | 9.49 | ||||||||||||||
9.39 | 9.38 | 9.38 | 9.37 | 9.49 | ||||||||||||||
$ | 2,344 | $ | 2,550 | $ | 2,620 | $ | 2,592 | $ | 1,042 | |||||||||
$ | 743 | $ | 590 | $ | 507 | $ | 501 | $ | 2,149 | |||||||||
$ | 11 | $ | 12 | $ | 13 | $ | 13 | $ | 12 |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 33 |
Table of Contents
Six Months Ended December 31, 2015 | ||||||||||||||||
(Amounts in thousands†) | PIMCO RealPath™ Blend 2020 Fund | PIMCO RealPath™ Blend 2025 Fund | PIMCO RealPath™ Blend 2030 Fund | PIMCO RealPath™ Blend 2035 Fund | ||||||||||||
Investment Income: | ||||||||||||||||
Dividends | $ | 17 | $ | 28 | $ | 27 | $ | 34 | ||||||||
Dividends from Investments in Affiliates | 46 | 44 | 30 | 22 | ||||||||||||
Total Income | 63 | 72 | 57 | 56 | ||||||||||||
Expenses: | ||||||||||||||||
Investment advisory fees | 0 | 0 | 0 | 1 | ||||||||||||
Supervisory and administrative fees | 1 | 1 | 1 | 0 | ||||||||||||
Total Expenses | 1 | 1 | 1 | 1 | ||||||||||||
Net Investment Income | 62 | 71 | 56 | 55 | ||||||||||||
Net Realized Gain (Loss): | ||||||||||||||||
Investments in securities | (1 | ) | (1 | ) | (2 | ) | (1 | ) | ||||||||
Investments in Affiliates | (2 | ) | (2 | ) | (2 | ) | (3 | ) | ||||||||
Net capital gain distributions received from Affiliate investments | 27 | 25 | 15 | 11 | ||||||||||||
Over the counter financial derivative instruments | (19 | ) | (22 | ) | (19 | ) | (20 | ) | ||||||||
Net Realized Gain (Loss) | 5 | 0 | (8 | ) | (13 | ) | ||||||||||
Net Change in Unrealized (Depreciation): | ||||||||||||||||
Investments in securities | (71 | ) | (105 | ) | (106 | ) | (151 | ) | ||||||||
Investments in Affiliates | (98 | ) | (107 | ) | (83 | ) | (73 | ) | ||||||||
Exchange-traded or centrally cleared financial derivative instruments | (5 | ) | (5 | ) | (5 | ) | (5 | ) | ||||||||
Over the counter financial derivative instruments | (1 | ) | (2 | ) | (1 | ) | (1 | ) | ||||||||
Net Change in Unrealized (Depreciation) | (175 | ) | (219 | ) | (195 | ) | (230 | ) | ||||||||
Net (Decrease) in Net Assets Resulting from Operations | $ | (108 | ) | $ | (148 | ) | $ | (147 | ) | $ | (188 | ) |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
34 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
(Unaudited)
PIMCO RealPath™ Blend 2040 Fund | PIMCO RealPath™ Blend 2045 Fund | PIMCO RealPath™ Blend 2050 Fund | PIMCO RealPath™ Blend 2055 Fund | PIMCO RealPath™ Blend Income Fund | ||||||||||||||
$ | 32 | $ | 35 | $ | 35 | $ | 35 | $ | 15 | |||||||||
17 | 14 | 13 | 13 | 51 | ||||||||||||||
49 | 49 | 48 | 48 | 66 | ||||||||||||||
1 | 1 | 1 | 1 | 0 | ||||||||||||||
0 | 0 | 0 | 0 | 1 | ||||||||||||||
1 | 1 | 1 | 1 | 1 | ||||||||||||||
48 | 48 | 47 | 47 | 65 | ||||||||||||||
0 | (2 | ) | (2 | ) | (2 | ) | 1 | |||||||||||
(2 | ) | (2 | ) | (1 | ) | (2 | ) | (3 | ) | |||||||||
10 | 8 | 8 | 8 | 25 | ||||||||||||||
(19 | ) | (19 | ) | (19 | ) | (19 | ) | (19 | ) | |||||||||
(11 | ) | (15 | ) | (14 | ) | (15 | ) | 4 | ||||||||||
(141 | ) | (168 | ) | (165 | ) | (167 | ) | (48 | ) | |||||||||
(48 | ) | (39 | ) | (34 | ) | (33 | ) | (98 | ) | |||||||||
(5 | ) | (4 | ) | (5 | ) | (5 | ) | (5 | ) | |||||||||
(1 | ) | (1 | ) | (1 | ) | (1 | ) | (1 | ) | |||||||||
(195 | ) | (212 | ) | (205 | ) | (206 | ) | (152 | ) | |||||||||
$ | (158 | ) | $ | (179 | ) | $ | (172 | ) | $ | (174 | ) | $ | (83 | ) |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 35 |
Table of Contents
Statements of Changes in Net Assets
PIMCO RealPath™ Blend 2020 Fund | PIMCO RealPath™ Blend 2025 Fund | PIMCO RealPath™ Blend 2030 Fund | PIMCO RealPath™ Blend 2035 Fund | |||||||||||||||||||||||||||||
(Amounts in thousands†) | Six Months Ended | Inception date through June 30, 2015 | Six Months Ended December 31, 2015 (Unaudited) | Inception date through June 30, 2015 | Six Months Ended December 31, 2015 (Unaudited) | Inception date through June 30, 2015 | Six Months Ended December 31, 2015 (Unaudited) | Inception date through June 30, 2015 | ||||||||||||||||||||||||
Increase (Decrease) in Net Assets from: | ||||||||||||||||||||||||||||||||
Operations: | ||||||||||||||||||||||||||||||||
Net investment income | $ | 62 | $ | 33 | $ | 71 | $ | 36 | $ | 56 | $ | 39 | $ | 55 | $ | 38 | ||||||||||||||||
Net realized gain (loss) | 5 | 4 | 0 | 5 | (8 | ) | 5 | (13 | ) | 6 | ||||||||||||||||||||||
Net change in unrealized appreciation (depreciation) | (175 | ) | (30 | ) | (219 | ) | (28 | ) | (195 | ) | (29 | ) | (230 | ) | (18 | ) | ||||||||||||||||
Net Increase (Decrease) in Net Assets Resulting from Operations | (108 | ) | 7 | (148 | ) | 13 | (147 | ) | 15 | (188 | ) | 26 | ||||||||||||||||||||
Distributions to Shareholders: | ||||||||||||||||||||||||||||||||
From net investment income (a) | ||||||||||||||||||||||||||||||||
Institutional Class | (55 | ) | (15 | ) | (66 | ) | (15 | ) | (53 | ) | (15 | ) | (51 | ) | (15 | ) | ||||||||||||||||
Administrative Class | (0 | ) | (0 | ) | (0 | ) | (0 | ) | (0 | ) | (0 | ) | (0 | ) | (0 | ) | ||||||||||||||||
Class A | (0 | ) | (0 | ) | (0 | ) | (0 | ) | (0 | ) | (0 | ) | (0 | ) | (0 | ) | ||||||||||||||||
From net realized capital gains (a) | ||||||||||||||||||||||||||||||||
Institutional Class | (7 | ) | 0 | (7 | ) | 0 | (9 | ) | 0 | (10 | ) | 0 | ||||||||||||||||||||
Administrative Class | (0 | ) | 0 | (0 | ) | 0 | (0 | ) | 0 | (0 | ) | 0 | ||||||||||||||||||||
Class A | (0 | ) | 0 | (0 | ) | 0 | (0 | ) | 0 | (0 | ) | 0 | ||||||||||||||||||||
Total Distributions | (62 | ) | (15 | ) | (73 | ) | (15 | ) | (62 | ) | (15 | ) | (61 | ) | (15 | ) | ||||||||||||||||
Portfolio Share Transactions: | ||||||||||||||||||||||||||||||||
Net increase resulting from Fund share transactions** | 174 | 3,035 | 114 | 3,054 | 192 | 3,035 | 510 | 3,048 | ||||||||||||||||||||||||
Total Increase (Decrease) in Net Assets | 4 | 3,027 | (107 | ) | 3,052 | (17 | ) | 3,035 | 261 | 3,059 | ||||||||||||||||||||||
Net Assets: | ||||||||||||||||||||||||||||||||
Beginning of period | 3,027 | 0 | 3,052 | 0 | 3,035 | 0 | 3,059 | 0 | ||||||||||||||||||||||||
End of period* | $ | 3,031 | $ | 3,027 | $ | 2,945 | $ | 3,052 | $ | 3,018 | $ | 3,035 | $ | 3,320 | $ | 3,059 | ||||||||||||||||
* Including undistributed net investment income of: | $ | 20 | $ | 13 | $ | 21 | $ | 16 | $ | 20 | $ | 17 | $ | 20 | $ | 16 |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
(a) | Determined in accordance with federal income tax regulations, see Note 2(d) in the Notes to Financial Statements for more information. |
** | See Note 11 in Notes to Financial Statements. |
36 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
PIMCO RealPath™ Blend 2040 Fund | PIMCO RealPath™ Blend 2045 Fund | PIMCO RealPath™ Blend 2050 Fund | PIMCO RealPath™ Blend 2055 Fund | PIMCO RealPath™ Blend Income Fund | ||||||||||||||||||||||||||||||||||
Six Months Ended | Inception date through June 30, 2015 | Six Months Ended December 31, 2015 (Unaudited) | Inception date through June 30, 2015 | Six Months Ended December 31, 2015 (Unaudited) | Inception date through June 30, 2015 | Six Months Ended December 31, 2015 (Unaudited) | Inception date through June 30, 2015 | Six Months Ended December 31, 2015 (Unaudited) | Inception date through June 30, 2015 | |||||||||||||||||||||||||||||
$ | 48 | $ | 37 | $ | 48 | $ | 36 | $ | 47 | $ | 37 | $ | 47 | $ | 37 | $ | 65 | $ | 31 | |||||||||||||||||||
(11 | ) | 5 | (15 | ) | 6 | (14 | ) | 6 | (15 | ) | 6 | 4 | 1 | |||||||||||||||||||||||||
| (195 | ) | (6 | ) | (212 | ) | 1 | (205 | ) | 3 | (206 | ) | 3 | (152 | ) | (35 | ) | |||||||||||||||||||||
| (158 | ) | 36 | (179 | ) | 43 | (172 | ) | 46 | (174 | ) | 46 | (83 | ) | (3 | ) | ||||||||||||||||||||||
(40 | ) | (15 | ) | (39 | ) | (15 | ) | (40 | ) | (15 | ) | (40 | ) | (15 | ) | (56 | ) | (15 | ) | |||||||||||||||||||
(0 | ) | (0 | ) | (0 | ) | (0 | ) | (0 | ) | (0 | ) | (0 | ) | (0 | ) | (0 | ) | (0 | ) | |||||||||||||||||||
(0 | ) | (0 | ) | (0 | ) | (0 | ) | (1 | ) | (0 | ) | (1 | ) | (0 | ) | (1 | ) | (0 | ) | |||||||||||||||||||
(9 | ) | 0 | (9 | ) | 0 | (8 | ) | 0 | (9 | ) | 0 | (5 | ) | 0 | ||||||||||||||||||||||||
(0 | ) | 0 | (0 | ) | 0 | (0 | ) | 0 | (0 | ) | 0 | (0 | ) | 0 | ||||||||||||||||||||||||
(0 | ) | 0 | (0 | ) | 0 | (0 | ) | 0 | (0 | ) | 0 | (0 | ) | 0 | ||||||||||||||||||||||||
(49 | ) | (15 | ) | (48 | ) | (15 | ) | (49 | ) | (15 | ) | (50 | ) | (15 | ) | (62 | ) | (15 | ) | |||||||||||||||||||
| 107 | | 3,038 | 138 | 3,065 | 147 | 3,044 | 63 | 3,094 | 103 | 3,140 | |||||||||||||||||||||||||||
(100 | ) | 3,059 | (89 | ) | 3,093 | (74 | ) | 3,075 | (161 | ) | 3,125 | (42 | ) | 3,122 | ||||||||||||||||||||||||
3,059 | 0 | 3,093 | 0 | 3,075 | 0 | 3,125 | 0 | 3,122 | 0 | |||||||||||||||||||||||||||||
$ | 2,959 | $ | 3,059 | $ | 3,004 | $ | 3,093 | $ | 3,001 | $ | 3,075 | $ | 2,964 | $ | 3,125 | $ | 3,080 | $ | 3,122 | |||||||||||||||||||
$ | 23 | | $ | 15 | $ | 24 | $ | 15 | $ | 21 | $ | 15 | $ | 22 | $ | 16 | $ | 19 | $ | 11 |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 37 |
Table of Contents
Schedule of Investments PIMCO RealPath™ Blend 2020 Fund
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN SECURITIES 39.9% | ||||||||||||
MUTUAL FUNDS 39.8% | ||||||||||||
Vanguard 500 Index Fund ‘Admiral’ | 2,405 | $ | 453 | |||||||||
Vanguard Developed Markets Index Fund ‘Admiral’ | 19,080 | 226 | ||||||||||
Vanguard Emerging Markets Stock Index Fund ‘Admiral’ | 8,217 | 225 | ||||||||||
Vanguard REIT Index Fund ‘Admiral’ | 1,384 | 156 | ||||||||||
Vanguard Small-Cap Index Fund ‘Admiral’ | 2,773 | 147 | ||||||||||
|
| |||||||||||
Total Mutual Funds (Cost $1,267) |
| 1,207 | ||||||||||
|
| |||||||||||
PRINCIPAL AMOUNT (000S) | ||||||||||||
SHORT-TERM INSTRUMENTS 0.1% | ||||||||||||
U.S. TREASURY BILLS 0.1% | ||||||||||||
0.204% due 01/14/2016 | $ | 3 | 3 | |||||||||
|
| |||||||||||
Total Short-Term Instruments (Cost $3) | 3 | |||||||||||
|
| |||||||||||
Total Investments in Securities (Cost $1,270) | 1,210 | |||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN AFFILIATES 57.8% | ||||||||||||
MUTUAL FUNDS (a) 57.8% | ||||||||||||
PIMCO Emerging Local Bond Fund | 11,285 | $ | 75 | |||||||||
PIMCO Foreign Bond Fund (U.S. Dollar-Hedged) | 23,115 | 229 | ||||||||||
PIMCO High Yield Fund | 18,362 | 152 | ||||||||||
PIMCO Long Duration Total Return Fund | 21,325 | 228 | ||||||||||
PIMCO Real Return Asset Fund | 39,405 | 302 | ||||||||||
PIMCO Real Return Fund | 28,962 | 304 | ||||||||||
PIMCO Total Return Fund | 45,781 | 461 | ||||||||||
|
| |||||||||||
Total Mutual Funds (Cost $1,891) |
| 1,751 | ||||||||||
|
| |||||||||||
Total Investments in Affiliates (Cost $1,891) | 1,751 | |||||||||||
Total Investments 97.7% (Cost $3,161) | $ | 2,961 | ||||||||||
Financial Derivative | ||||||||||||
(Cost or Premiums, net $12) | 8 | |||||||||||
Other Assets and Liabilities, net 2.0% | 62 | |||||||||||
|
| |||||||||||
Net Assets 100.0% | $ | 3,031 | ||||||||||
|
|
NOTES TO SCHEDULE OF INVESTMENTS (AMOUNTS IN THOUSANDS*, EXCEPT NUMBER OF CONTRACTS AND UNITS):
* | A zero balance may reflect actual amounts rounding to less than one thousand. |
(a) | Institutional Class Shares of each Fund. |
(b) FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED
PURCHASED OPTIONS:
OPTIONS ON INDICES
Description | Strike Value | Expiration Date | # of Contracts | Cost | Market Value | |||||||||||||||
Put - CBOE S&P 500 Index | 1,650.000 | 01/15/2016 | 1 | $ | 5 | $ | 0 | |||||||||||||
Put - CBOE S&P 500 Index | 1,750.000 | 03/18/2016 | 2 | 9 | 2 | |||||||||||||||
Put - CBOE S&P 500 Index | 1,850.000 | 06/17/2016 | 1 | 6 | 5 | |||||||||||||||
Put - CBOE S&P 500 Index | 1,750.000 | 09/16/2016 | 1 | 7 | 5 | |||||||||||||||
|
|
|
| |||||||||||||||||
$ | 27 | $ | 12 | |||||||||||||||||
|
|
|
| |||||||||||||||||
Total Purchased Options |
| $ | 27 | $ | 12 | |||||||||||||||
|
|
|
|
WRITTEN OPTIONS:
OPTIONS ON INDICES
Description | Strike Value | Expiration Date | # of Contracts | Premiums (Received) | Market Value | |||||||||||||||
Put - CBOE S&P 500 Index | 1,500.000 | 01/15/2016 | 1 | $ | (3 | ) | $ | 0 | ||||||||||||
Put - CBOE S&P 500 Index | 1,600.000 | 03/18/2016 | 2 | (5 | ) | (1 | ) | |||||||||||||
Put - CBOE S&P 500 Index | 1,650.000 | 06/17/2016 | 1 | (3 | ) | (2 | ) | |||||||||||||
Put - CBOE S&P 500 Index | 1,500.000 | 09/16/2016 | 1 | (4 | ) | (2 | ) | |||||||||||||
|
|
|
| |||||||||||||||||
$ | (15 | ) | $ | (5 | ) | |||||||||||||||
|
|
|
| |||||||||||||||||
Total Written Options |
| $ | (15 | ) | $ | (5 | ) | |||||||||||||
|
|
|
|
38 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED SUMMARY
The following is a summary of the market value and variation margin of Exchange-Traded or Centrally Cleared Financial Derivative Instruments as of December 31, 2015:
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||
Market Value | Variation Margin Asset | Market Value | Variation Margin Liability | |||||||||||||||||||||||||||||||
Purchased Options | Futures | Swap Agreements | Total | Written Options | Futures | Swap Agreements | Total | |||||||||||||||||||||||||||
Total Exchange-Traded or Centrally Cleared | $ | 12 | $ | 0 | $ | 0 | $ | 12 | $ | (5) | $ | 0 | $ | 0 | $ | (5) | ||||||||||||||||||
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|
(c) FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER
TRANSACTIONS IN WRITTEN CALL AND PUT OPTIONS FOR THE PERIOD ENDED DECEMBER 31, 2015:
# of Contracts | Premiums | |||||||
Balance at Beginning of Period | 3 | $ | (9 | ) | ||||
Sales | 2 | (6 | ) | |||||
Closing Buys | 0 | 0 | ||||||
Expirations | 0 | 0 | ||||||
Exercised | 0 | 0 | ||||||
|
|
|
| |||||
Balance at End of Period | 5 | $ | (15 | ) | ||||
|
|
|
|
SWAP AGREEMENTS:
TOTAL RETURN SWAPS ON COMMODITY INDICES
Counterparty | Pay/Receive (1) | Underlying Reference | # of Units | Financing Rate | Maturity Date | Notional Amount | Unrealized Appreciation | Swap Agreements, at Value | ||||||||||||||||||||||
Asset | Liability | |||||||||||||||||||||||||||||
CBK | Receive | BCOMTR Index | 470 | 3-Month U.S. Treasury Bill rate plus a specified spread | 02/16/2016 | $ | 73 | $ | 1 | $ | 1 | $ | 0 | |||||||||||||||||
|
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| |||||||||||||||||||||||||
Total Swap Agreements |
| $ | 1 | $ | 1 | $ | 0 | |||||||||||||||||||||||
|
|
|
|
|
|
(1) | Receive represents that the Fund receives payments for any positive return on the underlying reference. The Fund makes payments for any negative return on such underlying reference. Pay represents that the Fund receives payments for any negative return on the underlying reference. The Fund makes payments for any positive return on such underlying reference. |
FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER SUMMARY
The following is a summary by counterparty of the market value of OTC financial derivative instruments and collateral (received)/pledged as of December 31, 2015:
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||||||||||||||
Counterparty | Forward Foreign Currency Contracts | Purchased Options | Swap Agreements | Total Over the Counter | Forward Foreign Currency Contracts | Written Options | Swap Agreements | Total Over the Counter | Net Market Value of OTC Derivatives | Collateral (Received)/ Pledged | Net Exposure (2) | |||||||||||||||||||||||||||||||||||
CBK | $ | 0 | $ | 0 | $ | 1 | $ | 1 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1 | $ | 0 | $ | 1 | ||||||||||||||||||||||||
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(2) | Net Exposure represents the net receivable/(payable) that would be due from/to the counterparty in the event of default. Exposure from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same legal entity. See Note 6, Principal Risks, in the Notes to Financial Statements for more information regarding master netting arrangements. |
FAIR VALUE OF FINANCIAL DERIVATIVE INSTRUMENTS
The following is a summary of the fair valuation of the Fund’s derivative instruments categorized by risk exposure. See Note 6, Principal Risks, in the Notes to Financial Statements on risks of the Fund.
Fair Values of Financial Derivative Instruments on the Statements of Assets and Liabilities as of December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Financial Derivative Instruments - Assets | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Purchased Options | $ | 0 | $ | 0 | $ | 12 | $ | 0 | $ | 0 | $ | 12 | ||||||||||||
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| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | 1 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1 | ||||||||||||
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| |||||||||||||
$ | 1 | $ | 0 | $ | 12 | $ | 0 | $ | 0 | $ | 13 | |||||||||||||
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| |||||||||||||
Financial Derivative Instruments - Liabilities | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Written Options | $ | 0 | $ | 0 | $ | 5 | $ | 0 | $ | 0 | $ | 5 | ||||||||||||
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See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 39 |
Table of Contents
Schedule of Investments PIMCO RealPath™ Blend 2020 Fund (Cont.)
December 31, 2015 (Unaudited)
The Effect of Financial Derivative Instruments on the Statements of Operations for the Period Ended December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Net Realized (Loss) on Financial Derivative Instruments | ||||||||||||||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | (19 | ) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | (19 | ) | ||||||||||
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| |||||||||||||
Net Change in Unrealized Appreciation (Depreciation) on Financial Derivative Instruments |
| |||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Purchased Options | $ | 0 | $ | 0 | $ | (12 | ) | $ | 0 | $ | 0 | $ | (12 | ) | ||||||||||
Written Options | 0 | 0 | 7 | 0 | 0 | 7 | ||||||||||||||||||
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|
| |||||||||||||
$ | 0 | $ | 0 | $ | (5 | ) | $ | 0 | $ | 0 | $ | (5 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | (1 | ) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | (1 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | (1 | ) | $ | 0 | $ | (5 | ) | $ | 0 | $ | 0 | $ | (6 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
FAIR VALUE MEASUREMENTS
The following is a summary of the fair valuations according to the inputs used as of December 31, 2015 in valuing the Fund’s assets and liabilities:
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at | ||||||||||||
Investments in Securities, at Value |
| |||||||||||||||
Mutual Funds | $ | 1,207 | $ | 0 | $ | 0 | $ | 1,207 | ||||||||
Short-Term Instruments | ||||||||||||||||
U.S. Treasury Bills | 0 | 3 | 0 | 3 | ||||||||||||
$ | 1,207 | $ | 3 | $ | 0 | $ | 1,210 | |||||||||
Investments in Affiliates, at Value |
| |||||||||||||||
Mutual Funds | 1,751 | 0 | 0 | 1,751 | ||||||||||||
Total Investments | $ | 2,958 | $ | 3 | $ | 0 | $ | 2,961 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at | ||||||||||||
Financial Derivative Instruments - Assets |
| |||||||||||||||
Exchange-traded or centrally cleared | $ | 0 | $ | 12 | $ | 0 | $ | 12 | ||||||||
Over the counter | 0 | 1 | 0 | 1 | ||||||||||||
$ | 0 | $ | 13 | $ | 0 | $ | 13 | |||||||||
Financial Derivative Instruments - Liabilities |
| |||||||||||||||
Exchange-traded or centrally cleared | $ | 0 | $ | (5 | ) | $ | 0 | $ | (5 | ) | ||||||
Totals | $ | 2,958 | $ | 11 | $ | 0 | $ | 2,969 |
There were no significant transfers between Levels 1, 2, or 3 during the period ended December 31, 2015.
40 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
Schedule of Investments PIMCO RealPath™ Blend 2025 Fund
December 31, 2015 (Unaudited)
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN SECURITIES 62.6% | ||||||||||||
MUTUAL FUNDS 62.5% | ||||||||||||
Vanguard 500 Index Fund ‘Admiral’ | 3,413 | $ | 643 | |||||||||
Vanguard Developed Markets Index Fund ‘Admiral’ | 30,991 | 366 | ||||||||||
Vanguard Emerging Markets Stock Index Fund ‘Admiral’ | 13,327 | 364 | ||||||||||
Vanguard REIT Index Fund ‘Admiral’ | 2,529 | 286 | ||||||||||
Vanguard Small-Cap Index Fund ‘Admiral’ | 3,372 | 179 | ||||||||||
|
| |||||||||||
Total Mutual Funds (Cost $1,933) | 1,838 | |||||||||||
|
| |||||||||||
PRINCIPAL AMOUNT (000S) | ||||||||||||
SHORT-TERM INSTRUMENTS 0.1% | ||||||||||||
U.S. TREASURY BILLS 0.1% | ||||||||||||
0.204% due 01/14/2016 | $ | 3 | 3 | |||||||||
|
| |||||||||||
Total Short-Term Instruments (Cost $3) | 3 | |||||||||||
|
| |||||||||||
Total Investments in Securities (Cost $1,936) | 1,841 | |||||||||||
|
| |||||||||||
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN AFFILIATES 59.5% | ||||||||||||
MUTUAL FUNDS (a) 59.5% | ||||||||||||
PIMCO Emerging Local Bond Fund | 13,727 | $ | 91 | |||||||||
PIMCO Foreign Bond Fund (U.S. Dollar-Hedged) | 18,744 | 186 | ||||||||||
PIMCO High Yield Fund | 33,503 | 277 | ||||||||||
PIMCO Long Duration Total Return Fund | 25,980 | 278 | ||||||||||
PIMCO Real Return Asset Fund | 47,793 | 366 | ||||||||||
PIMCO Real Return Fund | 26,361 | 277 | ||||||||||
PIMCO Total Return Fund | 27,843 | 280 | ||||||||||
|
| |||||||||||
Total Mutual Funds (Cost $1,900) | 1,755 | |||||||||||
|
| |||||||||||
Total Investments in Affiliates (Cost $1,900) | 1,755 | |||||||||||
Total Investments 122.1% (Cost $3,836) | $ | 3,596 | ||||||||||
Financial Derivative (Cost or Premiums, net $15) | 8 | |||||||||||
Other Assets and Liabilities, net (22.4%) | (659 | ) | ||||||||||
|
| |||||||||||
Net Assets 100.0% | $ | 2,945 | ||||||||||
|
|
NOTES TO SCHEDULE OF INVESTMENTS (AMOUNTS IN THOUSANDS*, EXCEPT NUMBER OF CONTRACTS AND UNITS):
* | A zero balance may reflect actual amounts rounding to less than one thousand. |
(a) | Institutional Class Shares of each Fund. |
(b) FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED
PURCHASED OPTIONS:
OPTIONS ON INDICES
Description | Strike Value | Expiration Date | # of Contracts | Cost | Market Value | |||||||||||||||
Put - CBOE S&P 500 Index | 1,550.000 | 01/15/2016 | 2 | $ | 7 | $ | 0 | |||||||||||||
Put - CBOE S&P 500 Index | 1,750.000 | 03/18/2016 | 2 | 9 | 2 | |||||||||||||||
Put - CBOE S&P 500 Index | 1,850.000 | 06/17/2016 | 1 | 6 | 4 | |||||||||||||||
Put - CBOE S&P 500 Index | 1,600.000 | 09/16/2016 | 3 | 14 | 9 | |||||||||||||||
|
|
|
| |||||||||||||||||
$ | 36 | $ | 15 | |||||||||||||||||
|
|
|
| |||||||||||||||||
Total Purchased Options | $ | 36 | $ | 15 | ||||||||||||||||
|
|
|
|
WRITTEN OPTIONS:
OPTIONS ON INDICES
Description | Strike Value | Expiration Date | # of Contracts | Premiums (Received) | Market Value | |||||||||||||||
Put - CBOE S&P 500 Index | 1,400.000 | 01/15/2016 | 2 | $ | (4 | ) | $ | 0 | ||||||||||||
Put - CBOE S&P 500 Index | 1,600.000 | 03/18/2016 | 2 | (5 | ) | (1 | ) | |||||||||||||
Put - CBOE S&P 500 Index | 1,650.000 | 06/17/2016 | 1 | (3 | ) | (2 | ) | |||||||||||||
Put - CBOE S&P 500 Index | 1,450.000 | 09/16/2016 | 3 | (9 | ) | (5 | ) | |||||||||||||
|
|
|
| |||||||||||||||||
$ | (21 | ) | $ | (8 | ) | |||||||||||||||
|
|
|
| |||||||||||||||||
Total Written Options | $ | (21 | ) | $ | (8 | ) | ||||||||||||||
|
|
|
|
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 41 |
Table of Contents
Schedule of Investments PIMCO RealPath™ Blend 2025 Fund (Cont.)
FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED SUMMARY
The following is a summary of the market value and variation margin of Exchange-Traded or Centrally Cleared Financial Derivative Instruments as of December 31, 2015:
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||
Market Value | Variation Margin Asset | Total | Market Value | Variation Margin Liability | Total | |||||||||||||||||||||||||||||
Purchased Options | Futures | Swap Agreements | Written Options | Futures | Swap Agreements | |||||||||||||||||||||||||||||
Total Exchange-Traded or Centrally Cleared | $ | 15 | $ | 0 | $ | 0 | $ | 15 | $ | (8) | $ | 0 | $ | 0 | $ | (8) | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(c) FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER
TRANSACTIONS IN WRITTEN CALL AND PUT OPTIONS FOR THE PERIOD ENDED DECEMBER 31, 2015:
# of Contracts | Premiums | |||||||
Balance at Beginning of Period | 4 | $ | (10 | ) | ||||
Sales | 4 | (11 | ) | |||||
Closing Buys | 0 | 0 | ||||||
Expirations | 0 | 0 | ||||||
Exercised | 0 | 0 | ||||||
|
|
|
| |||||
Balance at End of Period | 8 | $ | (21 | ) | ||||
|
|
|
|
SWAP AGREEMENTS:
TOTAL RETURN SWAPS ON COMMODITY INDICES
Counterparty | Pay/Receive (1) | Underlying Reference | # of Units | Financing Rate | Maturity Date | Notional Amount | Unrealized Appreciation | Swap Agreements, at Value | ||||||||||||||||||||||||||
Asset | Liability | |||||||||||||||||||||||||||||||||
CBK | Receive | BCOMTR Index | 571 | 3-Month U.S. Treasury Bill rate plus a specified spread | 02/16/2016 | $ | 89 | $ | 1 | $ | 1 | $ | 0 | |||||||||||||||||||||
|
|
|
|
|
| |||||||||||||||||||||||||||||
Total Swap Agreements | $ | 1 | $ | 1 | $ | 0 | ||||||||||||||||||||||||||||
|
|
|
|
|
|
(1) | Receive represents that the Fund receives payments for any positive return on the underlying reference. The Fund makes payments for any negative return on such underlying reference. Pay represents that the Fund receives payments for any negative return on the underlying reference. The Fund makes payments for any positive return on such underlying reference. |
FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER SUMMARY
The following is a summary by counterparty of the market value of OTC financial derivative instruments and collateral (received)/pledged as of December 31, 2015:
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||||||||||||||
Counterparty | Forward Foreign Currency Contracts | Purchased Options | Swap Agreements | Total Over the Counter | Forward Foreign Currency Contracts | Written Options | Swap Agreements | Total Over the Counter | Net Market Value of OTC Derivatives | Collateral (Received)/ Pledged | Net Exposure (2) | |||||||||||||||||||||||||||||||||||
CBK | $ | 0 | $ | 0 | $ | 1 | $ | 1 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1 | $ | 0 | $ | 1 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2) | Net Exposure represents the net receivable/(payable) that would be due from/to the counterparty in the event of default. Exposure from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same legal entity. See Note 6, Principal Risks, in the Notes to Financial Statements for more information regarding master netting arrangements. |
FAIR VALUE OF FINANCIAL DERIVATIVE INSTRUMENTS
The following is a summary of the fair valuation of the Fund’s derivative instruments categorized by risk exposure. See Note 6, Principal Risks, in the Notes to Financial Statements on risks of the Fund.
Fair Values of Financial Derivative Instruments on the Statements of Assets and Liabilities as of December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Financial Derivative Instruments - Assets | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Purchased Options | $ | 0 | $ | 0 | $ | 15 | $ | 0 | $ | 0 | $ | 15 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | 1 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 1 | $ | 0 | $ | 15 | $ | 0 | $ | 0 | $ | 16 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Financial Derivative Instruments - Liabilities | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Written Options | $ | 0 | $ | 0 | $ | 8 | $ | 0 | $ | 0 | $ | 8 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
42 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
The Effect of Financial Derivative Instruments on the Statements of Operations for the Period Ended December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Net Realized (Loss) on Financial Derivative Instruments | ||||||||||||||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | (22 | ) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | (22 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Net Change in Unrealized Appreciation (Depreciation) on Financial Derivative Instruments |
| |||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Purchased Options | $ | 0 | $ | 0 | $ | (15 | ) | $ | 0 | $ | 0 | $ | (15 | ) | ||||||||||
Written Options | 0 | 0 | 10 | 0 | 0 | 10 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 0 | $ | 0 | $ | (5 | ) | $ | 0 | $ | 0 | $ | (5 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | (2 | ) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | (2 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | (2 | ) | $ | 0 | $ | (5 | ) | $ | 0 | $ | 0 | $ | (7 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
FAIR VALUE MEASUREMENTS
The following is a summary of the fair valuations according to the inputs used as of December 31, 2015 in valuing the Fund’s assets and liabilities:
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Investments in Securities, at Value |
| |||||||||||||||
Mutual Funds | $ | 1,838 | $ | 0 | $ | 0 | $ | 1,838 | ||||||||
Short-Term Instruments | ||||||||||||||||
U.S. Treasury Bills | 0 | 3 | 0 | 3 | ||||||||||||
$ | 1,838 | $ | 3 | $ | 0 | $ | 1,841 | |||||||||
Investments in Affiliates, at Value |
| |||||||||||||||
Mutual Funds | 1,755 | 0 | 0 | 1,755 | ||||||||||||
Total Investments | $ | 3,593 | $ | 3 | $ | 0 | $ | 3,596 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Financial Derivative Instruments - Assets |
| |||||||||||||||
Exchange-traded or centrally cleared | $ | 0 | $ | 15 | $ | 0 | $ | 15 | ||||||||
Over the counter | 0 | 1 | 0 | 1 | ||||||||||||
$ | 0 | $ | 16 | $ | 0 | $ | 16 | |||||||||
Financial Derivative Instruments - Liabilities |
| |||||||||||||||
Exchange-traded or centrally cleared | $ | 0 | $ | (8 | ) | $ | 0 | $ | (8 | ) | ||||||
Totals | $ | 3,593 | $ | 11 | $ | 0 | $ | 3,604 |
There were no significant transfers between Levels 1, 2, or 3 during the period ended December 31, 2015.
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 43 |
Table of Contents
Schedule of Investments PIMCO RealPath™ Blend 2030 Fund
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN SECURITIES 60.2% | ||||||||||||
MUTUAL FUNDS 60.1% | ||||||||||||
Vanguard 500 Index Fund ‘Admiral’ | 3,198 | $ | 603 | |||||||||
Vanguard Developed Markets Index Fund ‘Admiral’ | 31,792 | 376 | ||||||||||
Vanguard Emerging Markets Stock Index Fund ‘Admiral’ | 13,660 | 373 | ||||||||||
Vanguard REIT Index Fund ‘Admiral’ | 2,767 | 312 | ||||||||||
Vanguard Small-Cap Index Fund ‘Admiral’ | 2,765 | 147 | ||||||||||
|
| |||||||||||
Total Mutual Funds (Cost $1,908) | 1,811 | |||||||||||
|
| |||||||||||
PRINCIPAL (000S) | ||||||||||||
SHORT-TERM INSTRUMENTS 0.1% | ||||||||||||
U.S. TREASURY BILLS 0.1% | ||||||||||||
0.202% due 01/14/2016 | $ | 4 | 4 | |||||||||
|
| |||||||||||
Total Short-Term Instruments (Cost $4) | 4 | |||||||||||
|
| |||||||||||
Total Investments in Securities (Cost $1,912) | 1,815 | |||||||||||
|
| |||||||||||
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN AFFILIATES 37.5% | ||||||||||||
MUTUAL FUNDS (a) 37.5% | ||||||||||||
PIMCO Emerging Local Bond Fund | 22,511 | $ | 150 | |||||||||
PIMCO Foreign Bond Fund (U.S. Dollar-Hedged) | 7,685 | 76 | ||||||||||
PIMCO High Yield Fund | 27,471 | 227 | ||||||||||
PIMCO Long Duration Total Return Fund | 21,228 | 227 | ||||||||||
PIMCO Real Return Asset Fund | 39,189 | 300 | ||||||||||
PIMCO Real Return Fund | 7,239 | 76 | ||||||||||
PIMCO Total Return Fund | 7,668 | 77 | ||||||||||
|
| |||||||||||
Total Mutual Funds (Cost $1,255) | 1,133 | |||||||||||
|
| |||||||||||
Total Investments in Affiliates (Cost $1,255) | 1,133 | |||||||||||
Total Investments 97.7% (Cost $3,167) | $ | 2,948 | ||||||||||
Financial Derivative (Cost or Premiums, net $12) | 8 | |||||||||||
Other Assets and Liabilities, net 2.1% | 62 | |||||||||||
|
| |||||||||||
Net Assets 100.0% | $ | 3,018 | ||||||||||
|
|
NOTES TO SCHEDULE OF INVESTMENTS (AMOUNTS IN THOUSANDS*, EXCEPT NUMBER OF CONTRACTS AND UNITS):
* | A zero balance may reflect actual amounts rounding to less than one thousand. |
(a) | Institutional Class Shares of each Fund. |
(b) FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED
PURCHASED OPTIONS:
OPTIONS ON INDICES
Description | Strike Value | Expiration Date | # of Contracts | Cost | Market Value | |||||||||||||||
Put - CBOE S&P 500 Index | 1,550.000 | 01/15/2016 | 2 | $ | 8 | $ | 0 | |||||||||||||
Put - CBOE S&P 500 Index | 1,700.000 | 03/18/2016 | 2 | 7 | 2 | |||||||||||||||
Put - CBOE S&P 500 Index | 1,750.000 | 06/17/2016 | 2 | 8 | 6 | |||||||||||||||
Put - CBOE S&P 500 Index | 1,550.000 | 09/16/2016 | 2 | 8 | 5 | |||||||||||||||
|
|
|
| |||||||||||||||||
$ | 31 | $ | 13 | |||||||||||||||||
|
|
|
| |||||||||||||||||
Total Purchased Options |
| $ | 31 | $ | 13 | |||||||||||||||
|
|
|
|
WRITTEN OPTIONS:
OPTIONS ON INDICES
Description | Strike Value | Expiration Date | # of Contracts | Premiums (Received) | Market Value | |||||||||||||||
Put - CBOE S&P 500 Index | 1,450.000 | 01/15/2016 | 2 | $ | (6 | ) | $ | 0 | ||||||||||||
Put - CBOE S&P 500 Index | 1,550.000 | 03/18/2016 | 2 | (4 | ) | (1 | ) | |||||||||||||
Put - CBOE S&P 500 Index | 1,600.000 | 06/17/2016 | 2 | (5 | ) | (3 | ) | |||||||||||||
Put - CBOE S&P 500 Index | 1,350.000 | 09/16/2016 | 2 | (4 | ) | (2 | ) | |||||||||||||
|
|
|
| |||||||||||||||||
$ | (19 | ) | $ | (6 | ) | |||||||||||||||
|
|
|
| |||||||||||||||||
Total Written Options |
| $ | (19 | ) | $ | (6 | ) | |||||||||||||
|
|
|
|
44 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED SUMMARY
The following is a summary of the market value and variation margin of Exchange-Traded or Centrally Cleared Financial Derivative Instruments as of December 31, 2015:
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||
Market Value | Variation Margin Asset | Market Value | Variation Margin Liability | |||||||||||||||||||||||||||||||
Purchased Options | Futures | Swap Agreements | Total | Written Options | Futures | Swap Agreements | Total | |||||||||||||||||||||||||||
Total Exchange-Traded or Centrally Cleared | $ | 13 | $ | 0 | $ | 0 | $ | 13 | $ | (6 | ) | $ | 0 | $ | 0 | $ | (6) | |||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(c) FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER
TRANSACTIONS IN WRITTEN CALL AND PUT OPTIONS FOR THE PERIOD ENDED DECEMBER 31, 2015:
# of Contracts | Premiums | |||||||
Balance at Beginning of Period | 4 | $ | (10 | ) | ||||
Sales | 4 | (9 | ) | |||||
Closing Buys | 0 | 0 | ||||||
Expirations | 0 | 0 | ||||||
Exercised | 0 | 0 | ||||||
|
|
|
| |||||
Balance at End of Period | 8 | $ | (19 | ) | ||||
|
|
|
|
SWAP AGREEMENTS:
TOTAL RETURN SWAPS ON COMMODITY INDICES
Counterparty | Pay/Receive (1) | Underlying Reference | # of Units | Financing Rate | Maturity Date | Notional Amount | Unrealized Appreciation | Swap Agreements, at Value | ||||||||||||||||||||||
Asset | Liability | |||||||||||||||||||||||||||||
CBK | Receive | BCOMTR Index | 468 | 3-Month U.S. Treasury Bill rate plus a specified spread | 02/16/2016 | $ | 73 | $ | 1 | $ | 1 | $ | 0 | |||||||||||||||||
|
|
|
|
|
| |||||||||||||||||||||||||
Total Swap Agreements |
| $ | 1 | $ | 1 | $ | 0 | |||||||||||||||||||||||
|
|
|
|
|
|
(1) | Receive represents that the Fund receives payments for any positive return on the underlying reference. The Fund makes payments for any negative return on such underlying reference. Pay represents that the Fund receives payments for any negative return on the underlying reference. The Fund makes payments for any positive return on such underlying reference. |
FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER SUMMARY
The following is a summary by counterparty of the market value of OTC financial derivative instruments and collateral (received)/pledged as of December 31, 2015:
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||||||||||||||
Counterparty | Forward Foreign Currency Contracts | Purchased Options | Swap Agreements | Total Over the Counter | Forward Foreign Currency Contracts | Written Options | Swap Agreements | Total Over the Counter | Net Market Value of OTC Derivatives | Collateral (Received)/ Pledged | Net Exposure (2) | |||||||||||||||||||||||||||||||||||
CBK | $ | 0 | $ | 0 | $ | 1 | $ | 1 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1 | $ | 0 | $ | 1 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2) | Net Exposure represents the net receivable/(payable) that would be due from/to the counterparty in the event of default. Exposure from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same legal entity. See Note 6, Principal Risks, in the Notes to Financial Statements for more information regarding master netting arrangements. |
FAIR VALUE OF FINANCIAL DERIVATIVE INSTRUMENTS
The following is a summary of the fair valuation of the Fund’s derivative instruments categorized by risk exposure. See Note 6, Principal Risks, in the Notes to Financial Statements on risks of the Fund.
Fair Values of Financial Derivative Instruments on the Statements of Assets and Liabilities as of December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Financial Derivative Instruments - Assets | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Purchased Options | $ | 0 | $ | 0 | $ | 13 | $ | 0 | $ | 0 | $ | 13 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | 1 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 1 | $ | 0 | $ | 13 | $ | 0 | $ | 0 | $ | 14 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Financial Derivative Instruments - Liabilities | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Written Options | $ | 0 | $ | 0 | $ | 6 | $ | 0 | $ | 0 | $ | 6 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 45 |
Table of Contents
Schedule of Investments PIMCO RealPath™ Blend 2030 Fund (Cont.)
December 31, 2015 (Unaudited)
The Effect of Financial Derivative Instruments on the Statements of Operations for the Period Ended December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Net Realized (Loss) on Financial Derivative Instruments | ||||||||||||||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | (19 | ) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | (19 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Net Change in Unrealized Appreciation (Depreciation) on Financial Derivative Instruments |
| |||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Purchased Options | $ | 0 | $ | 0 | $ | (13 | ) | $ | 0 | $ | 0 | $ | (13 | ) | ||||||||||
Written Options | 0 | 0 | 8 | 0 | 0 | 8 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 0 | $ | 0 | $ | (5 | ) | $ | 0 | $ | 0 | $ | (5 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | (1 | ) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | (1 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | (1 | ) | $ | 0 | $ | (5 | ) | $ | 0 | $ | 0 | $ | (6 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
FAIR VALUE MEASUREMENTS
The following is a summary of the fair valuations according to the inputs used as of December 31, 2015 in valuing the Fund’s assets and liabilities:
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Investments in Securities, at Value | ||||||||||||||||
Mutual Funds | $ | 1,811 | $ | 0 | $ | 0 | $ | 1,811 | ||||||||
Short-Term Instruments | ||||||||||||||||
U.S. Treasury Bills | 0 | 4 | 0 | 4 | ||||||||||||
$ | 1,811 | $ | 4 | $ | 0 | $ | 1,815 | |||||||||
Investments in Affiliates, at Value | ||||||||||||||||
Mutual Funds | 1,133 | 0 | 0 | 1,133 | ||||||||||||
Total Investments | $ | 2,944 | $ | 4 | $ | 0 | $ | 2,948 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Financial Derivative Instruments - Assets | ||||||||||||||||
Exchange-traded or centrally cleared | $ | 0 | $ | 13 | $ | 0 | $ | 13 | ||||||||
Over the counter | 0 | 1 | 0 | 1 | ||||||||||||
$ | 0 | $ | 14 | $ | 0 | $ | 14 | |||||||||
Financial Derivative Instruments - Liabilities | ||||||||||||||||
Exchange-traded or centrally cleared | $ | 0 | $ | (6 | ) | $ | 0 | $ | (6 | ) | ||||||
Totals | $ | 2,944 | $ | 12 | $ | 0 | $ | 2,956 |
There were no significant transfers between Levels 1, 2, or 3 during the period ended December 31, 2015.
46 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
Schedule of Investments PIMCO RealPath™ Blend 2035 Fund
December 31, 2015 (Unaudited)
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN SECURITIES 70.4% | ||||||||||||
MUTUAL FUNDS 70.3% | ||||||||||||
Vanguard 500 Index Fund ‘Admiral’ | 3,981 | $ | 750 | |||||||||
Vanguard Developed Markets Index Fund ‘Admiral’ | 42,232 | 499 | ||||||||||
Vanguard Emerging Markets Stock Index Fund ‘Admiral’ | 18,136 | 496 | ||||||||||
Vanguard REIT Index Fund ‘Admiral’ | 3,053 | 345 | ||||||||||
Vanguard Small-Cap Index Fund ‘Admiral’ | 4,589 | 243 | ||||||||||
|
| |||||||||||
Total Mutual Funds (Cost $2,467) | 2,333 | |||||||||||
|
| |||||||||||
PRINCIPAL AMOUNT (000S) | ||||||||||||
SHORT-TERM INSTRUMENTS 0.1% | ||||||||||||
U.S. TREASURY BILLS 0.1% | ||||||||||||
0.202% due 01/14/2016 | $ | 4 | 4 | |||||||||
|
| |||||||||||
Total Short-Term Instruments (Cost $4) | 4 | |||||||||||
|
| |||||||||||
Total Investments in Securities (Cost $2,471) | 2,337 | |||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN AFFILIATES 27.6% | ||||||||||||
MUTUAL FUNDS (a) 27.6% | ||||||||||||
PIMCO Emerging Local Bond Fund | 24,906 | $ | 166 | |||||||||
PIMCO High Yield Fund | 20,262 | 167 | ||||||||||
PIMCO Long Duration Total Return Fund | 23,486 | 251 | ||||||||||
PIMCO Real Return Asset Fund | 43,358 | 332 | ||||||||||
|
| |||||||||||
Total Mutual Funds (Cost $1,025) | 916 | |||||||||||
|
| |||||||||||
Total Investments in Affiliates (Cost $1,025) | 916 | |||||||||||
Total Investments 98.0% (Cost $3,496) | $ | 3,253 | ||||||||||
Financial Derivative (Cost or Premiums, net $13) | 7 | |||||||||||
Other Assets and Liabilities, net 1.8% | 60 | |||||||||||
|
| |||||||||||
Net Assets 100.0% | $ | 3,320 | ||||||||||
|
|
NOTES TO SCHEDULE OF INVESTMENTS (AMOUNTS IN THOUSANDS*, EXCEPT NUMBER OF CONTRACTS AND UNITS):
* | A zero balance may reflect actual amounts rounding to less than one thousand. |
(a) | Institutional Class Shares of each Fund. |
(b) FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED
PURCHASED OPTIONS:
OPTIONS ON INDICES
Description | Strike Value | Expiration Date | # of Contracts | Cost | Market Value | |||||||||||||||
Put - CBOE S&P 500 Index | 1,550.000 | 01/15/2016 | 2 | $ | 8 | $ | 0 | |||||||||||||
Put - CBOE S&P 500 Index | 1,700.000 | 03/18/2016 | 2 | 7 | 2 | |||||||||||||||
Put - CBOE S&P 500 Index | 1,700.000 | 06/17/2016 | 3 | 10 | 7 | |||||||||||||||
Put - CBOE S&P 500 Index | 1,650.000 | 09/16/2016 | 3 | 17 | 10 | |||||||||||||||
|
|
|
| |||||||||||||||||
$ | 42 | $ | 19 | |||||||||||||||||
|
|
|
| |||||||||||||||||
Total Purchased Options |
| $ | 42 | $ | 19 | |||||||||||||||
|
|
|
|
WRITTEN OPTIONS:
OPTIONS ON INDICES
Description | Strike Value | Expiration Date | # of Contracts | Premiums (Received) | Market Value | |||||||||||||||
Put - CBOE S&P 500 Index | 1,450.000 | 01/15/2016 | 2 | $ | (6 | ) | $ | 0 | ||||||||||||
Put - CBOE S&P 500 Index | 1,550.000 | 03/18/2016 | 2 | (4 | ) | (1 | ) | |||||||||||||
Put - CBOE S&P 500 Index | 1,600.000 | 06/17/2016 | 3 | (7 | ) | (5 | ) | |||||||||||||
Put - CBOE S&P 500 Index | 1,550.000 | 09/16/2016 | 3 | (12 | ) | (7 | ) | |||||||||||||
|
|
|
| |||||||||||||||||
$ | (29 | ) | $ | (13 | ) | |||||||||||||||
|
|
|
| |||||||||||||||||
Total Written Options |
| $ | (29 | ) | $ | (13 | ) | |||||||||||||
|
|
|
|
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 47 |
Table of Contents
Schedule of Investments PIMCO RealPath™ Blend 2035 Fund (Cont.)
FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED SUMMARY
The following is a summary of the market value and variation margin of Exchange-Traded or Centrally Cleared Financial Derivative Instruments as of December 31, 2015:
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||
Market Value | Variation Margin Asset | Market Value | Variation Margin Liability | |||||||||||||||||||||||||||||||
Purchased Options | Futures | Swap Agreements | Total | Written Options | Futures | Swap Agreements | Total | |||||||||||||||||||||||||||
Total Exchange-Traded or Centrally Cleared | $ | 19 | $ | 0 | $ | 0 | $ | 19 | $ | (13 | ) | $ | 0 | $ | 0 | $ | (13 | ) | ||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(c) FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER
TRANSACTIONS IN WRITTEN CALL AND PUT OPTIONS FOR THE PERIOD ENDED DECEMBER 31, 2015:
# of Contracts | Premiums | |||||||
Balance at Beginning of Period | 4 | $ | (10 | ) | ||||
Sales | 6 | (19 | ) | |||||
Closing Buys | 0 | 0 | ||||||
Expirations | 0 | 0 | ||||||
Exercised | 0 | 0 | ||||||
|
|
|
| |||||
Balance at End of Period | 10 | $ | (29 | ) | ||||
|
|
|
|
SWAP AGREEMENTS:
TOTAL RETURN SWAPS ON COMMODITY INDICES
Maturity Date | Notional Amount | Unrealized Appreciation | Swap Agreements, at Value | |||||||||||||||||||||||||||||||
Counterparty | Pay/Receive (1) | Underlying Reference | # of Units | Financing Rate | Asset | Liability | ||||||||||||||||||||||||||||
CBK | Receive | BCOMTR Index | 518 | 3-Month U.S. Treasury Bill rate plus a specified spread | 02/16/2016 | $ | 81 | $ | 1 | $ | 1 | $ | 0 | |||||||||||||||||||||
|
|
|
|
|
| |||||||||||||||||||||||||||||
Total Swap Agreements | $ | 1 | $ | 1 | $ | 0 | ||||||||||||||||||||||||||||
|
|
|
|
|
|
(1) | Receive represents that the Fund receives payments for any positive return on the underlying reference. The Fund makes payments for any negative return on such underlying reference. Pay represents that the Fund receives payments for any negative return on the underlying reference. The Fund makes payments for any positive return on such underlying reference. |
FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER SUMMARY
The following is a summary by counterparty of the market value of OTC financial derivative instruments and collateral (received)/pledged as of December 31, 2015:
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||||||||||||||
Counterparty | Forward Foreign Currency Contracts | Purchased Options | Swap Agreements | Total Over the Counter | Forward Foreign Currency Contracts | Written Options | Swap Agreements | Total Over the Counter | Net Market Value of OTC Derivatives | Collateral (Received)/ Pledged | Net Exposure (2) | |||||||||||||||||||||||||||||||||||
CBK | $ | 0 | $ | 0 | $ | 1 | $ | 1 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1 | $ | 0 | $ | 1 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2) | Net Exposure represents the net receivable/(payable) that would be due from/to the counterparty in the event of default. Exposure from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same legal entity. See Note 6, Principal Risks, in the Notes to Financial Statements for more information regarding master netting arrangements. |
FAIR VALUE OF FINANCIAL DERIVATIVE INSTRUMENTS
The following is a summary of the fair valuation of the Fund’s derivative instruments categorized by risk exposure. See Note 6, Principal Risks, in the Notes to Financial Statements on risks of the Fund.
Fair Values of Financial Derivative Instruments on the Statements of Assets and Liabilities as of December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Financial Derivative Instruments - Assets | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Purchased Options | $ | 0 | $ | 0 | $ | 19 | $ | 0 | $ | 0 | $ | 19 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | 1 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 1 | $ | 0 | $ | 19 | $ | 0 | $ | 0 | $ | 20 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Financial Derivative Instruments - Liabilities | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Written Options | $ | 0 | $ | 0 | $ | 13 | $ | 0 | $ | 0 | $ | 13 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
48 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
The Effect of Financial Derivative Instruments on the Statements of Operations for the Period Ended December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Net Realized (Loss) on Financial Derivative Instruments | ||||||||||||||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | (20 | ) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | (20 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Net Change in Unrealized Appreciation (Depreciation) on Financial Derivative Instruments |
| |||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Purchased Options | $ | 0 | $ | 0 | $ | (17 | ) | $ | 0 | $ | 0 | $ | (17 | ) | ||||||||||
Written Options | 0 | 0 | 12 | 0 | 0 | 12 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 0 | $ | 0 | $ | (5 | ) | $ | 0 | $ | 0 | $ | (5 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | (1 | ) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | (1 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | (1 | ) | $ | 0 | $ | (5 | ) | $ | 0 | $ | 0 | $ | (6 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
FAIR VALUE MEASUREMENTS
The following is a summary of the fair valuations according to the inputs used as of December 31, 2015 in valuing the Fund’s assets and liabilities:
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at | ||||||||||||
Investments in Securities, at Value |
| |||||||||||||||
Mutual Funds | $ | 2,333 | $ | 0 | $ | 0 | $ | 2,333 | ||||||||
Short-Term Instruments | ||||||||||||||||
U.S. Treasury Bills | 0 | 4 | 0 | 4 | ||||||||||||
$ | 2,333 | $ | 4 | $ | 0 | $ | 2,337 | |||||||||
Investments in Affiliates, at Value | ||||||||||||||||
Mutual Funds | 916 | 0 | 0 | 916 | ||||||||||||
Total Investments | $ | 3,249 | $ | 4 | $ | 0 | $ | 3,253 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at | ||||||||||||
Financial Derivative Instruments - Assets | ||||||||||||||||
Exchange-traded or centrally cleared | $ | 0 | $ | 19 | $ | 0 | $ | 19 | ||||||||
Over the counter | 0 | 1 | 0 | 1 | ||||||||||||
|
|
|
|
|
|
|
| |||||||||
$ | 0 | $ | 20 | $ | 0 | $ | 20 | |||||||||
Financial Derivative Instruments - Liabilities | ||||||||||||||||
Exchange-traded or centrally cleared | $ | 0 | $ | (13 | ) | $ | 0 | $ | (13 | ) | ||||||
|
|
|
|
|
|
|
| |||||||||
Totals | $ | 3,249 | $ | 11 | $ | 0 | $ | 3,260 |
There were no significant transfers between Levels 1, 2, or 3 during the period ended December 31, 2015.
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 49 |
Table of Contents
Schedule of Investments PIMCO RealPath™ Blend 2040 Fund
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN SECURITIES 75.1% | ||||||||||||
MUTUAL FUNDS 75.0% | ||||||||||||
Vanguard 500 Index Fund ‘Admiral’ | 3,930 | $ | 741 | |||||||||
Vanguard Developed Markets Index Fund ‘Admiral’ | 37,483 | 443 | ||||||||||
Vanguard Emerging Markets Stock Index Fund ‘Admiral’ | 16,115 | 440 | ||||||||||
Vanguard REIT Index Fund ‘Admiral’ | 2,718 | 307 | ||||||||||
Vanguard Small-Cap Index Fund ‘Admiral’ | 5,437 | 288 | ||||||||||
|
| |||||||||||
Total Mutual Funds (Cost $2,340) | 2,219 | |||||||||||
|
| |||||||||||
PRINCIPAL AMOUNT (000S) | ||||||||||||
SHORT-TERM INSTRUMENTS 0.1% | ||||||||||||
U.S. TREASURY BILLS 0.1% | ||||||||||||
0.192% due 01/14/2016 | $ | 4 | 4 | |||||||||
|
| |||||||||||
Total Short-Term Instruments (Cost $4) | 4 | |||||||||||
|
| |||||||||||
Total Investments in Securities (Cost $2,344) | 2,223 | |||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN AFFILIATES 22.6% | ||||||||||||
MUTUAL FUNDS (a) 22.6% | ||||||||||||
PIMCO Emerging Local Bond Fund | 10,928 | $ | 73 | |||||||||
PIMCO High Yield Fund | 18,006 | 149 | ||||||||||
PIMCO Long Duration Total Return Fund | 20,949 | 224 | ||||||||||
PIMCO Real Return Asset Fund | 28,897 | 221 | ||||||||||
|
| |||||||||||
Total Mutual Funds (Cost $743) | 667 | |||||||||||
|
| |||||||||||
Total Investments in Affiliates (Cost $743) | 667 | |||||||||||
Total Investments 97.7% (Cost $3,087) | $ | 2,890 | ||||||||||
Financial Derivative (Cost or Premiums, net $11) | 7 | |||||||||||
Other Assets and Liabilities, net 2.1% | 62 | |||||||||||
|
| |||||||||||
Net Assets 100.0% | $ | 2,959 | ||||||||||
|
|
NOTES TO SCHEDULE OF INVESTMENTS (AMOUNTS IN THOUSANDS*, EXCEPT NUMBER OF CONTRACTS AND UNITS):
* | A zero balance may reflect actual amounts rounding to less than one thousand. |
(a) | Institutional Class Shares of each Fund. |
(b) FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED
PURCHASED OPTIONS:
OPTIONS ON INDICES
Description | Strike Value | Expiration Date | # of Contracts | Cost | Market Value | |||||||||||||||
Put - CBOE S&P 500 Index | 1,500.000 | 01/15/2016 | 2 | $ | 7 | $ | 0 | |||||||||||||
Put - CBOE S&P 500 Index | 1,650.000 | 03/18/2016 | 3 | 9 | 2 | |||||||||||||||
Put - CBOE S&P 500 Index | 1,700.000 | 06/17/2016 | 3 | 10 | 7 | |||||||||||||||
Put - CBOE S&P 500 Index | 1,600.000 | 09/16/2016 | 2 | 10 | 6 | |||||||||||||||
|
|
|
| |||||||||||||||||
$ | 36 | $ | 15 | |||||||||||||||||
|
|
|
| |||||||||||||||||
Total Purchased Options |
| $ | 36 | $ | 15 | |||||||||||||||
|
|
|
|
WRITTEN OPTIONS:
OPTIONS ON INDICES
Description | Strike Value | Expiration Date | # of Contracts | Premiums (Received) | Market Value | |||||||||||||||
Put - CBOE S&P 500 Index | 1,400.000 | 01/15/2016 | 2 | $ | (5 | ) | $ | 0 | ||||||||||||
Put - CBOE S&P 500 Index | 1,550.000 | 03/18/2016 | 3 | (7 | ) | (1 | ) | |||||||||||||
Put - CBOE S&P 500 Index | 1,600.000 | 06/17/2016 | 3 | (7 | ) | (5 | ) | |||||||||||||
Put - CBOE S&P 500 Index | 1,450.000 | 09/16/2016 | 2 | (6 | ) | (3 | ) | |||||||||||||
|
|
|
| |||||||||||||||||
$ | (25 | ) | $ | (9 | ) | |||||||||||||||
|
|
|
| |||||||||||||||||
Total Written Options |
| $ | (25 | ) | $ | (9 | ) | |||||||||||||
|
|
|
|
FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED SUMMARY
The following is a summary of the market value and variation margin of Exchange-Traded or Centrally Cleared Financial Derivative Instruments as of December 31, 2015:
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||
Market Value | Variation Margin Asset | Market Value | Variation Margin Liability | |||||||||||||||||||||||||||||||
Purchased Options | Futures | Swap Agreements | Total | Written Options | Futures | Swap Agreements | Total | |||||||||||||||||||||||||||
Total Exchange-Traded or Centrally Cleared | $ | 15 | $ | 0 | $ | 0 | $ | 15 | $ | (9 | ) | $ | 0 | $ | 0 | $ | (9 | ) | ||||||||||||||||
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|
50 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
(c) FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER
TRANSACTIONS IN WRITTEN CALL AND PUT OPTIONS FOR THE PERIOD ENDED DECEMBER 31, 2015:
# of Contracts | Premiums | |||||||
Balance at Beginning of Period | 5 | $ | (11 | ) | ||||
Sales | 5 | (14 | ) | |||||
Closing Buys | 0 | 0 | ||||||
Expirations | 0 | 0 | ||||||
Exercised | 0 | 0 | ||||||
|
|
|
| |||||
Balance at End of Period | 10 | $ | (25 | ) | ||||
|
|
|
|
SWAP AGREEMENTS:
TOTAL RETURN SWAPS ON COMMODITY INDICES
Counterparty | Pay/Receive (1) | Underlying Reference | # of Units | Financing Rate | Maturity Date | Notional Amount | Unrealized Appreciation | Swap Agreements, at Value | ||||||||||||||||||||||
Asset | Liability | |||||||||||||||||||||||||||||
CBK | Receive | BCOMTR Index | 460 | 3-Month U.S. Treasury Bill rate plus a specified spread | 02/16/2016 | $ | 72 | $ | 1 | $ | 1 | $ | 0 | |||||||||||||||||
|
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| |||||||||||||||||||||||||
Total Swap Agreements | $ | 1 | $ | 1 | $ | 0 | ||||||||||||||||||||||||
|
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|
|
(1) | Receive represents that the Fund receives payments for any positive return on the underlying reference. The Fund makes payments for any negative return on such underlying reference. Pay represents that the Fund receives payments for any negative return on the underlying reference. The Fund makes payments for any positive return on such underlying reference. |
FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER SUMMARY
The following is a summary by counterparty of the market value of OTC financial derivative instruments and collateral (received)/pledged as of December 31, 2015:
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||||||||||||||
Counterparty | Forward Foreign Currency Contracts | Purchased Options | Swap Agreements | Total Over the Counter | Forward Foreign Currency Contracts | Written Options | Swap Agreements | Total Over the Counter | Net Market Value of OTC Derivatives | Collateral (Received)/ Pledged | Net Exposure (2) | |||||||||||||||||||||||||||||||||||
CBK | $ | 0 | $ | 0 | $ | 1 | $ | 1 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1 | $ | 0 | $ | 1 | ||||||||||||||||||||||||
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(2) | Net Exposure represents the net receivable/(payable) that would be due from/to the counterparty in the event of default. Exposure from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same legal entity. See Note 6, Principal Risks, in the Notes to Financial Statements for more information regarding master netting arrangements. |
FAIR VALUE OF FINANCIAL DERIVATIVE INSTRUMENTS
The following is a summary of the fair valuation of the Fund’s derivative instruments categorized by risk exposure. See Note 6, Principal Risks, in the Notes to Financial Statements on risks of the Fund.
Fair Values of Financial Derivative Instruments on the Statements of Assets and Liabilities as of December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Financial Derivative Instruments - Assets | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Purchased Options | $ | 0 | $ | 0 | $ | 15 | $ | 0 | $ | 0 | $ | 15 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | 1 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1 | ||||||||||||
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|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 1 | $ | 0 | $ | 15 | $ | 0 | $ | 0 | $ | 16 | |||||||||||||
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| |||||||||||||
Financial Derivative Instruments - Liabilities | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Written Options | $ | 0 | $ | 0 | $ | 9 | $ | 0 | $ | 0 | $ | 9 | ||||||||||||
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See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 51 |
Table of Contents
Schedule of Investments PIMCO RealPath™ Blend 2040 Fund (Cont.)
December 31, 2015 (Unaudited)
The Effect of Financial Derivative Instruments on the Statements of Operations for the Period Ended December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Net Realized (Loss) on Financial Derivative Instruments | ||||||||||||||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | (19 | ) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | (19 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Net Change in Unrealized Appreciation (Depreciation) on Financial Derivative Instruments |
| |||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Purchased Options | $ | 0 | $ | 0 | $ | (15 | ) | $ | 0 | $ | 0 | $ | (15 | ) | ||||||||||
Written Options | 0 | 0 | 10 | 0 | 0 | 10 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 0 | $ | 0 | $ | (5 | ) | $ | 0 | $ | 0 | $ | (5 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | (1 | ) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | (1 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | (1 | ) | $ | 0 | $ | (5 | ) | $ | 0 | $ | 0 | $ | (6 | ) | ||||||||||
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|
|
|
|
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|
|
FAIR VALUE MEASUREMENTS
The following is a summary of the fair valuations according to the inputs used as of December 31, 2015 in valuing the Fund’s assets and liabilities:
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Investments in Securities, at Value |
| |||||||||||||||
Mutual Funds | $ | 2,219 | $ | 0 | $ | 0 | $ | 2,219 | ||||||||
Short-Term Instruments | ||||||||||||||||
U.S. Treasury Bills | 0 | 4 | 0 | 4 | ||||||||||||
$ | 2,219 | $ | 4 | $ | 0 | $ | 2,223 | |||||||||
Investments in Affiliates, at Value |
| |||||||||||||||
Mutual Funds | 667 | 0 | 0 | 667 | ||||||||||||
Total Investments | $ | 2,886 | $ | 4 | $ | 0 | $ | 2,890 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Financial Derivative Instruments - Assets |
| |||||||||||||||
Exchange-traded or centrally cleared | $ | 0 | $ | 15 | $ | 0 | $ | 15 | ||||||||
Over the counter | 0 | 1 | 0 | 1 | ||||||||||||
$ | 0 | $ | 16 | $ | 0 | $ | 16 | |||||||||
Financial Derivative Instruments - Liabilities |
| |||||||||||||||
Exchange-traded or centrally cleared | $ | 0 | $ | (9 | ) | $ | 0 | $ | (9 | ) | ||||||
Totals | $ | 2,886 | $ | 11 | $ | 0 | $ | 2,897 |
There were no significant transfers between Levels 1, 2, or 3 during the period ended December 31, 2015.
52 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
Schedule of Investments PIMCO RealPath™ Blend 2045 Fund
December 31, 2015 (Unaudited)
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN SECURITIES 80.2% | ||||||||||||
MUTUAL FUNDS 80.1% | ||||||||||||
Vanguard 500 Index Fund ‘Admiral’ | 3,991 | $ | 752 | |||||||||
Vanguard Developed Markets Index Fund ‘Admiral’ | 44,412 | 525 | ||||||||||
Vanguard Emerging Markets Stock Index Fund ‘Admiral’ | 19,090 | 522 | ||||||||||
Vanguard REIT Index Fund ‘Admiral’ | 2,761 | 312 | ||||||||||
Vanguard Small-Cap Index Fund ‘Admiral’ | 5,521 | 293 | ||||||||||
|
| |||||||||||
Total Mutual Funds (Cost $2,546) | 2,404 | |||||||||||
|
| |||||||||||
PRINCIPAL (000S) | ||||||||||||
SHORT-TERM INSTRUMENTS 0.1% | ||||||||||||
U.S. TREASURY BILLS 0.1% | ||||||||||||
0.202% due 01/14/2016 | $ | 4 | 4 | |||||||||
|
| |||||||||||
Total Short-Term Instruments (Cost $4) | 4 | |||||||||||
|
| |||||||||||
Total Investments in Securities (Cost $2,550) | 2,408 | |||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN AFFILIATES 17.5% | ||||||||||||
MUTUAL FUNDS (a) 17.5% | ||||||||||||
PIMCO Emerging Local Bond Fund | 11,099 | $ | 74 | |||||||||
PIMCO High Yield Fund | 9,032 | 75 | ||||||||||
PIMCO Long Duration Total Return Fund | 21,276 | 227 | ||||||||||
PIMCO Real Return Asset Fund | 19,658 | 150 | ||||||||||
|
| |||||||||||
Total Mutual Funds (Cost $590) | 526 | |||||||||||
|
| |||||||||||
Total Investments in Affiliates (Cost $590) | 526 | |||||||||||
Total Investments 97.7% (Cost $3,140) | $ | 2,934 | ||||||||||
Financial Derivative (Cost or Premiums, net $12) | 7 | |||||||||||
Other Assets and Liabilities, net 2.1% | 63 | |||||||||||
|
| |||||||||||
Net Assets 100.0% | $ | 3,004 | ||||||||||
|
|
NOTES TO SCHEDULE OF INVESTMENTS (AMOUNTS IN THOUSANDS*, EXCEPT NUMBER OF CONTRACTS AND UNITS):
* | A zero balance may reflect actual amounts rounding to less than one thousand. |
(a) | Institutional Class Shares of each Fund. |
(b) FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED
PURCHASED OPTIONS:
OPTIONS ON INDICES
Description | Strike Value | Expiration Date | # of Contracts | Cost | Market Value | |||||||||||||||
Put - CBOE S&P 500 Index | 1,500.000 | 01/15/2016 | 3 | $ | 10 | $ | 0 | |||||||||||||
Put - CBOE S&P 500 Index | 1,650.000 | 03/18/2016 | 3 | 9 | 2 | |||||||||||||||
Put - CBOE S&P 500 Index | 1,700.000 | 06/17/2016 | 3 | 10 | 7 | |||||||||||||||
Put - CBOE S&P 500 Index | 1,600.000 | 09/16/2016 | 2 | 10 | 6 | |||||||||||||||
|
|
|
| |||||||||||||||||
$ | 39 | $ | 15 | |||||||||||||||||
|
|
|
| |||||||||||||||||
Total Purchased Options |
| $ | 39 | $ | 15 | |||||||||||||||
|
|
|
|
WRITTEN OPTIONS:
OPTIONS ON INDICES
Description | Strike Value | Expiration Date | # of Contracts | Premiums (Received) | Market Value | |||||||||||||||
Put - CBOE S&P 500 Index | 1,400.000 | 01/15/2016 | 3 | $ | (7 | ) | $ | 0 | ||||||||||||
Put - CBOE S&P 500 Index | 1,550.000 | 03/18/2016 | 3 | (7 | ) | (1 | ) | |||||||||||||
Put - CBOE S&P 500 Index | 1,600.000 | 06/17/2016 | 3 | (7 | ) | (5 | ) | |||||||||||||
Put - CBOE S&P 500 Index | 1,450.000 | 09/16/2016 | 2 | (6 | ) | (3 | ) | |||||||||||||
|
|
|
| |||||||||||||||||
$ | (27 | ) | $ | (9 | ) | |||||||||||||||
|
|
|
| |||||||||||||||||
Total Written Options | $ | (27 | ) | $ | (9 | ) | ||||||||||||||
|
|
|
|
FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED SUMMARY
The following is a summary of the market value and variation margin of Exchange-Traded or Centrally Cleared Financial Derivative Instruments as of December 31, 2015:
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||
Market Value | Variation Margin Asset | Market Value | Variation Margin Liability | |||||||||||||||||||||||||||||||
Purchased Options | Futures | Swap Agreements | Total | Written Options | Futures | Swap Agreements | Total | |||||||||||||||||||||||||||
Total Exchange-Traded or Centrally Cleared | $ | 15 | $ | 0 | $ | 0 | $ | 15 | $ | (9) | $ | 0 | $ | 0 | $ | (9) | ||||||||||||||||||
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|
|
|
|
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 53 |
Table of Contents
Schedule of Investments PIMCO RealPath™ Blend 2045 Fund (Cont.)
(c) FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER
TRANSACTIONS IN WRITTEN CALL AND PUT OPTIONS FOR THE PERIOD ENDED DECEMBER 31, 2015:
# of Contracts | Premiums | |||||||
Balance at Beginning of Period | 6 | $ | (14 | ) | ||||
Sales | 5 | (13 | ) | |||||
Closing Buys | 0 | 0 | ||||||
Expirations | 0 | 0 | ||||||
Exercised | 0 | 0 | ||||||
|
|
|
| |||||
Balance at End of Period | 11 | $ | (27 | ) | ||||
|
|
|
|
SWAP AGREEMENTS:
TOTAL RETURN SWAPS ON COMMODITY INDICES
Counterparty | Pay/Receive (1) | Underlying Reference | # of Units | Financing Rate | Maturity Date | Notional Amount | Unrealized Appreciation | Swap Agreements, at Value | ||||||||||||||||||||||
Asset | Liability | |||||||||||||||||||||||||||||
CBK | Receive | BCOMTR Index | 468 | 3-Month U.S. Treasury Bill rate plus a | 02/16/2016 | $ | 73 | $ | 1 | $ | 1 | $ | 0 | |||||||||||||||||
|
|
|
|
|
| |||||||||||||||||||||||||
Total Swap Agreements | $ | 1 | $ | 1 | $ | 0 | ||||||||||||||||||||||||
|
|
|
|
|
|
(1) | Receive represents that the Fund receives payments for any positive return on the underlying reference. The Fund makes payments for any negative return on such underlying reference. Pay represents that the Fund receives payments for any negative return on the underlying reference. The Fund makes payments for any positive return on such underlying reference. |
FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER SUMMARY
The following is a summary by counterparty of the market value of OTC financial derivative instruments and collateral (received)/pledged as of December 31, 2015:
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||||||||||||||
Counterparty | Forward Foreign Currency Contracts | Purchased Options | Swap Agreements | Total Over the Counter | Forward Foreign Currency Contracts | Written Options | Swap Agreements | Total Over the Counter | Net Market Value of OTC Derivatives | Collateral (Received)/ Pledged | Net Exposure (2) | |||||||||||||||||||||||||||||||||||
CBK | $ | 0 | $ | 0 | $ | 1 | $ | 1 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1 | $ | 0 | $ | 1 | ||||||||||||||||||||||||
|
|
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|
|
|
|
|
|
|
(2) | Net Exposure represents the net receivable/(payable) that would be due from/to the counterparty in the event of default. Exposure from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same legal entity. See Note 6, Principal Risks, in the Notes to Financial Statements for more information regarding master netting arrangements. |
FAIR VALUE OF FINANCIAL DERIVATIVE INSTRUMENTS
The following is a summary of the fair valuation of the Fund’s derivative instruments categorized by risk exposure. See Note 6, Principal Risks, in the Notes to Financial Statements on risks of the Fund.
Fair Values of Financial Derivative Instruments on the Statements of Assets and Liabilities as of December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Financial Derivative Instruments - Assets | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Purchased Options | $ | 0 | $ | 0 | $ | 15 | $ | 0 | $ | 0 | $ | 15 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | 1 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 1 | $ | 0 | $ | 15 | $ | 0 | $ | 0 | $ | 16 | |||||||||||||
|
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|
|
|
|
|
|
|
|
|
| |||||||||||||
Financial Derivative Instruments - Liabilities | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Written Options | $ | 0 | $ | 0 | $ | 9 | $ | 0 | $ | 0 | $ | 9 | ||||||||||||
|
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|
|
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|
|
54 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
The Effect of Financial Derivative Instruments on the Statements of Operations for the Period Ended December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Net Realized (Loss) on Financial Derivative Instruments | ||||||||||||||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | (19 | ) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | (19 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Net Change in Unrealized Appreciation (Depreciation) on Financial Derivative Instruments |
| |||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Purchased Options | $ | 0 | $ | 0 | $ | (15 | ) | $ | 0 | $ | 0 | $ | (15 | ) | ||||||||||
Written Options | 0 | 0 | 11 | 0 | 0 | 11 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 0 | $ | 0 | $ | (4 | ) | $ | 0 | $ | 0 | $ | (4 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | (1 | ) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | (1 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | (1 | ) | $ | 0 | $ | (4 | ) | $ | 0 | $ | 0 | $ | (5 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
FAIR VALUE MEASUREMENTS
The following is a summary of the fair valuations according to the inputs used as of December 31, 2015 in valuing the Fund’s assets and liabilities:
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at | ||||||||||||
Investments in Securities, at Value |
| |||||||||||||||
Mutual Funds | $ | 2,404 | $ | 0 | $ | 0 | $ | 2,404 | ||||||||
Short-Term Instruments | ||||||||||||||||
U.S. Treasury Bills | 0 | 4 | 0 | 4 | ||||||||||||
$ | 2,404 | $ | 4 | $ | 0 | $ | 2,408 | |||||||||
Investments in Affiliates, at Value | ||||||||||||||||
Mutual Funds | 526 | 0 | 0 | 526 | ||||||||||||
Total Investments | $ | 2,930 | $ | 4 | $ | 0 | $ | 2,934 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at | ||||||||||||
Financial Derivative Instruments - Assets | ||||||||||||||||
Exchange-traded or centrally cleared | $ | 0 | $ | 15 | $ | 0 | $ | 15 | ||||||||
Over the counter | 0 | 1 | 0 | 1 | ||||||||||||
$ | 0 | $ | 16 | $ | 0 | $ | 16 | |||||||||
Financial Derivative Instruments - Liabilities | ||||||||||||||||
Exchange-traded or centrally cleared | $ | 0 | $ | (9 | ) | $ | 0 | $ | (9 | ) | ||||||
Totals | $ | 2,930 | $ | 11 | $ | 0 | $ | 2,941 |
There were no significant transfers between Levels 1, 2, or 3 during the period ended December 31, 2015.
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 55 |
Table of Contents
Schedule of Investments PIMCO RealPath™ Blend 2050 Fund
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN SECURITIES 82.7% | ||||||||||||
MUTUAL FUNDS 82.5% | ||||||||||||
Vanguard 500 Index Fund ‘Admiral’ | 4,385 | $ | 826 | |||||||||
Vanguard Developed Markets Index Fund ‘Admiral’ | 44,363 | 524 | ||||||||||
Vanguard Emerging Markets Stock Index Fund ‘Admiral’ | 19,068 | 521 | ||||||||||
Vanguard REIT Index Fund ‘Admiral’ | 2,757 | 312 | ||||||||||
Vanguard Small-Cap Index Fund ‘Admiral’ | 5,514 | 293 | ||||||||||
|
| |||||||||||
Total Mutual Funds (Cost $2,616) | 2,476 | |||||||||||
|
| |||||||||||
PRINCIPAL (000S) | ||||||||||||
SHORT-TERM INSTRUMENTS 0.2% | ||||||||||||
U.S. TREASURY BILLS 0.2% | ||||||||||||
0.202% due 01/14/2016 | $ | 4 | 4 | |||||||||
|
| |||||||||||
Total Short-Term Instruments (Cost $4) | 4 | |||||||||||
|
| |||||||||||
Total Investments in Securities (Cost $2,620) | 2,480 | |||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN AFFILIATES 15.0% | ||||||||||||
MUTUAL FUNDS (a) 15.0% | ||||||||||||
PIMCO Emerging Local Bond Fund | 11,086 | $ | 74 | |||||||||
PIMCO High Yield Fund | 9,022 | 75 | ||||||||||
PIMCO Long Duration Total Return Fund | 21,254 | 227 | ||||||||||
PIMCO Real Return Asset Fund | 9,819 | 75 | ||||||||||
|
| |||||||||||
Total Mutual Funds (Cost $507) | 451 | |||||||||||
|
| |||||||||||
Total Investments in Affiliates (Cost $507) | 451 | |||||||||||
Total Investments 97.7% (Cost $3,127) | $ | 2,931 | ||||||||||
Financial Derivative (Cost or Premiums, net $13) | 7 | |||||||||||
Other Assets and Liabilities, net 2.1% | 63 | |||||||||||
|
| |||||||||||
Net Assets 100.0% | $ | 3,001 | ||||||||||
|
|
NOTES TO SCHEDULE OF INVESTMENTS (AMOUNTS IN THOUSANDS*, EXCEPT NUMBER OF CONTRACTS AND UNITS):
* | A zero balance may reflect actual amounts rounding to less than one thousand. |
(a) | Institutional Class Shares of each Fund. |
(b) FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED
PURCHASED OPTIONS:
OPTIONS ON INDICES
Description | Strike Value | Expiration Date | # of Contracts | Cost | Market Value | |||||||||||||||
Put - CBOE S&P 500 Index | 1,550.000 | 01/15/2016 | 3 | $ | 12 | $ | 0 | |||||||||||||
Put - CBOE S&P 500 Index | 1,650.000 | 03/18/2016 | 3 | 9 | 2 | |||||||||||||||
Put - CBOE S&P 500 Index | 1,700.000 | 06/17/2016 | 3 | 10 | 7 | |||||||||||||||
Put - CBOE S&P 500 Index | 1,600.000 | 09/16/2016 | 2 | 10 | 6 | |||||||||||||||
|
|
|
| |||||||||||||||||
$ | 41 | $ | 15 | |||||||||||||||||
|
|
|
| |||||||||||||||||
Total Purchased Options | $ | 41 | $ | 15 | ||||||||||||||||
|
|
|
|
WRITTEN OPTIONS:
OPTIONS ON INDICES
Description | Strike Value | Expiration Date | # of Contracts | Premiums (Received) | Market Value | |||||||||||||||
Put - CBOE S&P 500 Index | 1,450.000 | 01/15/2016 | 3 | $ | (8 | ) | $ | 0 | ||||||||||||
Put - CBOE S&P 500 Index | 1,550.000 | 03/18/2016 | 3 | (7 | ) | (1 | ) | |||||||||||||
Put - CBOE S&P 500 Index | 1,600.000 | 06/17/2016 | 3 | (7 | ) | (5 | ) | |||||||||||||
Put - CBOE S&P 500 Index | 1,450.000 | 09/16/2016 | 2 | (6 | ) | (3 | ) | |||||||||||||
|
|
|
| |||||||||||||||||
$ | (28 | ) | $ | (9 | ) | |||||||||||||||
|
|
|
| |||||||||||||||||
Total Written Options | $ | (28 | ) | $ | (9 | ) | ||||||||||||||
|
|
|
|
56 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED SUMMARY
The following is a summary of the market value and variation margin of Exchange-Traded or Centrally Cleared Financial Derivative Instruments as of December 31, 2015:
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||
Market Value | Variation Margin Asset | Total | Market Value | Variation Margin Liability | Total | |||||||||||||||||||||||||||||
Purchased Options | Futures | Swap Agreements | Written Options | Futures | Swap Agreements | |||||||||||||||||||||||||||||
Total Exchange-Traded or Centrally Cleared | $ | 15 | $ | 0 | $ | 0 | $ | 15 | $ | (9) | $ | 0 | $ | 0 | $ | (9) | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(c) FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER
TRANSACTIONS IN WRITTEN CALL AND PUT OPTIONS FOR THE PERIOD ENDED DECEMBER 31, 2015:
# of Contracts | Premiums | |||||||
Balance at Beginning of Period | 6 | $ | (15 | ) | ||||
Sales | 5 | (13 | ) | |||||
Closing Buys | 0 | 0 | ||||||
Expirations | 0 | 0 | ||||||
Exercised | 0 | 0 | ||||||
|
|
|
| |||||
Balance at End of Period | 11 | $ | (28 | ) | ||||
|
|
|
|
SWAP AGREEMENTS:
TOTAL RETURN SWAPS ON COMMODITY INDICES
Counterparty | Pay/Receive (1) | Underlying Reference | # of Units | Financing Rate | Maturity Date | Notional Amount | Unrealized Appreciation | Swap Agreements, at Value | ||||||||||||||||||||||||||
Asset | Liability | |||||||||||||||||||||||||||||||||
CBK | Receive | BCOMTR Index | 467 | 3-Month U.S. Treasury Bill rate plus a | 02/16/2016 | $ | 73 | $ | 1 | $ | 1 | $ | 0 | |||||||||||||||||||||
|
|
|
|
|
| |||||||||||||||||||||||||||||
Total Swap Agreements | $ | 1 | $ | 1 | $ | 0 | ||||||||||||||||||||||||||||
|
|
|
|
|
|
(1) | Receive represents that the Fund receives payments for any positive return on the underlying reference. The Fund makes payments for any negative return on such underlying reference. Pay represents that the Fund receives payments for any negative return on the underlying reference. The Fund makes payments for any positive return on such underlying reference. |
FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER SUMMARY
The following is a summary by counterparty of the market value of OTC financial derivative instruments and collateral (received)/pledged as of December 31, 2015:
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||||||||||||||
Counterparty | Forward Foreign Currency Contracts | Purchased Options | Swap Agreements | Total Over the Counter | Forward Foreign Currency Contracts | Written Options | Swap Agreements | Total Over the Counter | Net Market Value of OTC Derivatives | Collateral (Received)/ Pledged | Net Exposure (2) | |||||||||||||||||||||||||||||||||||
CBK | $ | 0 | $ | 0 | $ | 1 | $ | 1 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1 | $ | 0 | $ | 1 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2) | Net Exposure represents the net receivable/(payable) that would be due from/to the counterparty in the event of default. Exposure from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same legal entity. See Note 6, Principal Risks, in the Notes to Financial Statements for more information regarding master netting arrangements. |
FAIR VALUE OF FINANCIAL DERIVATIVE INSTRUMENTS
The following is a summary of the fair valuation of the Fund’s derivative instruments categorized by risk exposure. See Note 6, Principal Risks, in the Notes to Financial Statements on risks of the Fund.
Fair Values of Financial Derivative Instruments on the Statements of Assets and Liabilities as of December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Financial Derivative Instruments - Assets | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Purchased Options | $ | 0 | $ | 0 | $ | 15 | $ | 0 | $ | 0 | $ | 15 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | 1 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 1 | $ | 0 | $ | 15 | $ | 0 | $ | 0 | $ | 16 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Financial Derivative Instruments - Liabilities | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Written Options | $ | 0 | $ | 0 | $ | 9 | $ | 0 | $ | 0 | $ | 9 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 57 |
Table of Contents
Schedule of Investments PIMCO RealPath™ Blend 2050 Fund (Cont.)
December 31, 2015 (Unaudited)
The Effect of Financial Derivative Instruments on the Statements of Operations for the Period Ended December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Net Realized (Loss) on Financial Derivative Instruments | ||||||||||||||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | (19 | ) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | (19 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Net Change in Unrealized Appreciation (Depreciation) on Financial Derivative Instruments |
| |||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Purchased Options | $ | 0 | $ | 0 | $ | (17 | ) | $ | 0 | $ | 0 | $ | (17 | ) | ||||||||||
Written Options | 0 | 0 | 12 | 0 | 0 | 12 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 0 | $ | 0 | $ | (5 | ) | $ | 0 | $ | 0 | $ | (5 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | (1 | ) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | (1 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | (1 | ) | $ | 0 | $ | (5 | ) | $ | 0 | $ | 0 | $ | (6 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
FAIR VALUE MEASUREMENTS
The following is a summary of the fair valuations according to the inputs used as of December 31, 2015 in valuing the Fund’s assets and liabilities:
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Investments in Securities, at Value |
| |||||||||||||||
Mutual Funds | $ | 2,476 | $ | 0 | $ | 0 | $ | 2,476 | ||||||||
Short-Term Instruments | ||||||||||||||||
U.S. Treasury Bills | 0 | 4 | 0 | 4 | ||||||||||||
$ | 2,476 | $ | 4 | $ | 0 | $ | 2,480 | |||||||||
Investments in Affiliates, at Value | ||||||||||||||||
Mutual Funds | 451 | 0 | 0 | 451 | ||||||||||||
Total Investments | $ | 2,927 | $ | 4 | $ | 0 | $ | 2,931 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Financial Derivative Instruments - Assets | ||||||||||||||||
Exchange-traded or centrally cleared | $ | 0 | $ | 15 | $ | 0 | $ | 15 | ||||||||
Over the counter | 0 | 1 | 0 | 1 | ||||||||||||
$ | 0 | $ | 16 | $ | 0 | $ | 16 | |||||||||
Financial Derivative Instruments - Liabilities | ||||||||||||||||
Exchange-traded or centrally cleared | $ | 0 | $ | (9 | ) | $ | 0 | $ | (9 | ) | ||||||
Totals | $ | 2,927 | $ | 11 | $ | 0 | $ | 2,938 |
There were no significant transfers between Levels 1, 2, or 3 during the period ended December 31, 2015.
58 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
Schedule of Investments PIMCO RealPath™ Blend 2055 Fund
December 31, 2015 (Unaudited)
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN SECURITIES 82.6% | ||||||||||||
MUTUAL FUNDS 82.5% | ||||||||||||
Vanguard 500 Index Fund ‘Admiral’ | 4,332 | $ | 816 | |||||||||
Vanguard Developed Markets Index Fund ‘Admiral’ | 43,833 | 518 | ||||||||||
Vanguard Emerging Markets Stock Index Fund ‘Admiral’ | 18,837 | 515 | ||||||||||
Vanguard REIT Index Fund ‘Admiral’ | 2,725 | 308 | ||||||||||
Vanguard Small-Cap Index Fund ‘Admiral’ | 5,448 | 289 | ||||||||||
|
| |||||||||||
Total Mutual Funds (Cost $2,588) | 2,446 | |||||||||||
|
| |||||||||||
PRINCIPAL (000S) | ||||||||||||
SHORT-TERM INSTRUMENTS 0.1% | ||||||||||||
U.S. TREASURY BILLS 0.1% | ||||||||||||
0.202% due 01/14/2016 | $ | 4 | 4 | |||||||||
|
| |||||||||||
Total Short-Term Instruments (Cost $4) | 4 | |||||||||||
|
| |||||||||||
Total Investments in Securities (Cost $2,592) | 2,450 | |||||||||||
|
|
SHARES | MARKET VALUE (000S) | |||||||||||
INVESTMENTS IN AFFILIATES 15.1% | ||||||||||||
MUTUAL FUNDS (a) 15.1% | ||||||||||||
PIMCO Emerging Local Bond Fund | 10,954 | $ | 73 | |||||||||
PIMCO High Yield Fund | 8,914 | 74 | ||||||||||
PIMCO Long Duration Total Return Fund | 20,999 | 224 | ||||||||||
PIMCO Real Return Asset Fund | 9,701 | 74 | ||||||||||
|
| |||||||||||
Total Mutual Funds (Cost $501) | 445 | |||||||||||
|
| |||||||||||
Total Investments in Affiliates (Cost $501) | 445 | |||||||||||
Total Investments 97.7% (Cost $3,093) | $ | 2,895 | ||||||||||
Financial Derivative (Cost or Premiums, net $13) | 7 | |||||||||||
Other Assets and Liabilities, net 2.1% | 62 | |||||||||||
|
| |||||||||||
Net Assets 100.0% | $ | 2,964 | ||||||||||
|
|
NOTES TO SCHEDULE OF INVESTMENTS (AMOUNTS IN THOUSANDS*, EXCEPT NUMBER OF CONTRACTS AND UNITS):
* | A zero balance may reflect actual amounts rounding to less than one thousand. |
(a) | Institutional Class Shares of each Fund. |
(b) FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED
PURCHASED OPTIONS:
OPTIONS ON INDICES
Description | Strike Value | Expiration Date | # of Contracts | Cost | Market Value | |||||||||||||||
Put - CBOE S&P 500 Index | 1,550.000 | 01/15/2016 | 3 | $ | 12 | $ | 0 | |||||||||||||
Put - CBOE S&P 500 Index | 1,650.000 | 03/18/2016 | 3 | 9 | 2 | |||||||||||||||
Put - CBOE S&P 500 Index | 1,700.000 | 06/17/2016 | 3 | 10 | 7 | |||||||||||||||
Put - CBOE S&P 500 Index | 1,600.000 | 09/16/2016 | 2 | 10 | 6 | |||||||||||||||
|
|
|
| |||||||||||||||||
$ | 41 | $ | 15 | |||||||||||||||||
|
|
|
| |||||||||||||||||
Total Purchased Options | $ | 41 | $ | 15 | ||||||||||||||||
|
|
|
|
WRITTEN OPTIONS:
OPTIONS ON INDICES
Description | Strike Value | Expiration Date | # of Contracts | Premiums (Received) | Market Value | |||||||||||||||
Put - CBOE S&P 500 Index | 1,450.000 | 01/15/2016 | 3 | $ | (8 | ) | $ | 0 | ||||||||||||
Put - CBOE S&P 500 Index | 1,550.000 | 03/18/2016 | 3 | (7 | ) | (1 | ) | |||||||||||||
Put - CBOE S&P 500 Index | 1,600.000 | 06/17/2016 | 3 | (7 | ) | (5 | ) | |||||||||||||
Put - CBOE S&P 500 Index | 1,450.000 | 09/16/2016 | 2 | (6 | ) | (3 | ) | |||||||||||||
|
|
|
| |||||||||||||||||
$ | (28 | ) | $ | (9 | ) | |||||||||||||||
|
|
|
| |||||||||||||||||
Total Written Options | $ | (28 | ) | $ | (9 | ) | ||||||||||||||
|
|
|
|
FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED SUMMARY
The following is a summary of the market value and variation margin of Exchange-Traded or Centrally Cleared Financial Derivative Instruments as of December 31, 2015:
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||
Market Value | Variation Margin Asset | Total | Market Value | Variation Margin Liability | Total | |||||||||||||||||||||||||||||
Purchased Options | Futures | Swap Agreements | Written Options | Futures | Swap Agreements | |||||||||||||||||||||||||||||
Total Exchange-Traded or Centrally Cleared | $ | 15 | $ | 0 | $ | 0 | $ | 15 | $ | (9) | $ | 0 | $ | 0 | $ | (9) | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 59 |
Table of Contents
Schedule of Investments PIMCO RealPath™ Blend 2055 Fund (Cont.)
(c) FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER
TRANSACTIONS IN WRITTEN CALL AND PUT OPTIONS FOR THE PERIOD ENDED DECEMBER 31, 2015:
# of Contracts | Premiums | |||||||
Balance at Beginning of Period | 6 | $ | (15 | ) | ||||
Sales | 5 | (13 | ) | |||||
Closing Buys | 0 | 0 | ||||||
Expirations | 0 | 0 | ||||||
Exercised | 0 | 0 | ||||||
|
|
|
| |||||
Balance at End of Period | 11 | $ | (28 | ) | ||||
|
|
|
|
SWAP AGREEMENTS:
TOTAL RETURN SWAPS ON COMMODITY INDICES
Counterparty | Pay/Receive (1) | Underlying Reference | # of Units | Financing Rate | Maturity Date | Notional Amount | Unrealized Appreciation | Swap Agreements, at Value | ||||||||||||||||||||||||||
Asset | Liability | |||||||||||||||||||||||||||||||||
CBK | Receive | BCOMTR Index | 461 | 3-Month U.S. Treasury Bill rate plus a specified spread | 02/16/2016 | $ | 72 | $ | 1 | $ | 1 | $ | 0 | |||||||||||||||||||||
|
|
|
|
|
| |||||||||||||||||||||||||||||
Total Swap Agreements | $ | 1 | $ | 1 | $ | 0 | ||||||||||||||||||||||||||||
|
|
|
|
|
|
(1) | Receive represents that the Fund receives payments for any positive return on the underlying reference. The Fund makes payments for any negative return on such underlying reference. Pay represents that the Fund receives payments for any negative return on the underlying reference. The Fund makes payments for any positive return on such underlying reference. |
FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER SUMMARY
The following is a summary by counterparty of the market value of OTC financial derivative instruments and collateral (received)/pledged as of December 31, 2015:
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||||||||||||||
Counterparty | Forward Foreign Currency Contracts | Purchased Options | Swap Agreements | Total Over the Counter | Forward Foreign Currency Contracts | Written Options | Swap Agreements | Total Over the Counter | Net Market Value of OTC Derivatives | Collateral (Received)/ Pledged | Net Exposure (2) | |||||||||||||||||||||||||||||||||||
CBK | $ | 0 | $ | 0 | $ | 1 | $ | 1 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1 | $ | 0 | $ | 1 | ||||||||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
(2) | Net Exposure represents the net receivable/(payable) that would be due from/to the counterparty in the event of default. Exposure from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same legal entity. See Note 6, Principal Risks, in the Notes to Financial Statements for more information regarding master netting arrangements. |
FAIR VALUE OF FINANCIAL DERIVATIVE INSTRUMENTS
The following is a summary of the fair valuation of the Fund’s derivative instruments categorized by risk exposure. See Note 6, Principal Risks, in the Notes to Financial Statements on risks of the Fund.
Fair Values of Financial Derivative Instruments on the Statements of Assets and Liabilities as of December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Financial Derivative Instruments - Assets | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Purchased Options | $ | 0 | $ | 0 | $ | 15 | $ | 0 | $ | 0 | $ | 15 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | 1 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 1 | $ | 0 | $ | 15 | $ | 0 | $ | 0 | $ | 16 | |||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Financial Derivative Instruments - Liabilities | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Written Options | $ | 0 | $ | 0 | $ | 9 | $ | 0 | $ | 0 | $ | 9 | ||||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
60 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
The Effect of Financial Derivative Instruments on the Statements of Operations for the Period Ended December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Net Realized (Loss) on Financial Derivative Instruments | ||||||||||||||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | (19 | ) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | (19 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Net Change in Unrealized Appreciation (Depreciation) on Financial Derivative Instruments |
| |||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Purchased Options | $ | 0 | $ | 0 | $ | (17 | ) | $ | 0 | $ | 0 | $ | (17 | ) | ||||||||||
Written Options | 0 | 0 | 12 | 0 | 0 | 12 | ||||||||||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | 0 | $ | 0 | $ | (5 | ) | $ | 0 | $ | 0 | $ | (5 | ) | |||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | (1 | ) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | (1 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
| |||||||||||||
$ | (1 | ) | $ | 0 | $ | (5 | ) | $ | 0 | $ | 0 | $ | (6 | ) | ||||||||||
|
|
|
|
|
|
|
|
|
|
|
|
FAIR VALUE MEASUREMENTS (1)
The following is a summary of the fair valuations according to the inputs used as of December 31, 2015 in valuing the Fund’s assets and liabilities:
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Investments in Securities, at Value | ||||||||||||||||
Mutual Funds | $ | 2,446 | $ | 0 | $ | 0 | $ | 2,446 | ||||||||
Short-Term Instruments | ||||||||||||||||
U.S. Treasury Bills | 0 | 4 | 0 | 4 | ||||||||||||
$ | 2,446 | $ | 4 | $ | 0 | $ | 2,450 | |||||||||
Investments in Affiliates, at Value | ||||||||||||||||
Mutual Funds | 445 | 0 | 0 | 445 | ||||||||||||
Total Investments | $ | 2,891 | $ | 4 | $ | 0 | $ | 2,895 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Financial Derivative Instruments - Assets | ||||||||||||||||
Exchange-traded or centrally cleared | $ | 0 | $ | 15 | $ | 0 | $ | 15 | ||||||||
Over the counter | 0 | 1 | 0 | 1 | ||||||||||||
$ | 0 | $ | 16 | $ | 0 | $ | 16 | |||||||||
Financial Derivative Instruments - Liabilities | ||||||||||||||||
Exchange-traded or centrally cleared | $ | 0 | $ | (9 | ) | $ | 0 | $ | (9 | ) | ||||||
Totals | $ | 2,891 | $ | 11 | $ | 0 | $ | 2,902 |
There were no significant transfers between Levels 1, 2, or 3 during the period ended December 31, 2015.
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 61 |
Table of Contents
Schedule of Investments PIMCO RealPath™ Blend Income Fund
SHARES | MARKET VALUE (000S) | |||||||||
INVESTMENTS IN SECURITIES 32.5% | ||||||||||
MUTUAL FUNDS 32.4% | ||||||||||
Vanguard 500 Index Fund ‘Admiral’ | 2,032 | $ | 383 | |||||||
Vanguard Developed Markets Index Fund ‘Admiral’ | 19,330 | 229 | ||||||||
Vanguard Emerging Markets Stock Index Fund ‘Admiral’ | 5,555 | 152 | ||||||||
Vanguard REIT Index Fund ‘Admiral’ | 1,402 | 158 | ||||||||
Vanguard Small-Cap Index Fund ‘Admiral’ | 1,406 | 75 | ||||||||
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Total Mutual Funds (Cost $1,039) | 997 | |||||||||
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PRINCIPAL AMOUNT (000S) | ||||||||||
SHORT-TERM INSTRUMENTS 0.1% | ||||||||||
U.S. TREASURY BILLS 0.1% | ||||||||||
0.191% due 01/14/2016 | $ | 3 | 3 | |||||||
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Total Short-Term Instruments (Cost $3) | 3 | |||||||||
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Total Investments in Securities (Cost $1,042) | 1,000 | |||||||||
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SHARES | MARKET VALUE (000S) | |||||||||
INVESTMENTS IN AFFILIATES 65.2% | ||||||||||
MUTUAL FUNDS (a) 60.1% | ||||||||||
PIMCO Emerging Local Bond Fund | 11,443 | $ | 76 | |||||||
PIMCO Foreign Bond Fund (U.S. Dollar-Hedged) | 31,251 | 310 | ||||||||
PIMCO High Yield Fund | 9,309 | 77 | ||||||||
PIMCO Long Duration Total Return Fund | 21,603 | 231 | ||||||||
PIMCO Real Return Asset Fund | 29,940 | 229 | ||||||||
PIMCO Real Return Fund | 44,011 | 462 | ||||||||
PIMCO Total Return Fund | 46,421 | 467 | ||||||||
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Total Mutual Funds (Cost $1,992) | 1,852 | |||||||||
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SHARES | MARKET VALUE (000S) | |||||||||
SHORT-TERM INSTRUMENTS 5.1% | ||||||||||
CENTRAL FUNDS USED FOR CASH MANAGEMENT PURPOSES 5.1% | ||||||||||
PIMCO Short-Term | 15,852 | $ | 157 | |||||||
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Total Short-Term Instruments (Cost $157) | 157 | |||||||||
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Total Investments in Affiliates (Cost $2,149) | 2,009 | |||||||||
Total Investments 97.7% (Cost $3,191) | $ | 3,009 | ||||||||
Financial Derivative Instruments (b)(c) 0.3% (Cost or Premiums, net $12) | 8 | |||||||||
Other Assets and Liabilities, net 2.0% | 63 | |||||||||
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Net Assets 100.0% | $ | 3,080 | ||||||||
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NOTES TO SCHEDULE OF INVESTMENTS (AMOUNTS IN THOUSANDS*, EXCEPT NUMBER OF CONTRACTS AND UNITS):
* | A zero balance may reflect actual amounts rounding to less than one thousand. |
(a) | Institutional Class Shares of each Fund. |
(b) FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED
PURCHASED OPTIONS:
OPTIONS ON INDICES
Description | Strike Value | Expiration Date | # of Contracts | Cost | Market Value | |||||||||||||||
Put - CBOE S&P 500 Index | 1,750.000 | 01/15/2016 | 1 | $ | 7 | $ | 0 | |||||||||||||
Put - CBOE S&P 500 Index | 1,850.000 | 03/18/2016 | 1 | 6 | 2 | |||||||||||||||
Put - CBOE S&P 500 Index | 1,850.000 | 06/17/2016 | 1 | 6 | 5 | |||||||||||||||
Put - CBOE S&P 500 Index | 1,750.000 | 09/16/2016 | 1 | 7 | 5 | |||||||||||||||
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$ | 26 | $ | 12 | |||||||||||||||||
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Total Purchased Options | $ | 26 | $ | 12 | ||||||||||||||||
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WRITTEN OPTIONS:
OPTIONS ON INDICES
Description | Strike Value | Expiration Date | # of Contracts | Premiums (Received) | Market Value | |||||||||||||||
Put - CBOE S&P 500 Index | 1,600.000 | 01/15/2016 | 1 | $ | (5 | ) | $ | 0 | ||||||||||||
Put - CBOE S&P 500 Index | 1,650.000 | 03/18/2016 | 1 | (3 | ) | (1 | ) | |||||||||||||
Put - CBOE S&P 500 Index | 1,650.000 | 06/17/2016 | 1 | (3 | ) | (2 | ) | |||||||||||||
Put - CBOE S&P 500 Index | 1,500.000 | 09/16/2016 | 1 | (3 | ) | (2 | ) | |||||||||||||
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$ | (14 | ) | $ | (5 | ) | |||||||||||||||
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Total Written Options | $ | (14 | ) | $ | (5 | ) | ||||||||||||||
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62 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
FINANCIAL DERIVATIVE INSTRUMENTS: EXCHANGE-TRADED OR CENTRALLY CLEARED SUMMARY
The following is a summary of the market value and variation margin of Exchange-Traded or Centrally Cleared Financial Derivative Instruments as of December 31, 2015:
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||
Market Value | Variation Margin Asset | Total | Market Value | Variation Margin Liability | Total | |||||||||||||||||||||||||||||
Purchased Options | Futures | Swap Agreements | Written Options | Futures | Swap Agreements | |||||||||||||||||||||||||||||
Total Exchange-Traded or Centrally Cleared | $ | 12 | $ | 0 | $ | 0 | $ | 12 | $ | (5) | $ | 0 | $ | 0 | $ | (5) | ||||||||||||||||||
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(c) FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER
TRANSACTIONS IN WRITTEN CALL AND PUT OPTIONS FOR THE PERIOD ENDED DECEMBER 31, 2015:
# of Contracts | Premiums | |||||||
Balance at Beginning of Period | 2 | $ | (8 | ) | ||||
Sales | 2 | (6 | ) | |||||
Closing Buys | 0 | 0 | ||||||
Expirations | 0 | 0 | ||||||
Exercised | 0 | 0 | ||||||
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Balance at End of Period | 4 | $ | (14 | ) | ||||
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SWAP AGREEMENTS:
TOTAL RETURN SWAPS ON COMMODITY INDICES
Counterparty | Pay/Receive (1) | Underlying Reference | # of Units | Financing Rate | Maturity Date | Notional Amount | Unrealized Appreciation | Swap Agreements, at Value | ||||||||||||||||||||||||||
Asset | Liability | |||||||||||||||||||||||||||||||||
CBK | Receive | BCOMTR Index | 476 | 3-Month U.S. Treasury Bill rate plus a specified spread | 02/16/2016 | $ | 74 | $ | 1 | $ | 1 | $ | 0 | |||||||||||||||||||||
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Total Swap Agreements |
| $ | 1 | $ | 1 | $ | 0 | |||||||||||||||||||||||||||
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(1) | Receive represents that the Fund receives payments for any positive return on the underlying reference. The Fund makes payments for any negative return on such underlying reference. Pay represents that the Fund receives payments for any negative return on the underlying reference. The Fund makes payments for any positive return on such underlying reference. |
FINANCIAL DERIVATIVE INSTRUMENTS: OVER THE COUNTER SUMMARY
The following is a summary by counterparty of the market value of OTC financial derivative instruments and collateral (received)/pledged as of December 31, 2015:
Financial Derivative Assets | Financial Derivative Liabilities | |||||||||||||||||||||||||||||||||||||||||||||
Counterparty | Forward Foreign Currency Contracts | Purchased Options | Swap Agreements | Total Over the Counter | Forward Foreign Currency Contracts | Written Options | Swap Agreements | Total Over the Counter | Net Market Value of OTC Derivatives | Collateral (Received)/ Pledged | Net Exposure (2) | |||||||||||||||||||||||||||||||||||
CBK | $ | 0 | $ | 0 | $ | 1 | $ | 1 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1 | $ | 0 | $ | 1 | ||||||||||||||||||||||||
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(2) | Net Exposure represents the net receivable/(payable) that would be due from/to the counterparty in the event of default. Exposure from OTC financial derivative instruments can only be netted across transactions governed under the same master agreement with the same legal entity. See Note 6, Principal Risks, in the Notes to Financial Statements for more information regarding master netting arrangements. |
See Accompanying Notes | SEMIANNUAL REPORT | DECEMBER 31, 2015 | 63 |
Table of Contents
Schedule of Investments PIMCO RealPath™ Blend Income Fund (Cont.)
December 31, 2015 (Unaudited)
FAIR VALUE OF FINANCIAL DERIVATIVE INSTRUMENTS
The following is a summary of the fair valuation of the Fund’s derivative instruments categorized by risk exposure. See Note 6, Principal Risks, in the Notes to Financial Statements on risks of the Fund.
Fair Values of Financial Derivative Instruments on the Statements of Assets and Liabilities as of December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Financial Derivative Instruments - Assets | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Purchased Options | $ | 0 | $ | 0 | $ | 12 | $ | 0 | $ | 0 | $ | 12 | ||||||||||||
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Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | 1 | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | 1 | ||||||||||||
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$ | 1 | $ | 0 | $ | 12 | $ | 0 | $ | 0 | $ | 13 | |||||||||||||
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Financial Derivative Instruments - Liabilities | ||||||||||||||||||||||||
Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Written Options | $ | 0 | $ | 0 | $ | 5 | $ | 0 | $ | 0 | $ | 5 | ||||||||||||
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The Effect of Financial Derivative Instruments on the Statements of Operations for the Period Ended December 31, 2015:
Derivatives not accounted for as hedging instruments | ||||||||||||||||||||||||
Commodity Contracts | Credit Contracts | Equity Contracts | Foreign Exchange Contracts | Interest Rate Contracts | Total | |||||||||||||||||||
Net Realized (Loss) on Financial Derivative Instruments | ||||||||||||||||||||||||
Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | (19 | ) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | (19 | ) | ||||||||||
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Net Change in Unrealized Appreciation (Depreciation) on Financial Derivative Instruments |
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Exchange-traded or centrally cleared | ||||||||||||||||||||||||
Purchased Options | $ | 0 | $ | 0 | $ | (11 | ) | $ | 0 | $ | 0 | $ | (11 | ) | ||||||||||
Written Options | 0 | 0 | 6 | 0 | 0 | 6 | ||||||||||||||||||
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$ | 0 | $ | 0 | $ | (5 | ) | $ | 0 | $ | 0 | $ | (5 | ) | |||||||||||
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Over the counter | ||||||||||||||||||||||||
Swap Agreements | $ | (1 | ) | $ | 0 | $ | 0 | $ | 0 | $ | 0 | $ | (1 | ) | ||||||||||
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$ | (1 | ) | $ | 0 | $ | (5 | ) | $ | 0 | $ | 0 | $ | (6 | ) | ||||||||||
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FAIR VALUE MEASUREMENTS
The following is a summary of the fair valuations according to the inputs used as of December 31, 2015 in valuing the Fund’s assets and liabilities:
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Investments in Securities, at Value |
| |||||||||||||||
Mutual Funds | $ | 997 | $ | 0 | $ | 0 | $ | 997 | ||||||||
Short-Term Instruments | ||||||||||||||||
U.S. Treasury Bills | 0 | 3 | 0 | 3 | ||||||||||||
$ | 997 | $ | 3 | $ | 0 | $ | 1,000 | |||||||||
Investments in Affiliates, at Value | ||||||||||||||||
Mutual Funds | 1,852 | 0 | 0 | 1,852 | ||||||||||||
Short-Term Instruments | ||||||||||||||||
Central Funds Used for Cash Management Purposes | 157 | 0 | 0 | 157 | ||||||||||||
$ | 2,009 | $ | 0 | $ | 0 | $ | 2,009 | |||||||||
Total Investments | $ | 3,006 | $ | 3 | $ | 0 | $ | 3,009 |
Category and Subcategory | Level 1 | Level 2 | Level 3 | Fair Value at 12/31/2015 | ||||||||||||
Financial Derivative Instruments - Assets | ||||||||||||||||
Exchange-traded or centrally cleared | $ | 0 | $ | 12 | $ | 0 | $ | 12 | ||||||||
Over the counter | 0 | 1 | 0 | 1 | ||||||||||||
$ | 0 | $ | 13 | $ | 0 | $ | 13 | |||||||||
Financial Derivative Instruments - Liabilities | ||||||||||||||||
Exchange-traded or centrally cleared | $ | 0 | $ | (5 | ) | $ | 0 | $ | (5 | ) | ||||||
Totals | $ | 3,006 | $ | 11 | $ | 0 | $ | 3,017 |
There were no significant transfers between Levels 1, 2, or 3 during the period ended December 31, 2015.
64 | PIMCO EQUITY SERIES | See Accompanying Notes |
Table of Contents
December 31, 2015 (Unaudited)
1. ORGANIZATION
PIMCO Equity Series (the “Trust”) was established as a Delaware statutory trust on December 28, 2009. The Trust is registered under the Investment Company Act of 1940, as amended (the “Act”), as an open-end management investment company. Information presented in these financial statements pertains to the Institutional Class, Administrative Class, and Class A shares of the funds (each a “Fund” and collectively the “Funds”) indicated on the cover of this report. Pacific Investment Management Company LLC (“PIMCO”) serves as the investment adviser (the “Adviser”) for the Funds.
2. SIGNIFICANT ACCOUNTING POLICIES
The following is a summary of significant accounting policies consistently followed by the Trust in the preparation of its financial statements in conformity with accounting principles generally accepted in the United States of America (“U.S. GAAP”). Each Fund is treated as an investment company under the reporting requirements of U.S. GAAP. The preparation of financial statements in accordance with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of increases and decreases in net assets from operations during the reporting period. Actual results could differ from those estimates.
(a) Securities Transactions and Investment Income Securities transactions are recorded as of the trade date for financial reporting purposes. Securities purchased or sold on a when-issued or delayed-delivery basis may be settled 15 days or more after the trade date. Realized gains and losses from securities sold are recorded on the identified cost basis. Dividend income is recorded on the ex-dividend date, except certain dividends from foreign securities where the ex-dividend date may have passed, which are recorded as soon as the Fund is informed of the ex-dividend date. Interest income, adjusted for the accretion of discounts and amortization of premiums, is recorded on the accrual basis from settlement date, with the exception of securities with a forward starting effective date, where interest income is recorded on the accrual basis from effective date. For convertible securities, premiums attributable to the conversion feature are not amortized. Estimated tax liabilities on certain foreign securities are recorded on an accrual basis and are reflected as components of interest income or net change in unrealized appreciation (depreciation) on investments on the Statements of Operations, as appropriate. Tax liabilities realized as a result of such security sales are reflected as a component of net realized gain (loss) on investments on the Statements of Operations. Paydown gains and losses on mortgage-related and other asset-backed securities are recorded as components of interest income on the Statements of Operations. Income or short-term capital gain distributions received from registered investment companies are recorded as dividend income. Long-term
capital gain distributions received from registered investment companies are recorded as realized gains.
(b) Multiclass Operations Each class offered by the Trust has equal rights as to assets and voting privileges (except that shareholders of a class have exclusive voting rights regarding any matter relating solely to that class of shares). Income and non-class specific expenses are allocated daily to each class on the basis of the relative net assets. Realized and unrealized capital gains and losses are allocated daily based on the relative net assets of each class of the respective Fund. Class specific expenses, where applicable, currently include supervisory and administrative and distribution and servicing fees. Under certain circumstances, the per share net asset value (“NAV”) of a class of the respective Fund’s shares may be different from the per share NAV of another class of shares as a result of the different daily expense accruals applicable to each class of shares.
(c) Dividends and Distributions to Shareholders Dividends from net investment income, if any, of each Fund, are declared and distributed to shareholders annually. Net realized capital gains earned by each Fund, if any, will be distributed no less frequently than once each year.
Income dividends and capital gain distributions are determined in accordance with income tax regulations which may differ from U.S. GAAP. Differences between tax regulations and U.S. GAAP may cause timing differences between income and capital gain recognition. Examples of events that give rise to timing differences include wash sales, straddles and capital loss carryforwards. Further, the character of investment income and capital gains may be different for certain transactions under the two methods of accounting. Examples of transactions that may cause character differences include the treatment of paydowns on mortgage-backed securities, swaps, foreign currency transactions and contingent debt instruments. As a result, income dividends and capital gain distributions declared during a fiscal period may differ significantly from the net investment income (loss) and realized gains (losses) reported on each Fund’s annual financial statements presented under U.S. GAAP.
Distributions classified as a tax basis return of capital, if any, are reflected on the Statements of Changes in Net Assets and have been recorded to paid in capital. In addition, other amounts have been reclassified between undistributed (overdistributed) net investment income (loss), accumulated undistributed (overdistributed) net realized gains (losses) and/or paid in capital to more appropriately conform financial accounting to tax characterizations of dividend distributions.
(d) New Accounting Pronouncements In June 2014, the Financial Accounting Standards Board (“FASB”) issued an Accounting Standards Update (“ASU”), ASU 2014-11, that expanded secured borrowing accounting for certain repurchase agreements. The ASU also sets forth
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 65 |
Table of Contents
Notes to Financial Statements (Cont.)
additional disclosure requirements for certain transactions accounted for as sales in order to provide financial statement users with information to compare to similar transactions accounted for as secured borrowings. The ASU became effective prospectively for annual periods beginning after December 15, 2014, and interim periods beginning after March 15, 2015. The Funds have adopted the ASU. The financial statements have been modified to provide enhanced disclosures surrounding secured borrowing transactions, if any. See the Notes to Schedules of Investments for additional details.
In August 2014, the FASB issued ASU 2014-15 requiring management to evaluate whether there are conditions or events, considered in the aggregate, that raise substantial doubt about the entity’s ability to continue as a going concern. The ASU is effective prospectively for annual periods ending after December 15, 2016, and interim periods thereafter. At this time, management is evaluating the implications of these changes on the financial statements.
In May 2015, the FASB issued ASU 2015-07 which removes the requirement to categorize within the fair value hierarchy all investments for which fair value is measured using the NAV per share practical expedient. The ASU also removes the requirement to make certain disclosures for all investments that are eligible to be measured at fair value using the NAV per share practical expedient. The ASU is effective for annual periods beginning after December 15, 2015 and interim periods within those annual periods. At this time, management is evaluating the implications of these changes on the financial statements.
3. INVESTMENT VALUATION AND FAIR VALUE MEASUREMENTS
(a) Investment Valuation Policies The price of a Fund’s shares is based on the Fund’s NAV. The NAV of a Fund, or each of its share classes, as applicable, is determined by dividing the total value of portfolio investments and other assets attributable to that Fund or class, less any liabilities, by the total number of shares outstanding of that Fund or class.
On each day that the New York Stock Exchange (“NYSE”) is open, Fund shares are ordinarily valued as of the close of regular trading (“NYSE Close”). Information that becomes known to the Funds or their agents after the time as of which NAV has been calculated on a particular day will not generally be used to retroactively adjust the price of a security or the NAV determined earlier that day. Each Fund reserves the right to change the time its respective NAV is calculated if the Fund closes earlier, or as permitted by the SEC.
For purposes of calculating NAV, portfolio securities and other assets for which market quotes are readily available are valued at market value. Market value is generally determined on the basis of official closing prices
or the last reported sales prices, or if no sales are reported, based on quotes obtained from established market makers or prices (including evaluated prices) supplied by the Funds’ approved pricing services, quotation reporting systems and other third-party sources (together, “Pricing Services”). The Funds will normally use pricing data for domestic equity securities received shortly after the NYSE Close and do not normally take into account trading, clearances or settlements that take place after the NYSE Close. A foreign (non-U.S.) equity security traded on a foreign exchange or on more than one exchange is typically valued using pricing information from the exchange considered by the Adviser to be the primary exchange. A foreign (non-U.S.) equity security will be valued as of the close of trading on the foreign exchange, or the NYSE Close, if the NYSE Close occurs before the end of trading on the foreign exchange. Domestic and foreign (non-U.S.) fixed income securities, non-exchange traded derivatives, and equity options are normally valued on the basis of quotes obtained from brokers and dealers or Pricing Services using data reflecting the earlier closing of the principal markets for those securities. Prices obtained from Pricing Services may be based on, among other things, information provided by market makers or estimates of market values obtained from yield data relating to investments or securities with similar characteristics. Certain fixed income securities purchased on a delayed-delivery basis are marked to market daily until settlement at the forward settlement date. Exchange-traded options, except equity options, futures and options on futures are valued at the settlement price determined by the relevant exchange. Swap agreements are valued on the basis of bid quotes obtained from brokers and dealers or market-based prices supplied by Pricing Services or other pricing sources. With respect to any portion of the Fund’s assets that are invested in one or more open-end management investment companies (other than exchange-traded funds (“ETFs”)), a Fund’s NAV will be calculated based upon the NAVs of such investments.
If a foreign (non-U.S.) equity security’s value has materially changed after the close of the security’s primary exchange or principal market but before the NYSE Close, the security may be valued at fair value based on procedures established and approved by the Board of Trustees of the Trust (the “Board”). Foreign (non-U.S.) equity securities that do not trade when the NYSE is open are also valued at fair value. With respect to foreign (non-U.S.) equity securities, the Fund may determine the fair value of investments based on information provided by Pricing Services and other third-party vendors, which may recommend fair value or adjustments with reference to other securities, indices or assets. In considering whether fair valuation is required and in determining fair values, the Fund may, among other things, consider significant events (which may be considered to include changes in the value of U.S. securities or securities indices) that occur after the close of the relevant market and before the NYSE Close. A Fund may utilize modeling tools provided by third-party vendors to determine fair values
66 | PIMCO EQUITY SERIES |
Table of Contents
December 31, 2015 (Unaudited)
of non-U.S. securities. Foreign (non-U.S.) exchanges may permit trading in foreign (non-U.S.) equity securities on days when the Trust is not open for business, which may result in a Fund’s portfolio investments being affected when shareholders are unable to buy or sell shares.
Senior secured floating rate loans for which an active secondary market exists to a reliable degree will be valued at the mean of the last available bid/ask prices in the market for such loans, as provided by a Pricing Service. Senior secured floating rate loans for which an active secondary market does not exist to a reliable degree will be valued at fair value, which is intended to approximate market value. In valuing a senior secured floating rate loan at fair value, the factors considered may include, but are not limited to, the following: (a) the creditworthiness of the borrower and any intermediate participants, (b) the terms of the loan, (c) recent prices in the market for similar loans, if any, and (d) recent prices in the market for instruments of similar quality, rate, period until next interest rate reset and maturity.
Investments valued in currencies other than the U.S. dollar are converted to the U.S. dollar using exchange rates obtained from Pricing Services. As a result, the value of such investments and, in turn, the NAV of the Fund’s shares may be affected by changes in the value of currencies in relation to the U.S. dollar. The value of investments traded in markets outside the United States or denominated in currencies other than the U.S. dollar may be affected significantly on a day that the Trust is not open for business. As a result, to the extent that a Fund holds foreign (non-U.S.) investments, the value of those investments may change at times when shareholders are unable to buy or sell shares and the value of such investments will be reflected in the Fund’s next calculated NAV.
Investments for which market quotes or market based valuations are not readily available are valued at fair value as determined in good faith by the Board or persons acting at their direction. The Board has adopted methods for valuing securities and other assets in circumstances where market quotes are not readily available, and has delegated to the Adviser the responsibility for applying the fair valuation methods. In the event that market quotes or market based valuations are not readily available, and the security or asset cannot be valued pursuant to a Board approved valuation method, the value of the security or asset will be determined in good faith by the Valuation Oversight Committee of the Board (“Valuation Oversight Committee”), generally based on recommendations provided by the Adviser. Market quotes are considered not readily available in circumstances where there is an absence of current or reliable market-based data (e.g., trade information, bid/ask information, indicative market quotations (“Broker Quotes”), Pricing Services’ prices), including where events occur after the close of the relevant market, but prior to the NYSE Close, that materially affect the values of a Fund’s securities or assets. In addition, market quotes are considered not readily available when, due to
extraordinary circumstances, the exchanges or markets on which the securities trade do not open for trading for the entire day and no other market prices are available. The Board has delegated to the Adviser the responsibility for monitoring significant events that may materially affect the values of the Fund’s securities or assets and for determining whether the value of the applicable securities or assets should be reevaluated in light of such significant events.
When a Fund uses fair valuation to determine the value of a portfolio security or other asset for purposes of calculating its NAV, such investments will not be priced on the basis of quotes from the primary market in which they are traded, but rather may be priced by another method that the Board or persons acting at their direction believe reflects fair value. Fair valuation may require subjective determinations about the value of a security. While the Trust’s policy is intended to result in a calculation of the Fund’s NAV that fairly reflects security values as of the time of pricing, the Trust cannot ensure that fair values determined by the Board or persons acting at their direction would accurately reflect the price that a Fund could obtain for a security if it were to dispose of that security as of the time of pricing (for instance, in a forced or distressed sale). The prices used by a Fund may differ from the value that would be realized if the securities were sold. The Funds’ use of fair valuation may also help to deter “stale price arbitrage” as discussed under the “Abusive Trading Practices” section in each Fund’s prospectus.
(b) Fair Value Hierarchy U.S. GAAP describes fair value as the price that a Fund would receive to sell an asset or pay to transfer a liability in an orderly transaction between market participants at the measurement date. It establishes a fair value hierarchy that prioritizes inputs to valuation methods and requires disclosure of the fair value hierarchy, separately for each major category of assets and liabilities, that segregates fair value measurements into levels (Level 1, 2, or 3). The inputs or methodology used for valuing securities are not necessarily an indication of the risks associated with investing in those securities. Levels 1, 2, and 3 of the fair value hierarchy are defined as follows:
n | Level 1 — Inputs using (unadjusted) quoted prices in active markets or exchanges for identical assets and liabilities. |
n | Level 2 — Significant other observable inputs, which may include, but are not limited to, quoted prices for similar assets or liabilities in markets that are active, quoted prices for identical or similar assets or liabilities in markets that are not active, inputs other than quoted prices that are observable for the assets or liabilities (such as interest rates, yield curves, volatilities, prepayment speeds, loss severities, credit risks and default rates) or other market corroborated inputs. |
n | Level 3 — Significant unobservable inputs based on the best information available in the circumstances, to the extent observable |
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inputs are not available, which may include assumptions made by the Board or persons acting at their direction that are used in determining the fair value of investments. |
In accordance with the requirements of U.S. GAAP, the amounts of transfers between Levels 1 and 2 and transfers in and out of Level 3, if material, are disclosed in the Notes to Schedules of Investments for each respective Fund.
For fair valuations using significant unobservable inputs, U.S. GAAP requires a reconciliation of the beginning to ending balances for reported fair values that presents changes attributable to realized gain (loss), unrealized appreciation (depreciation), purchases and sales, accrued discounts (premiums), and transfers in and out of the Level 3 category during the period. The end of period timing recognition is used for the transfers between Levels of a Fund’s assets and liabilities. Additionally, U.S. GAAP requires quantitative information regarding the significant unobservable inputs used in the determination of fair value of assets or liabilities categorized as Level 3 in the fair value hierarchy. In accordance with the requirements of U.S. GAAP, a fair value hierarchy, and if material, a Level 3 reconciliation and details of significant unobservable inputs, have been included in the Notes to Schedules of Investments for each respective Fund.
(c) Valuation Techniques and the Fair Value Hierarchy
Level 1 and Level 2 trading assets and trading liabilities, at fair value The valuation methods (or “techniques”) and significant inputs used in determining the fair values of portfolio securities or other assets and liabilities categorized as Level 1 and Level 2 of the fair value hierarchy are as follows:
Common stocks, ETFs, exchange-traded notes and financial derivative instruments, such as futures contracts, rights and warrants, or options on futures that are traded on a national securities exchange, are stated at the last reported sale or settlement price on the day of valuation. To the extent these securities are actively traded and valuation adjustments are not applied, they are categorized as Level 1 of the fair value hierarchy.
Equity-linked securities are valued by referencing the last reported sale or settlement price of the linked referenced equity on the day of valuation. Foreign exchange adjustments are applied to the last reported price to convert the linked equity’s trading currency to the contract’s settling currency. These investments are categorized as Level 2 of the fair value hierarchy.
Investments in registered open-end investment companies (other than ETFs) will be valued based upon the NAVs of such investments and are categorized as Level 1 of the fair value hierarchy. Investments in unregistered open-end investment companies will be calculated based
upon the NAVs of such investments and are considered Level 1 provided that the NAVs are observable, calculated daily and are the value at which both purchases and sales will be conducted. Investments in privately held investment funds with significant restrictions on redemption where the inputs to the NAVs are observable will be valued based upon the NAVs of such investments and are categorized as Level 2 of the fair value hierarchy.
Equity exchange-traded options and over the counter financial derivative instruments, such as foreign currency contracts, options contracts, or swap agreements, derive their value from underlying asset prices, indices, reference rates, and other inputs or a combination of these factors. Other than swap agreements, which are valued using a broker-dealer bid quotation or on market-based prices provided by Pricing Services or other pricing sources, these contracts are normally valued on the basis of quotes obtained from a quotation reporting system, established market makers or Pricing Services (normally determined as of the NYSE Close). Depending on the product and the terms of the transaction, financial derivative instruments can be valued by Pricing Services using a series of techniques, including simulation pricing models. The pricing models use inputs that are observed from actively quoted markets such as quoted prices, issuer details, indices, bid/ask spreads, interest rates, implied volatilities, yield curves, dividends and exchange rates. Financial derivative instruments that use similar valuation techniques and inputs as described above are categorized as Level 2 of the fair value hierarchy.
Centrally cleared swaps listed or traded on a multilateral or trade facility platform, such as a registered exchange, are valued at the daily settlement price determined by the respective exchange (if available). For centrally cleared credit default swaps, the clearing facility requires its members to provide actionable price levels across complete term structures. These levels along with external third-party prices are used to produce daily settlement prices. These securities are categorized as Level 2 of the fair value hierarchy. Centrally cleared interest rate swaps are valued using a pricing model that references the underlying rates including the overnight index swap rate and London Interbank Offered Rate (“LIBOR”) forward rate to produce the daily settlement price. These securities are categorized as Level 2 of the fair value hierarchy.
Level 3 trading assets and trading liabilities, at fair value When a fair valuation method is applied by the Adviser that uses significant unobservable inputs, investments will be priced by a method that the Board or persons acting at their direction believe reflects fair value and are categorized as Level 3 of the fair value hierarchy.
The validity of the fair value is reviewed by the Adviser on a periodic basis and may be amended in accordance with the Trust’s valuation procedures.
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4. SECURITIES AND OTHER INVESTMENTS
(a) Investments in Affiliates
Each Fund seeks to achieve its investment objective by investing under normal circumstances substantially all of its assets in Institutional Class or Class M shares of any funds of the Trust and PIMCO Funds, and in other affiliated funds, including funds of PIMCO ETF Trust, except funds of funds (“Underlying PIMCO Funds”), and unaffiliated funds that are registered under the Act (collectively, “Acquired Funds”). The Underlying PIMCO Funds are considered to be affiliated with the Funds. Each Fund may also invest in the PIMCO Short-Term Floating NAV Portfolio III (“Central Fund”) to the extent permitted by the Act and rules thereunder. The Central Fund is a registered investment company created for use solely by the series of the Trust and series of the PIMCO Funds, PIMCO ETF Trust, PIMCO Equity Series VIT, and other series of registered investment companies advised by the Adviser, in connection with their cash management activities. The main investments of the Central Fund are money market and short maturity fixed income instruments. The Central Fund may incur expenses related to its investment activities, but does not pay Investment Advisory Fees or Supervisory and Administrative Fees to the Adviser. The Central Fund is considered to be affiliated with the Funds. The tables below show the Funds’ transactions in and earnings from investments in the affiliated Funds and/or Central Fund for the period ended December 31, 2015 (amounts in thousands†):
PIMCO RealPath™ Blend 2020 Fund | ||||||||||||||||||||||||||||||||||
Underlying PIMCO Funds | Market Value 06/30/2015 | Purchases at Cost | Proceeds from Sales | Net Realized Gain (Loss) | Change in Unrealized Appreciation (Depreciation) | Market Value 12/31/2015 | Dividend Income (1) | Realized Net Capital Gain Distributions (1) | ||||||||||||||||||||||||||
PIMCO Emerging Local Bond Fund | $ | 75 | $ | 13 | $ | (1 | ) | $ | 0 | $ | (12 | ) | $ | 75 | $ | 2 | $ | 0 | ||||||||||||||||
PIMCO Foreign Bond Fund (U.S. Dollar-Hedged) | 226 | 29 | (13 | ) | 0 | (13 | ) | 229 | 17 | 1 | ||||||||||||||||||||||||
PIMCO High Yield Fund | 153 | 18 | (5 | ) | 0 | (14 | ) | 152 | 4 | 4 | ||||||||||||||||||||||||
PIMCO Long Duration Total Return Fund | 224 | 28 | (11 | ) | (1 | ) | (12 | ) | 228 | 8 | 6 | |||||||||||||||||||||||
PIMCO Real Return Asset Fund | 301 | 24 | (7 | ) | 0 | (16 | ) | 302 | 5 | 0 | ||||||||||||||||||||||||
PIMCO Real Return Fund | 304 | 20 | (10 | ) | (1 | ) | (9 | ) | 304 | 2 | 0 | |||||||||||||||||||||||
PIMCO Total Return Fund | 459 | 48 | (24 | ) | 0 | (22 | ) | 461 | 8 | 16 | ||||||||||||||||||||||||
Totals | $ | 1,742 | $ | 180 | $ | (71 | ) | $ | (2 | ) | $ | (98 | ) | $ | 1,751 | $ | 46 | $ | 27 | |||||||||||||||
† A zero balance may reflect actual amounts rounding to less than one thousand. (1) A portion of this may be recharacterized to return of capital and reflected as such on tax forms mailed to shareholders on or about January 31st following each calendar year.
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PIMCO RealPath™ Blend 2025 Fund | ||||||||||||||||||||||||||||||||||
Underlying PIMCO Funds | Market Value 06/30/2015 | Purchases at Cost | Proceeds from Sales | Net Realized Gain (Loss) | Change in Unrealized Appreciation (Depreciation) | Market Value 12/31/2015 | Dividend Income (1) | Realized Net Distributions (1) | ||||||||||||||||||||||||||
PIMCO Emerging Local Bond Fund | $ | 76 | $ | 29 | $ | 0 | $ | 0 | $ | (14 | ) | $ | 91 | $ | 2 | $ | 0 | |||||||||||||||||
PIMCO Foreign Bond Fund (U.S. Dollar-Hedged) | 153 | 57 | (12 | ) | 0 | (12 | ) | 186 | 14 | 1 | ||||||||||||||||||||||||
PIMCO High Yield Fund | 232 | 82 | (11 | ) | 0 | (26 | ) | 277 | 8 | 7 | ||||||||||||||||||||||||
PIMCO Long Duration Total Return Fund | 226 | 82 | (15 | ) | (1 | ) | (14 | ) | 278 | 9 | 7 | |||||||||||||||||||||||
PIMCO Real Return Asset Fund | 304 | 94 | (12 | ) | (1 | ) | (19 | ) | 366 | 5 | 0 | |||||||||||||||||||||||
PIMCO Real Return Fund | 230 | 68 | (13 | ) | 0 | (8 | ) | 277 | 1 | 0 | ||||||||||||||||||||||||
PIMCO Total Return Fund | 233 | 79 | (18 | ) | 0 | (14 | ) | 280 | 5 | 10 | ||||||||||||||||||||||||
Totals | $ | 1,454 | $ | 491 | $ | (81 | ) | $ | (2 | ) | $ | (107 | ) | $ | 1,755 | $ | 44 | $ | 25 |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
(1) | A portion of this may be recharacterized to return of capital and reflected as such on tax forms mailed to shareholders on or about January 31st following each calendar year. |
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PIMCO RealPath™ Blend 2030 Fund | ||||||||||||||||||||||||||||||||||
Underlying PIMCO Funds | Market Value 06/30/2015 | Purchases at Cost | Proceeds from Sales | Net Realized Gain (Loss) | Change in Unrealized Appreciation (Depreciation) | Market Value 12/31/2015 | Dividend Income (1) | Realized Net Capital Gain Distributions (1) | ||||||||||||||||||||||||||
PIMCO Emerging Local Bond Fund | $ | 154 | $ | 21 | $ | (1 | ) | $ | 0 | $ | (24 | ) | $ | 150 | $ | 4 | $ | 0 | ||||||||||||||||
PIMCO Foreign Bond Fund (U.S. Dollar-Hedged) | 76 | 10 | (6 | ) | 0 | (4 | ) | 76 | 6 | 0 | ||||||||||||||||||||||||
PIMCO High Yield Fund | 230 | 29 | (11 | ) | 0 | (21 | ) | 227 | 7 | 6 | ||||||||||||||||||||||||
PIMCO Long Duration Total Return Fund | 225 | 31 | (16 | ) | (1 | ) | (12 | ) | 227 | 7 | 6 | |||||||||||||||||||||||
PIMCO Real Return Asset Fund | 303 | 26 | (12 | ) | (1 | ) | (16 | ) | 300 | 5 | 0 | |||||||||||||||||||||||
PIMCO Real Return Fund | 76 | 6 | (4 | ) | 0 | (2 | ) | 76 | 0 | 0 | ||||||||||||||||||||||||
PIMCO Total Return Fund | 77 | 10 | (6 | ) | 0 | (4 | ) | 77 | 1 | 3 | ||||||||||||||||||||||||
Totals | $ | 1,141 | $ | 133 | $ | (56 | ) | $ | (2 | ) | $ | (83 | ) | $ | 1,133 | $ | 30 | $ | 15 | |||||||||||||||
† A zero balance may reflect actual amounts rounding to less than one thousand. (1) A portion of this may be recharacterized to return of capital and reflected as such on tax forms mailed to shareholders on or about January 31st following each calendar year.
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PIMCO RealPath™ Blend 2035 Fund | ||||||||||||||||||||||||||||||||||
Underlying PIMCO Funds | Market Value 06/30/2015 | Purchases at Cost | Proceeds from Sales | Net Realized Gain (Loss) | Change in Unrealized Appreciation (Depreciation) | Market Value 12/31/2015 | Dividend Income (1) | Realized Net Capital Gain Distributions (1) | ||||||||||||||||||||||||||
PIMCO Emerging Local Bond Fund | $ | 155 | $ | 38 | $ | (1 | ) | $ | 0 | $ | (26 | ) | $ | 166 | $ | 4 | $ | 0 | ||||||||||||||||
PIMCO High Yield Fund | 156 | 37 | (10 | ) | 0 | (16 | ) | 167 | 5 | 4 | ||||||||||||||||||||||||
PIMCO Long Duration Total Return Fund | 228 | 57 | (18 | ) | (2 | ) | (14 | ) | 251 | 8 | 7 | |||||||||||||||||||||||
PIMCO Real Return Asset Fund | 305 | 59 | (14 | ) | (1 | ) | (17 | ) | 332 | 5 | 0 | |||||||||||||||||||||||
PIMCO Short-Term Floating NAV Portfolio III | 0 | 300 | (300 | ) | 0 | 0 | 0 | 0 | 0 | |||||||||||||||||||||||||
Totals | $ | 844 | $ | 491 | $ | (343 | ) | $ | (3 | ) | $ | (73 | ) | $ | 916 | $ | 22 | $ | 11 | |||||||||||||||
† A zero balance may reflect actual amounts rounding to less than one thousand. (1) A portion of this may be recharacterized to return of capital and reflected as such on tax forms mailed to shareholders on or about January 31st following each calendar year.
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PIMCO RealPath™ Blend 2040 Fund | ||||||||||||||||||||||||||||||||||
Underlying PIMCO Funds | Market Value 06/30/2015 | Purchases at Cost | Proceeds from Sales | Net Realized Gain (Loss) | Change in Unrealized Appreciation (Depreciation) | Market Value 12/31/2015 | Dividend Income (1) | Realized Net Capital Gain Distributions (1) | ||||||||||||||||||||||||||
PIMCO Emerging Local Bond Fund | $ | 77 | $ | 8 | $ | 0 | $ | 0 | $ | (12 | ) | $ | 73 | $ | 2 | $ | 0 | |||||||||||||||||
PIMCO High Yield Fund | 156 | 16 | (9 | ) | 0 | (14 | ) | 149 | 4 | 4 | ||||||||||||||||||||||||
PIMCO Long Duration Total Return Fund | 228 | 26 | (18 | ) | (1 | ) | (11 | ) | 224 | 8 | 6 | |||||||||||||||||||||||
PIMCO Real Return Asset Fund | 229 | 14 | (10 | ) | (1 | ) | (11 | ) | 221 | 3 | 0 | |||||||||||||||||||||||
Totals | $ | 690 | $ | 64 | $ | (37 | ) | $ | (2 | ) | $ | (48 | ) | $ | 667 | $ | 17 | $ | 10 | |||||||||||||||
† A zero balance may reflect actual amounts rounding to less than one thousand. (1) A portion of this may be recharacterized to return of capital and reflected as such on tax forms mailed to shareholders on or about January 31st following each calendar year.
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PIMCO RealPath™ Blend 2045 Fund | ||||||||||||||||||||||||||||||||||
Underlying PIMCO Funds | Market Value 06/30/2015 | Purchases at Cost | Proceeds from Sales | Net Realized Gain (Loss) | Change in Unrealized Appreciation (Depreciation) | Market Value 12/31/2015 | Dividend Income (1) | Realized Net Capital Gain Distributions (1) | ||||||||||||||||||||||||||
PIMCO Emerging Local Bond Fund | $ | 78 | $ | 9 | $ | (1 | ) | $ | 0 | $ | (12 | ) | $ | 74 | $ | 2 | $ | 0 | ||||||||||||||||
PIMCO High Yield Fund | 79 | 8 | (5 | ) | 0 | (7 | ) | 75 | 2 | 2 | ||||||||||||||||||||||||
PIMCO Long Duration Total Return Fund | 230 | 30 | (20 | ) | (1 | ) | (12 | ) | 227 | 8 | 6 | |||||||||||||||||||||||
PIMCO Real Return Asset Fund | 154 | 13 | (8 | ) | (1 | ) | (8 | ) | 150 | 2 | 0 | |||||||||||||||||||||||
Totals | $ | 541 | $ | 60 | $ | (34 | ) | $ | (2 | ) | $ | (39 | ) | $ | 526 | $ | 14 | $ | 8 |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
(1) | A portion of this may be recharacterized to return of capital and reflected as such on tax forms mailed to shareholders on or about January 31st following each calendar year. |
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PIMCO RealPath™ Blend 2050 Fund | ||||||||||||||||||||||||||||||||||
Underlying PIMCO Funds | Market Value 06/30/2015 | Purchases at Cost | Proceeds from Sales | Net Realized Gain (Loss) | Change in Unrealized Appreciation (Depreciation) | Market Value 12/31/2015 | Dividend Income (1) | Realized Net Capital Gain Distributions (1) | ||||||||||||||||||||||||||
PIMCO Emerging Local Bond Fund | $ | 77 | $ | 8 | $ | 0 | $ | 0 | $ | (11 | ) | $ | 74 | $ | 2 | $ | 0 | |||||||||||||||||
PIMCO High Yield Fund | 77 | 8 | (3 | ) | 0 | (7 | ) | 75 | 2 | 2 | ||||||||||||||||||||||||
PIMCO Long Duration Total Return Fund | 229 | 29 | (18 | ) | (1 | ) | (12 | ) | 227 | 8 | 6 | |||||||||||||||||||||||
PIMCO Real Return Asset Fund | 77 | 5 | (3 | ) | 0 | (4 | ) | 75 | 1 | 0 | ||||||||||||||||||||||||
Totals | $ | 460 | $ | 50 | $ | (24 | ) | $ | (1 | ) | $ | (34 | ) | $ | 451 | $ | 13 | $ | 8 | |||||||||||||||
† A zero balance may reflect actual amounts rounding to less than one thousand. (1) A portion of this may be recharacterized to return of capital and reflected as such on tax forms mailed to shareholders on or about January 31st following each calendar year.
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PIMCO RealPath™ Blend 2055 Fund | ||||||||||||||||||||||||||||||||||
Underlying PIMCO Funds | Market Value 06/30/2015 | Purchases at Cost | Proceeds from Sales | Net Realized Gain (Loss) | Change in Unrealized Appreciation (Depreciation) | Market Value 12/31/2015 | Dividend Income (1) | Realized Net Capital Gain Distributions (1) | ||||||||||||||||||||||||||
PIMCO Emerging Local Bond Fund | $ | 78 | $ | 7 | $ | (1 | ) | $ | 0 | $ | (11 | ) | $ | 73 | $ | 2 | $ | 0 | ||||||||||||||||
PIMCO High Yield Fund | 79 | 6 | (4 | ) | 0 | (7 | ) | 74 | 2 | 2 | ||||||||||||||||||||||||
PIMCO Long Duration Total Return Fund | 233 | 27 | (23 | ) | (2 | ) | (11 | ) | 224 | 8 | 6 | |||||||||||||||||||||||
PIMCO Real Return Asset Fund | 78 | 4 | (4 | ) | 0 | (4 | ) | 74 | 1 | 0 | ||||||||||||||||||||||||
Totals | $ | 468 | $ | 44 | $ | (32 | ) | $ | (2 | ) | $ | (33 | ) | $ | 445 | $ | 13 | $ | 8 | |||||||||||||||
† A zero balance may reflect actual amounts rounding to less than one thousand. (1) A portion of this may be recharacterized to return of capital and reflected as such on tax forms mailed to shareholders on or about January 31st following each calendar year.
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PIMCO RealPath™ Blend Income Fund | ||||||||||||||||||||||||||||||||||
Underlying PIMCO Funds | Market Value 06/30/2015 | Purchases at Cost | Proceeds from Sales | Net Realized Gain (Loss) | Change in Unrealized Appreciation (Depreciation) | Market Value 12/31/2015 | Dividend Income (1) | Realized Net Capital Gain Distributions (1) | ||||||||||||||||||||||||||
PIMCO Emerging Local Bond Fund | $ | 76 | $ | 13 | $ | (1 | ) | $ | 0 | $ | (12 | ) | $ | 76 | $ | 2 | $ | 0 | ||||||||||||||||
PIMCO Foreign Bond Fund (U.S. Dollar-Hedged) | 309 | 42 | (23 | ) | 0 | (18 | ) | 310 | 24 | 1 | ||||||||||||||||||||||||
PIMCO High Yield Fund | 77 | 9 | (2 | ) | 0 | (7 | ) | 77 | 2 | 2 | ||||||||||||||||||||||||
PIMCO Long Duration Total Return Fund | 228 | 32 | (16 | ) | (1 | ) | (12 | ) | 231 | 8 | 6 | |||||||||||||||||||||||
PIMCO Real Return Asset Fund | 229 | 21 | (9 | ) | 0 | (12 | ) | 229 | 3 | 0 | ||||||||||||||||||||||||
PIMCO Real Return Fund | 466 | 27 | (16 | ) | (1 | ) | (14 | ) | 462 | 3 | 0 | |||||||||||||||||||||||
PIMCO Short-Term Floating NAV Portfolio III | 100 | 58 | 0 | 0 | (1 | ) | 157 | 1 | 0 | |||||||||||||||||||||||||
PIMCO Total Return Fund | 467 | 48 | (25 | ) | (1 | ) | (22 | ) | 467 | 8 | 16 | |||||||||||||||||||||||
Totals | $ | 1,952 | $ | 250 | $ | (92 | ) | $ | (3 | ) | $ | (98 | ) | $ | 2,009 | $ | 51 | $ | 25 |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
(1) | A portion of this may be recharacterized to return of capital and reflected as such on tax forms mailed to shareholders on or about January 31st following each calendar year. |
(b) Investments in Securities
U.S. Government Agencies or Government-Sponsored Enterprises Certain Funds may invest in securities of U.S. Government agencies or government-sponsored enterprises. U.S. Government securities are obligations of and, in certain cases, guaranteed by, the U.S. Government, its agencies or instrumentalities. Some U.S. Government securities, such as Treasury bills, notes and bonds, and securities guaranteed by the Government National Mortgage Association (“GNMA” or “Ginnie Mae”), are supported by the full faith and credit of the U.S. Government; others, such as those of the Federal Home Loan Banks, are supported by the right of the issuer to borrow
from the U.S. Department of the Treasury (the “U.S. Treasury”); and others, such as those of the Federal National Mortgage Association (“FNMA” or “Fannie Mae”), are supported by the discretionary authority of the U.S. Government to purchase the agency’s obligations. U.S. Government securities may include zero coupon securities. Zero coupon securities do not distribute interest on a current basis and tend to be subject to a greater risk than interest-paying securities.
Government-related guarantors (i.e., not backed by the full faith and credit of the U.S. Government) include FNMA and the Federal Home Loan Mortgage Corporation (“FHLMC” or “Freddie Mac”). FNMA is a
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government-sponsored corporation. FNMA purchases conventional (i.e., not insured or guaranteed by any government agency) residential mortgages from a list of approved seller/servicers which include state and federally chartered savings and loan associations, mutual savings banks, commercial banks and credit unions and mortgage bankers. Pass-through securities issued by FNMA are guaranteed as to timely payment of principal and interest by FNMA, but are not backed by the full faith and credit of the U.S. Government. FHLMC issues Participation Certificates (“PCs”), which are pass-through securities, each representing an undivided interest in a pool of residential mortgages. FHLMC guarantees the timely payment of interest and ultimate collection of principal, but PCs are not backed by the full faith and credit of the U.S. Government.
5. FINANCIAL DERIVATIVE INSTRUMENTS
The following disclosures contain information on how and why the Funds use financial derivative instruments, and how financial derivative instruments affect the Funds’ financial position, results of operations and cash flows. The location and fair value amounts of these instruments on the Statements of Assets and Liabilities and the net realized gain (loss) and net change in unrealized appreciation (depreciation) on the Statements of Operations, each categorized by type of financial derivative contract and related risk exposure, are included in a table in the Notes to Schedules of Investments. The financial derivative instruments outstanding as of period end and the amounts of net realized gain (loss) and net change in unrealized appreciation (depreciation) on financial derivative instruments during the period, as disclosed in the Notes to Schedules of Investments, serve as indicators of the volume of financial derivative activity for the Funds.
(a) Options Contracts Certain Funds may write or purchase options to enhance returns or to hedge an existing position or future investment. A Fund may write call and put options on securities and financial derivative instruments they own or in which they may invest. Writing put options tends to increase a Fund’s exposure to the underlying instrument. Writing call options tends to decrease a Fund’s exposure to the underlying instrument. When a Fund writes a call or put, an amount equal to the premium received is recorded as a liability and subsequently marked to market to reflect the current value of the option written. These liabilities are included on the Statements of Assets and Liabilities. Premiums received from writing options which expire are treated as realized gains. Premiums received from writing options which are exercised or closed are added to the proceeds or offset against amounts paid on the underlying futures, swap, security or currency transaction to determine the realized gain or loss. Certain options may be written with premiums to be determined on a future date. The premiums for these options are based upon implied volatility parameters at specified terms. A Fund as a writer of an option has no
control over whether the underlying instrument may be sold (“call”) or purchased (“put”) and as a result bears the market risk of an unfavorable change in the price of the instrument underlying the written option. There is the risk a Fund may not be able to enter into a closing transaction because of an illiquid market.
Certain Funds may also purchase put and call options. Purchasing call options tends to increase a Fund’s exposure to the underlying instrument. Purchasing put options tends to decrease a Fund’s exposure to the underlying instrument. A Fund pays a premium which is included as an asset on the Statements of Assets and Liabilities and subsequently marked to market to reflect the current value of the option. Premiums paid for purchasing options which expire are treated as realized losses. Certain options may be purchased with premiums to be determined on a future date. The premiums for these options are based upon implied volatility parameters at specified terms. The risk associated with purchasing put and call options is limited to the premium paid. Premiums paid for purchasing options which are exercised or closed are added to the amounts paid or offset against the proceeds on the underlying investment transaction to determine the realized gain or loss when the underlying transaction is executed.
Options on Indices Certain Funds may write or purchase options on indices (“Index Option”). An Index Option uses a specified index as the underlying instrument for the option contract. The exercise for an Index Option will not include physical delivery of the underlying index but will result in a cash transfer of the amount of the difference between the settlement price of the underlying index and the strike price.
(b) Swap Agreements Certain Funds may invest in swap agreements. Swap agreements are bilaterally negotiated agreements between a Fund and a counterparty to exchange or swap investment cash flows, assets, foreign currencies or market-linked returns at specified, future intervals. Swap agreements may be privately negotiated in the over the counter market (“OTC swaps”) or may be cleared through a third party, known as a central counterparty or derivatives clearing organization (“Centrally Cleared Swaps”). A Fund may enter into asset, credit default, cross-currency, interest rate, total return, variance and other forms of swap agreements to manage its exposure to credit, currency, interest rate, commodity, equity and inflation risk. In connection with these agreements, securities or cash may be identified as collateral or margin in accordance with the terms of the respective swap agreements to provide assets of value and recourse in the event of default or bankruptcy/insolvency.
Centrally Cleared Swaps are marked to market daily based upon valuations as determined from the underlying contract or in accordance with the requirements of the central counterparty or derivatives clearing organization. Changes in market value, if any, are reflected as a
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component of net change in unrealized appreciation (depreciation) on the Statements of Operations. Daily changes in valuation of centrally cleared swaps (“Swap Variation Margin”), if any, are included within centrally cleared financial derivative instruments on the Statements of Assets and Liabilities. OTC swap payments received or paid at the beginning of the measurement period are included on the Statements of Assets and Liabilities and represent premiums paid or received upon entering into the swap agreement to compensate for differences between the stated terms of the swap agreement and prevailing market conditions (credit spreads, currency exchange rates, interest rates, and other relevant factors). Upfront premiums received (paid) are initially recorded as liabilities (assets) and subsequently marked to market to reflect the current value of the swap. These upfront premiums are recorded as realized gains or losses on the Statements of Operations upon termination or maturity of the swap. A liquidation payment received or made at the termination of the swap is recorded as realized gain or loss on the Statements of Operations. Net periodic payments received or paid by a Fund are included as part of realized gains or losses on the Statements of Operations.
Entering into these agreements involves, to varying degrees, elements of interest, credit, market and documentation risk in excess of the amounts recognized on the Statements of Assets and Liabilities. Such risks involve the possibility that there will be no liquid market for these agreements, that the counterparty to the agreements may default on its obligation to perform or disagree as to the meaning of contractual terms in the agreements and that there may be unfavorable changes in interest rates.
A Fund’s maximum risk of loss from counterparty credit risk is the discounted net value of the cash flows to be received from the counterparty over the contract’s remaining life, to the extent that amount is positive. The risk is mitigated by having a master netting arrangement between a Fund and the counterparty and by the posting of collateral to a Fund to cover a Fund’s exposure to the counterparty.
Total Return Swap Agreements Certain Funds may enter into total return swap agreements to gain or mitigate exposure to the underlying reference. Total return swap agreements involve commitments where single or multiple cash flows are exchanged based on the price of an underlying reference and on a fixed or variable interest rate. Total return swap agreements may involve commitments to pay interest in exchange for a market-linked return. One counterparty pays out the total return of a specific reference asset, which may include an underlying equity, index, or bond, and in return receives a fixed or variable rate. At the maturity date, a net cash flow is exchanged where the total return is equivalent to the return of the underlying reference less a financing rate, if any. As a receiver, a Fund would receive payments based on any net positive total return and would owe payments in the event of a net negative total return. As the payer, a
Fund would owe payments on any net positive total return, and would receive payments in the event of a net negative total return.
6. PRINCIPAL RISKS
In the normal course of business, the Funds (or Acquired Funds) trade financial instruments and enter into financial transactions where risk of potential loss exists due to such things as changes in the market (market risk) or failure or inability of the other party to a transaction to perform (credit and counterparty risk). See below for a detailed description of select principal risks. For a more comprehensive list of potential risks the Funds may be subject to, please see the Important Information About the Funds.
Investments in Mutual Funds To the extent that certain Funds invest substantially all of their respective assets in Acquired Funds, the risks associated with investing in these Funds will be closely related to the risks associated with the securities and other investments held by the Acquired Funds. The ability of the Funds to achieve their respective investment objectives may depend upon the ability of the Acquired Funds to achieve their respective investment objectives. There can be no assurance that the investment objective of any Acquired Fund will be achieved. The NAV of each Fund will fluctuate in response to changes in the respective NAV of the Acquired Funds in which it invests. The extent to which the investment performance and risks associated with the Funds correlate to those of a particular Acquired Fund will depend upon the extent to which the assets of the Funds are allocated from time to time for investment in the Acquired Funds, which will vary.
Certain Funds’ investment performance depends upon how each Fund’s assets are allocated and reallocated according to each Fund’s asset allocation targets and ranges. A principal risk of investing in each Fund is that the Funds’ asset allocation sub-adviser will make less than optimal or poor asset allocation decisions. The asset allocation sub-adviser attempts to identify investment allocations for the Acquired Funds that will provide consistent, quality performance for the Funds, but there is no guarantee that such allocation techniques will produce the desired results.
Market Risks A Fund’s (or Acquired Funds’) investments in financial derivative instruments and other financial instruments expose the Fund to various risks such as, but not limited to, interest rate, foreign currency, equity and commodity risks.
The market values of equities, such as common stocks and preferred securities or equity related investments such as futures and options, have historically risen and fallen in periodic cycles and may decline due to general market conditions which are not specifically related to a particular company, such as real or perceived adverse economic conditions, changes in the general outlook for corporate earnings,
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changes in interest or currency rates or adverse investor sentiment generally. They may also decline due to factors which affect a particular industry or industries, such as labor shortages or increased production costs and competitive conditions within an industry. Different types of equity securities may react differently to these developments. Equity securities and equity related investments generally have greater market price volatility than fixed income securities.
Issuers that have paid regular dividends or distributions to shareholders may not continue to do so in the future. An issuer may reduce or eliminate future dividends or distributions at any time and for any reason. Moreover, a Fund may use a dividend capture strategy (i.e., purchasing an equity security shortly before the issuer pays a dividend and selling it shortly thereafter) which may expose the Fund to higher portfolio turnover, increased trading costs and potential for capital loss or gain, particularly in the event of significant short-term price movements of stocks subject to dividend capture trading. Also, securities purchased to capture a dividend often decline in value at the same time of sale (i.e., shortly following the dividends and the resulting realize loss to the Fund may exceed the amount of the dividend received, thereby negatively impacting the Fund’s net asset value.
Interest rate risk is the risk that fixed income securities will decline in value because of an increase in interest rates. As nominal interest rates rise, the value of certain fixed income securities held by a Fund (or Acquired Funds) is likely to decrease. A nominal interest rate can be described as the sum of a real interest rate and an expected inflation rate. Interest rate changes can be sudden and unpredictable, and a Fund (or Acquired Funds) may lose money if these changes are not anticipated by the Fund’s (or Acquired Funds) management. A Fund (or Acquired Funds) may not be able to hedge against changes in interest rates or may choose not to do so for cost or other reasons. In addition, any hedges may not work as intended.
Duration is a measure of the sensitivity of a fixed income security’s market price to interest rate (i.e., yield) movements that incorporates a security’s yield, coupon, final maturity and call features, among other characteristics. Convexity is an additional measure of interest rate sensitivity that measures the rate of change of duration in response to changes in interest rates. Fixed income securities with longer durations tend to be more sensitive to changes in interest rates, usually making them more volatile than securities with shorter durations. A wide variety of factors can cause interest rates to rise (e.g., central bank monetary policies, inflation rates, general economic conditions). At present, the U.S. is experiencing historically low interest rates. The Funds may be subject to heightened interest rate risk because the Fed has ended its quantitative easing program and has begun, and may continue, to raise interest rates. Further, while U.S. bond markets have steadily grown over the past three decades, dealer “market making”
ability has remained relatively stagnant. Given the importance of intermediary “market making” in creating a robust and active market, fixed income securities are currently facing increased volatility and liquidity risks. All of these factors, collectively and/or individually, could cause a Fund (or Acquired Funds) to lose value. If a Fund (or Acquired Funds) lost enough value, the Fund (or Acquired Funds) could face increased redemptions by shareholders, which could further impair its performance.
To the extent that a Fund (or Acquired Fund) may invest in securities and instruments that are economically tied to Russia, the Fund (or Acquired Fund) is subject to various risks such as, but not limited to political, economic, legal, market and currency risks. The risks include uncertain political and economic policies, short-term market volatility, poor accounting standards, corruption and crime, an inadequate regulatory system, and unpredictable taxation. Investments in Russia are particularly subject to the risk that further economic sanctions may be imposed by the United States and/or other countries. Such sanctions — which may impact companies in many sectors, including energy, financial services and defense, among others — may negatively impact a Fund’s (or Acquired Fund’s) performance and/or ability to achieve its investment objective. The Russian securities market, as compared to U.S. markets, has significant price volatility, less liquidity, difficulties in obtaining accurate prices, a smaller market capitalization and a smaller number of traded securities. Settlement, clearing and registration of securities transactions are subject to risks, which may result in significant delays or problems in registering the transfer of securities, including issues with foreign nominee accounts held with custodian banks. It is possible that the ownership rights of a Fund (or Acquired Fund) could be lost through fraud or negligence. In addition, it may be difficult for a Fund (or Acquired Fund) to enforce any rights it may have in the event of loss of share registration. Adverse currency exchange rates are a risk and there may be a lack of available currency hedging instruments. Investments in Russia may be subject to the risk of nationalization or expropriation of assets. Oil, natural gas, metals, and timber account for a significant portion of Russia’s exports, leaving the country vulnerable to swings in world prices.
If a Fund (or Acquired Funds) invests directly in foreign (non-U.S.) currencies or in securities that trade in, and receive revenues in, foreign (non-U.S.) currencies, or in financial derivative instruments that provide exposure to foreign (non-U.S.) currencies, it will be subject to the risk that those currencies will decline in value relative to the base currency of the Fund (or Acquired Funds), or, in the case of hedging positions, that the Fund’s (or Acquired Funds’) base currency will decline in value relative to the currency being hedged. Currency rates in foreign countries may fluctuate significantly over short periods of time for a number of reasons, including changes in interest rates, intervention (or
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the failure to intervene) by U.S. or foreign governments, central banks or supranational entities such as the International Monetary Fund, or by the imposition of currency controls or other political developments in the United States or abroad. As a result, a Fund’s (or Acquired Funds’) investments in foreign currency-denominated securities may reduce the Fund’s (or Acquired Funds) returns.
A Fund’s (or Acquired Funds’) investments in commodity-linked financial derivative instruments may subject the Fund (or Acquired Funds) to greater market price volatility than investments in traditional securities. The value of commodity-linked financial derivative instruments may be affected by changes in overall market movements, commodity index volatility, changes in interest rates, or factors affecting a particular industry or commodity, such as drought, floods, weather, livestock disease, embargoes, tariffs and international economic, political and regulatory developments.
Credit and Counterparty Risks A Fund (or Acquired Funds) will be exposed to credit risk to parties with whom it trades and will also bear the risk of settlement default. A Fund (or Acquired Funds) minimizes concentrations of credit risk by undertaking transactions with a large number of customers and counterparties on recognized and reputable exchanges, where applicable. For financial derivative instruments traded on exchanges or clearinghouses, the primary credit risk is the creditworthiness of a Fund’s clearing broker or the exchange or clearinghouse itself. A Fund (or Acquired Funds) could lose money if the issuer or guarantor of a fixed income security, or the counterparty to a financial derivative instruments contract, repurchase agreement or a loan of portfolio securities, is unable or unwilling to make timely principal and/or interest payments, or to otherwise honor its obligations. Securities and financial derivative instruments are subject to varying degrees of credit risk, which may be reflected in credit ratings.
Similar to credit risk, a Fund (or Acquired Funds) may be exposed to counterparty risk, or the risk that an institution or other entity with which the Fund (or Acquired Funds) has unsettled or open transactions will default. PIMCO, as the Adviser, minimizes counterparty risks to the Funds (or Acquired Funds) through a number of ways. Prior to entering into transactions with a new counterparty, the PIMCO Counterparty Risk Committee conducts an extensive credit review of such counterparty and must approve the use of such counterparty. Furthermore, pursuant to the terms of the underlying contract, to the extent that unpaid amounts owed to a Fund (or Acquired Funds) exceed a predetermined threshold, such counterparty shall advance collateral to the Fund (or Acquired Funds) in the form of cash or securities equal in value to the unpaid amount owed to the Fund (or Acquired Funds). A Fund (or Acquired Funds) may invest such collateral in securities or other instruments and will typically pay interest to the counterparty on the collateral received. If the unpaid amount owed to a
Fund (or Acquired Funds) subsequently decreases, the Fund (or Acquired Funds) would be required to return to the counterparty all or a portion of the collateral previously advanced.
All transactions in listed securities are settled/paid for upon delivery using approved counterparties. The risk of default is considered minimal, as delivery of securities sold is only made once a Fund (or Acquired Funds) has received payment. Payment is made on a purchase once the securities have been delivered by the counterparty. The trade will fail if either party fails to meet its obligation.
Master Netting Arrangements A Fund may be subject to various netting arrangements (“Master Agreements”) with select counterparties. Master Agreements govern the terms of certain transactions, and reduce the counterparty risk associated with relevant transactions by specifying credit protection mechanisms and providing standardization that improves legal certainty. Each type of Master Agreement governs certain types of transactions. Different types of transactions may be traded out of different legal entities or affiliates of a particular organization, resulting in the need for multiple agreements with a single counterparty. As the Master Agreements are specific to unique operations of different asset types, they allow a Fund to close out and net its total exposure to a counterparty in the event of a default with respect to all the transactions governed under a single Master Agreement with a counterparty. For financial reporting purposes the Statements of Assets and Liabilities generally present derivative assets and liabilities on a gross basis, which reflects the full risks and exposures prior to netting.
Master Agreements can also help limit counterparty risk by specifying collateral posting arrangements at pre-arranged exposure levels. Under most Master Agreements, collateral is routinely transferred if the total net exposure to certain transactions (net of existing collateral already in place) governed under the relevant Master Agreement with a counterparty in a given account exceeds a specified threshold, which typically ranges from zero to $250,000 depending on the counterparty and the type of Master Agreement. United States Treasury Bills and U.S. dollar cash are generally the preferred forms of collateral, although other forms of AAA rated paper or sovereign securities may be used depending on the terms outlined in the applicable Master Agreement. Securities and cash pledged as collateral are reflected as assets on the Statements of Assets and Liabilities as either a component of Investments at value (securities) or Deposits with counterparty. Cash collateral received is not typically held in a segregated account and as such is reflected as a liability on the Statements of Assets and Liabilities as Deposits from counterparty. The market value of any securities received as collateral is not reflected as a component of NAV. A Fund’s overall exposure to counterparty risk can change substantially within a short period, as it is affected by each transaction subject to the relevant Master Agreement.
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Master Repurchase Agreements and Global Master Repurchase Agreements (individually and collectively “Master Repo Agreements”) govern repurchase, reverse repurchase, and sale-buyback transactions between a Fund and select counterparties. Master Repo Agreements maintain provisions for, among other things, initiation, income payments, events of default, and maintenance of collateral. The market value of transactions under the Master Repo Agreement, collateral pledged or received, and the net exposure by counterparty as of period end are disclosed in the Notes to Schedules of Investments.
Master Securities Forward Transaction Agreements (“Master Forward Agreements”) govern certain forward settling transactions, such as To-Be-Announced securities, delayed-delivery or sale-buyback transactions by and between a Fund and select counterparties. The Master Forward Agreements maintain provisions for, among other things, initiation and confirmation, payment and transfer, events of default, termination, and maintenance of collateral. The market value of forward settling transactions, collateral pledged or received, and the net exposure by counterparty as of period end is disclosed in the Notes to Schedules of Investments.
Customer Account Agreements and related addenda govern cleared derivatives transactions such as futures, options on futures, and cleared over the counter (“OTC”) derivatives. Such transactions require posting of initial margin as determined by each relevant clearing agency which is segregated in an account at a futures commission merchant (“FCM”) registered with the Commodity Futures Trading Commission (“CFTC”). In the United States, counterparty risk is significantly reduced as creditors of an FCM cannot have a claim to Fund assets in the segregated account. Additionally, portability of exposure in the event of an FCM default scenario further reduces risk to the Funds. Variation margin, or changes in market value, are exchanged daily, but may not be netted between futures and cleared OTC derivatives. The market value or accumulated unrealized appreciation (depreciation), initial margin posted, and any unsettled variation margin as of period end is disclosed in the Notes to Schedules of Investments.
International Swaps and Derivatives Association, Inc. Master Agreements and Credit Support Annexes (“ISDA Master Agreements”) govern bilateral OTC derivative transactions entered into by a Fund with select counterparties. ISDA Master Agreements maintain provisions for general obligations, representations, agreements, collateral and events of default or termination. Events of termination include conditions that may entitle counterparties to elect to terminate early and cause settlement of all outstanding transactions under the applicable ISDA Master Agreement. Any election to terminate early could be material to the financial statements. In limited circumstances, the ISDA Master Agreement may contain additional provisions that add counterparty protection beyond coverage of existing daily exposure if the counterparty has a decline in credit quality below a predefined level. These amounts, if any, may be segregated with a third-party custodian. The market value of OTC financial derivative instruments, collateral received or pledged, and net exposure by counterparty as of period end are disclosed in the Notes to Schedules of Investments.
7. FEES AND EXPENSES
(a) Investment Advisory Fee PIMCO is a majority-owned subsidiary of Allianz Asset Management of America L.P. (“Allianz Asset Management”) and serves as the Adviser to the Trust, pursuant to an investment advisory contract. The Adviser receives a monthly fee from each Fund at an annual rate based on average daily net assets (the “Investment Advisory Fee”). The Investment Advisory Fee for all classes is charged at an annual rate as noted in the table below.
(b) Supervisory and Administrative Fee PIMCO serves as administrator (the “Administrator”) and provides supervisory and administrative services to the Trust for which it receives a monthly supervisory and administrative fee based on each share class’s average daily net assets (the “Supervisory and Administrative Fee”). As the Administrator, PIMCO bears the costs of various third-party services, including audit, custodial, portfolio accounting, legal, transfer agency and printing costs.
The Investment Advisory Fees and Supervisory and Administrative Fees for all classes are charged at an annual rate as noted in the following table:
Investment Advisory Fee | Supervisory and Administrative Fee | |||||||||||||||||||
Fund Name | All Classes | Institutional Class | Administrative Class | Class A | ||||||||||||||||
PIMCO RealPath™ Blend 2020 Fund | 0.01% | 0.02% | 0.02% | 0.27% | ||||||||||||||||
PIMCO RealPath™ Blend 2025 Fund | 0.01% | 0.02% | 0.02% | 0.27% | ||||||||||||||||
PIMCO RealPath™ Blend 2030 Fund | 0.02% | 0.02% | 0.02% | 0.27% | ||||||||||||||||
PIMCO RealPath™ Blend 2035 Fund | 0.03% | 0.02% | 0.02% | 0.27% | ||||||||||||||||
PIMCO RealPath™ Blend 2040 Fund | 0.03% | 0.02% | 0.02% | 0.27% | ||||||||||||||||
PIMCO RealPath™ Blend 2045 Fund | 0.03% | 0.02% | 0.02% | 0.27% | ||||||||||||||||
PIMCO RealPath™ Blend 2050 Fund | 0.03% | 0.02% | 0.02% | 0.27% | ||||||||||||||||
PIMCO RealPath™ Blend 2055 Fund | 0.03% | 0.02% | 0.02% | 0.27% | ||||||||||||||||
PIMCO RealPath™ Blend Income Fund | 0.01% | 0.02% | 0.02% | 0.27% |
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(c) Distribution and Servicing Fees PIMCO Investments LLC (“PI”), a wholly-owned subsidiary of PIMCO, serves as the distributor (“Distributor”) of the Trust’s shares.
The Trust has adopted separate Distribution and Servicing Plans with respect to the Class A, Class C and Class R shares of the Trust pursuant to Rule 12b-1 under the Act. In connection with the distribution of Class C and Class R shares of the Trust, the Distributor receives distribution fees from the Trust of up to 0.75% for Class C shares and 0.25% for Class R shares, and in connection with personal services rendered to Class A, Class C and Class R shareholders and the maintenance of such shareholder accounts, the Distributor receives servicing fees from the Trust of up to 0.25% for each of Class A, Class C and Class R shares (percentages reflect annual rates of the average daily net assets attributable to the applicable class).
The Trust has adopted a Distribution and Servicing Plan with respect to the Class D shares of each Fund pursuant to Rule 12b-1 under the Act (the “Class D Plan”). Under the terms of the Class D Plan, a Fund is permitted to compensate the Distributor out of the assets attributable to the Class D shares of the Fund, in an amount up to 0.25% on an annual basis of the average daily net assets of the Fund’s Class D shares for providing, or procuring through financial intermediaries, distribution, shareholder services, and/or maintenance of shareholder accounts with respect to Class D shareholders of the Fund, some of which may be deemed to be primarily intended to result in the sale of Class D shares.
The Trust has adopted a Distribution and Servicing Plan with respect to the Administrative Class shares of each Fund pursuant to Rule 12b-1 under the Act (the “Administrative Class Plan”). Under the terms of the Administrative Class Plan, a Fund may compensate the Distributor for providing, or procuring through financial intermediaries, distribution, administrative, recordkeeping, shareholder and/or related services with respect to Administrative Class shares. The Administrative Class Plan permits a Fund to make total payments at an annual rate of up to 0.25% of the average daily net assets attributable to the Administrative Class shares.
The Trust paid distribution and servicing fees at effective rates as set forth in the following table (calculated as a percentage of each Fund’s average daily net assets attributable to each class):
Distribution Fee | Servicing Fee | |||||||||
Administrative Class | — | 0.25% | ||||||||
Class D | — | 0.25% | ||||||||
Class A | — | 0.25% | ||||||||
Class C | 0.75% | 0.25% | ||||||||
Class R | 0.25% | 0.25% |
The Distributor also received the proceeds of the initial sales charges paid by the shareholders upon the purchase of Class A shares and the contingent deferred sales charges paid by the shareholders upon certain redemptions of Class A and Class C shares. For the period ended December 31, 2015, the Distributor retained $108,108 representing commissions (sales charges) and contingent deferred sales charges from the Trust.
(d) Fund Expenses PIMCO provides or procures supervisory and administrative services for shareholders and also bears the costs of various third-party services required by the Funds, including audit, custodial, portfolio accounting, legal, transfer agency and printing costs. The Trust is responsible for the following expenses: (i) taxes and governmental fees; (ii) brokerage fees and commissions and other portfolio transaction expenses; (iii) the costs of borrowing money, including interest expense; (iv) fees and expenses of the Trustees who are not “interested persons” of PIMCO or the Trust, and any counsel retained exclusively for their benefit; (v) extraordinary expense, including costs of litigation and indemnification expenses; (vi) organizational expenses; and (vii) any expenses allocated or allocable to a specific class of shares, which include service fees payable with respect to the Administrative Class Shares, and may include certain other expenses as permitted by the Trust’s Multi-Class Plan adopted pursuant to Rule 18f-3 under the Act and subject to review and approval by the Trustees. The ratio of expenses to average net assets per share class, as disclosed on the Financial Highlights, may differ from the annual fund operating expenses per share class as disclosed in the Prospectus.
Each unaffiliated Trustee receives an annual retainer of $62,000, plus $6,250 for each Board meeting attended in person, $375 ($750 in the case of the audit committee chair with respect to audit committee meetings) for each committee meeting attended and $750 for each Board meeting attended telephonically, plus reimbursement of related expenses. In addition, the audit committee chair receives an additional annual retainer of $9,000, the valuation oversight committee lead receives an additional annual retainer of $2,000 (to the extent there are co-leads of the valuation oversight committee, the annual retainer will be split evenly between the co-leads) and the governance committee chair receives an additional annual retainer of $750.
These expenses are allocated on a pro rata basis to each Fund of the Trust according to its respective net assets. The Trust pays no compensation directly to any Trustee or any other officer who is affiliated with the Administrator, all of whom receive remuneration for their services to the Trust from the Administrator or its affiliates.
(e) Expense Limitation PIMCO has agreed to waive a portion of the Funds’ Supervisory and Administrative Fees in each Fund’s first fiscal year, to the extent that the payment of each Fund’s pro rata share of
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organizational expenses and Trustee Fees cause the actual expense ratio to rise above the rates disclosed in the then-current prospectus plus 0.0049%, the “Expense Limit” (calculated as a percentage of each Fund’s average daily net assets attributable to each class).
PIMCO may be reimbursed for these waived amounts in future periods, not to exceed thirty-six months after the waiver. Expenses that have been waived may still be reimbursed by the Administrator, to the extent the Fund’s annualized total portfolio operating expenses plus the amount reimbursed does not exceed the Expense Limit. The recoverable amounts to PIMCO at December 31, 2015, were as follows (amounts in thousands):
Fund Name | Recoverable Amounts | |||||
PIMCO RealPath™ Blend 2020 Fund | $ | 17 | ||||
PIMCO RealPath™ Blend 2025 Fund | 17 | |||||
PIMCO RealPath™ Blend 2030 Fund | 17 | |||||
PIMCO RealPath™ Blend 2035 Fund | 17 | |||||
PIMCO RealPath™ Blend 2040 Fund | 17 | |||||
PIMCO RealPath™ Blend 2045 Fund | 17 | |||||
PIMCO RealPath™ Blend 2050 Fund | 17 | |||||
PIMCO RealPath™ Blend 2055 Fund | 17 | |||||
PIMCO RealPath™ Blend Income Fund | 17 |
(f) Acquired Fund Fees and Expenses The Underlying PIMCO Fund expenses for the Funds are based upon an allocation of a Fund’s assets among the Underlying PIMCO Funds and upon the total annual operating expenses of the Institutional Class or Class M shares, as applicable, of these Underlying PIMCO Funds. Underlying PIMCO Fund expenses for the Funds will vary with changes in the expenses of the Underlying PIMCO Funds, as well as the allocation of a Fund’s assets.
The expenses associated with investing in a fund of funds are generally higher than those for mutual funds that do not invest in other mutual funds. The cost of investing in a fund of funds will generally be higher than the cost of investing in a mutual fund that invests directly in individual stocks and bonds. By investing in a fund of funds, an investor will indirectly bear fees and expenses charged by Acquired Funds in addition to each Fund’s direct fees and expenses. In addition, the use of a fund of funds structure could affect the timing, amount and character of distributions to the shareholders and may therefore increase the amount of taxes payable by shareholders.
8. RELATED PARTY TRANSACTIONS
The Adviser, Administrator, and Distributor are related parties. Fees payable to these parties are disclosed in Note 7 and the accrued related party fee amounts are disclosed on the Statements of Assets and Liabilities.
9. GUARANTEES AND INDEMNIFICATIONS
Under the Trust’s organizational documents, each Trustee or officer of the Trust is indemnified and each employee or other agent of the
Trust (including the Trust’s investment manager) may be indemnified, to the extent permitted by the Act, against certain liabilities that may arise out of performance of their duties to the Funds. Additionally, in the normal course of business, the Funds enter into contracts that contain a variety of indemnification clauses. The Funds’ maximum exposure under these arrangements is unknown as this would involve future claims that may be made against the Funds that have not yet occurred. However, the Funds have not had prior claims or losses pursuant to these contracts.
10. PURCHASES AND SALES OF SECURITIES
The length of time a Fund has held a particular security is not generally a consideration in investment decisions. A change in the securities held by a Fund is known as “portfolio turnover.” Each Fund may engage in frequent and active trading of portfolio securities to achieve its investment objective, particularly during periods of volatile market movements. High portfolio turnover may involve correspondingly greater transaction costs to a Fund, including brokerage commissions or dealer mark-ups and other transaction costs on the sale of securities and reinvestments in other securities. Such sales may also result in realization of taxable capital gains, including short-term capital gains (which are generally taxed at ordinary income tax rates). The transaction costs and tax effects associated with portfolio turnover may adversely affect a Fund’s performance. The portfolio turnover rates are reported in the Financial Highlights.
Purchases and sales of securities (excluding short-term investments) for the period ended December 31, 2015, were as follows (amounts in thousands†):
U.S. Government/Agency | All Other | |||||||||||||||||
Fund Name | Purchases | Sales | Purchases | Sales | ||||||||||||||
PIMCO RealPath™ Blend 2020 Fund | $ | 0 | $ | 0 | $ | 333 | $ | 149 | ||||||||||
PIMCO RealPath™ Blend 2025 Fund | 0 | 0 | 1,020 | 184 | ||||||||||||||
PIMCO RealPath™ Blend 2030 Fund | 0 | 0 | 361 | 180 | ||||||||||||||
PIMCO RealPath™ Blend 2035 Fund | 0 | 0 | 642 | 147 | ||||||||||||||
PIMCO RealPath™ Blend 2040 Fund | 0 | 0 | 243 | 146 | ||||||||||||||
PIMCO RealPath™ Blend 2045 Fund | 0 | 0 | 280 | 153 | ||||||||||||||
PIMCO RealPath™ Blend 2050 Fund | 0 | 0 | 259 | 125 | ||||||||||||||
PIMCO RealPath™ Blend 2055 Fund | 0 | 0 | 203 | 150 | ||||||||||||||
PIMCO RealPath™ Blend Income Fund | 0 | 0 | 324 | 171 |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
78 | PIMCO EQUITY SERIES |
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December 31, 2015 (Unaudited)
11. SHARES OF BENEFICIAL INTEREST
The Trust may issue an unlimited number of shares of beneficial interest with a $0.0001 par value. Changes in shares of beneficial interest were as follows (shares and amounts in thousands†):
PIMCO 2020 Fund(1) | PIMCO 2025 Fund(2) | |||||||||||||||||||||||||||||||||
Six Months Ended 12/31/2015 | Inception date Through | Six Months Ended 12/31/2015 | Inception date Through June 30, 2015 | |||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||
Receipts for shares sold | ||||||||||||||||||||||||||||||||||
Institutional Class | 11 | $ | 112 | 300 | $ | 3,000 | 78 | $ | 779 | 302 | $ | 3,013 | ||||||||||||||||||||||
Administrative Class | 0 | 0 | 1 | 10 | 0 | 0 | 1 | 15 | ||||||||||||||||||||||||||
Class A | 0 | 0 | 1 | 10 | 0 | 0 | 1 | 11 | ||||||||||||||||||||||||||
Issued as reinvestment of distributions | ||||||||||||||||||||||||||||||||||
Institutional Class | 7 | 62 | 1 | 15 | 8 | 73 | 1 | 15 | ||||||||||||||||||||||||||
Administrative Class | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||
Class A | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||
Cost of shares redeemed | ||||||||||||||||||||||||||||||||||
Institutional Class | 0 | 0 | 0 | 0 | (78 | ) | (737 | ) | 0 | 0 | ||||||||||||||||||||||||
Administrative Class | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||
Class A | 0 | 0 | 0 | 0 | (0 | ) | (1 | ) | 0 | 0 | ||||||||||||||||||||||||
Net increase (decrease) resulting from Fund | 18 | $ | 174 | 303 | $ | 3,035 | 8 | $ | 114 | 305 | $ | 3,054 | ||||||||||||||||||||||
PIMCO RealPath™ Blend 2030 Fund(3) | PIMCO RealPath™ Blend 2035 Fund(4) | PIMCO RealPath™ Blend 2040 Fund(5) | ||||||||||||||||||||||||||||||||||||||||||||||||
Six Months Ended 12/31/2015 | Inception date Through | Six Months Ended 12/31/2015 | Inception date Through | Six Months Ended 12/31/2015 | Inception date Through | |||||||||||||||||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||||||||||||||
Receipts for shares sold | ||||||||||||||||||||||||||||||||||||||||||||||||||
Institutional Class | 17 | $ | 160 | 300 | $ | 3,000 | 46 | $ | 460 | 301 | $ | 3,000 | 1 | $ | 16 | 301 | $ | 3,000 | ||||||||||||||||||||||||||||||||
Administrative Class | 0 | 2 | 1 | 10 | 0 | 0 | 1 | 10 | 3 | 22 | 1 | 12 | ||||||||||||||||||||||||||||||||||||||
Class A | 0 | 3 | 1 | 10 | 0 | 0 | 2 | 23 | 2 | 20 | 1 | 11 | ||||||||||||||||||||||||||||||||||||||
Issued as reinvestment of distributions | ||||||||||||||||||||||||||||||||||||||||||||||||||
Institutional Class | 7 | 62 | 1 | 15 | 6 | 61 | 1 | 15 | 5 | 49 | 1 | 15 | ||||||||||||||||||||||||||||||||||||||
Administrative Class | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||||||
Class A | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||||||
Cost of shares redeemed | ||||||||||||||||||||||||||||||||||||||||||||||||||
Institutional Class | (4 | ) | (35 | ) | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||||
Administrative Class | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||||||
Class A | 0 | 0 | 0 | 0 | (1 | ) | (11 | ) | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||||||||||||
Net increase (decrease) resulting from Fund | | 20 | | $ | 192 | 303 | $ | 3,035 | 51 | $ | 510 | 305 | $ | 3,048 | 11 | $ | 107 | 304 | $ | 3,038 | ||||||||||||||||||||||||||||||
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 79 |
Table of Contents
Notes to Financial Statements (Cont.)
PIMCO 2045 Fund(6) | PIMCO 2050 Fund(7) | |||||||||||||||||||||||||||||||||
Six Months Ended 12/31/2015 | Inception date Through | Six Months Ended 12/31/2015 | Inception date Through June 30, 2015 | |||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||
Receipts for shares sold | ||||||||||||||||||||||||||||||||||
Institutional Class | 12 | $ | 108 | 300 | $ | 3,000 | 3 | $ | 38 | 301 | $ | 3,001 | ||||||||||||||||||||||
Administrative Class | 0 | 0 | 4 | 40 | 0 | 0 | 1 | 14 | ||||||||||||||||||||||||||
Class A | 0 | 0 | 1 | 10 | 7 | 60 | 1 | 15 | ||||||||||||||||||||||||||
Issued as reinvestment of distributions | ||||||||||||||||||||||||||||||||||
Institutional Class | 5 | 48 | 1 | 15 | 5 | 48 | 1 | 15 | ||||||||||||||||||||||||||
Administrative Class | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||
Class A | 0 | 0 | 0 | 0 | 0 | 1 | 0 | 0 | ||||||||||||||||||||||||||
Cost of shares redeemed | ||||||||||||||||||||||||||||||||||
Institutional Class | (2 | ) | (18 | ) | 0 | 0 | 0 | 0 | 0 | (1 | ) | |||||||||||||||||||||||
Administrative Class | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||
Class A | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||
Net increase (decrease) resulting from Fund | 15 | $ | 138 | 306 | $ | 3,065 | 15 | $ | 147 | 304 | $ | 3,044 | ||||||||||||||||||||||
PIMCO RealPath™ Blend 2055 Fund(8) | PIMCO RealPath™ Blend Income Fund(9) | |||||||||||||||||||||||||||||||||
Six Months Ended 12/31/2015 | Inception date Through | Six Months Ended 12/31/2015 | Inception date Through | |||||||||||||||||||||||||||||||
Shares | Amount | Shares | Amount | Shares | Amount | Shares | Amount | |||||||||||||||||||||||||||
Receipts for shares sold | ||||||||||||||||||||||||||||||||||
Institutional Class | 2 | $ | 14 | 300 | $ | 3,001 | 11 | $ | 95 | 304 | $ | 3,037 | ||||||||||||||||||||||
Administrative Class | 0 | 0 | 1 | 11 | 0 | 0 | 2 | 14 | ||||||||||||||||||||||||||
Class A | 0 | 0 | 7 | 67 | 0 | 2 | 7 | 74 | ||||||||||||||||||||||||||
Issued as reinvestment of distributions | ||||||||||||||||||||||||||||||||||
Institutional Class | 5 | 49 | 1 | 15 | 6 | 61 | 1 | 15 | ||||||||||||||||||||||||||
Administrative Class | 0 | 0 | 0 | 0 | 0 | 0 | 0 | 0 | ||||||||||||||||||||||||||
Class A | 0 | 1 | 0 | 0 | 0 | 1 | 0 | 0 | ||||||||||||||||||||||||||
Cost of shares redeemed | ||||||||||||||||||||||||||||||||||
Institutional Class | 0 | (1 | ) | 0 | 0 | (4 | ) | (35 | ) | 0 | 0 | |||||||||||||||||||||||
Administrative Class | 0 | 0 | 0 | 0 | 0 | (4 | ) | 0 | 0 | |||||||||||||||||||||||||
Class A | 0 | 0 | 0 | 0 | (2 | ) | (17 | ) | 0 | 0 | ||||||||||||||||||||||||
Net increase (decrease) resulting from Fund | 7 | $ | 63 | 309 | $ | 3,094 | 11 | $ | 103 | 314 | $ | 3,140 |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
(1) | As of December 31, 2015, one shareholder owned 10% or more of the Fund’s total outstanding shares comprising 96% of the Fund, and the shareholder is a related party of the Fund.* |
(2) | As of December 31, 2015, one shareholder owned 10% or more of the Fund’s total outstanding shares comprising 99% of the Fund, and the shareholder is a related party of the Fund.* |
(3) | As of December 31, 2015, one shareholder owned 10% or more of the Fund’s total outstanding shares comprising 96% of the Fund, and the shareholder is a related party of the Fund.* |
(4) | As of December 31, 2015, one shareholder owned 10% or more of the Fund’s total outstanding shares comprising 87% of the Fund, and the shareholder is a related party of the Fund.* |
(5) | As of December 31, 2015, one shareholder owned 10% or more of the Fund’s total outstanding shares comprising 98% of the Fund, and the shareholder is a related party of the Fund.* |
(6) | As of December 31, 2015, one shareholder owned 10% or more of the Fund’s total outstanding shares comprising 96% of the Fund, and the shareholder is a related party of the Fund.* |
(7) | As of December 31, 2015, one shareholder owned 10% or more of the Fund’s total outstanding shares comprising 97% of the Fund, and the shareholder is a related party of the Fund.* |
(8) | As of December 31, 2015, one shareholder owned 10% or more of the Fund’s total outstanding shares comprising 98% of the Fund, and the shareholder is a related party of the Fund.* |
(9) | As of December 31, 2015, one shareholder owned 10% or more of the Fund’s total outstanding shares comprising 95% of the Fund, and the shareholder is a related party of the Fund.* |
* | Related parties may include, but are not limited to, the investment manager and its affiliates, affiliated broker dealers, fund of funds and directors or employees of the Trust or Adviser. |
12. REGULATORY AND LITIGATION MATTERS
The Funds are not named as defendants in any material litigation or arbitration proceedings and are not aware of any material litigation or claim pending or threatened against them.
PIMCO has received a Wells Notice from the staff of the U.S. Securities and Exchange Commission (“SEC”) that relates to the PIMCO Total
Return Active Exchange-Traded Fund (“BOND”), a series of PIMCO ETF Trust. The notice indicates the staff’s preliminary determination to recommend that the SEC commence a civil action against PIMCO stemming from a non-public investigation relating to BOND. A Wells Notice is neither a formal allegation of wrongdoing nor a finding that any law was violated.
80 | PIMCO EQUITY SERIES |
Table of Contents
December 31, 2015 (Unaudited)
This matter principally pertains to the valuation of smaller sized positions in non-agency mortgage-backed securities purchased by BOND between its inception on February 29, 2012 and June 30, 2012, BOND’s performance disclosures for that period, and PIMCO’s compliance policies and procedures related to these matters.
The Wells process provides PIMCO with the opportunity to demonstrate to the SEC staff why it believes its conduct was appropriate, in keeping with industry standards, and that no action should be taken. PIMCO believes that this matter is unlikely to have a material adverse effect on any Fund or on PIMCO’s ability to provide investment management services to any Fund.
The foregoing speaks only as of the date of this report.
13. FEDERAL INCOME TAX MATTERS
Each Fund intends to qualify as a regulated investment company under Subchapter M of the Internal Revenue Code (the “Code”) and distribute all of its taxable income and net realized gains, if applicable, to shareholders. Accordingly, no provision for Federal income taxes has been made.
A Fund may be subject to local withholding taxes, including those imposed on realized capital gains. Any applicable foreign capital gains tax is accrued daily based upon net unrealized gains, and may be payable following the sale of any applicable investments.
In accordance with U.S. GAAP, the Adviser has reviewed the Funds’ tax positions for all open tax years. As of December 31, 2015, the Funds have recorded no liability for net unrecognized tax benefits relating to uncertain income tax positions they have taken or expect to take in future tax returns.
The Funds file U.S. tax returns. While the statute of limitations remains open to examine the Funds’ U.S. tax returns filed for the fiscal years ending in 2012-2014, no examinations are in progress or anticipated at this time. The Funds are not aware of any tax positions for which it is
reasonably possible that the total amounts of unrecognized tax benefits will significantly change in the next twelve months.
The Funds, through the Underlying PIMCO Funds, may gain exposure to the commodities markets primarily through index-linked notes, and may invest in other commodity-linked derivative instruments, including commodity swap agreements, options, futures contracts, options on futures contracts and foreign funds investing in similar commodity- linked derivatives.
One of the requirements for favorable tax treatment as a regulated investment company under the Code is that a Fund must derive at least 90% of its gross income from certain qualifying sources of income. The IRS has issued a revenue ruling which holds that income derived from commodity index linked swaps is not qualifying income under Sub chapter M of the Code. The IRS has also issued private letter rulings in which the IRS specifically concluded that income from certain commodity index-linked notes is qualifying income. The IRS has also issued private letter rulings in which the IRS specifically concluded that income derived from an investment in a subsidiary, which invests primarily in commodity-linked swaps, will also be qualifying income. Based on the reasoning in such rulings, each Fund will continue to seek to gain exposure to the commodity markets primarily through investments in commodity-linked notes and through any investments in its Subsidiary.
It should be noted, however, that the IRS currently has suspended the issuance of such rulings pending further review. There can be no assurance that the IRS will not change its position that income derived from commodity-linked notes and wholly-owned subsidiaries is qualifying income. Furthermore, the tax treatment of commodity-linked notes, other commodity-linked derivatives, and a Fund’s investments in the Subsidiaries of the Underlying PIMCO Funds may otherwise be adversely affected by future legislation, Treasury Regulations and/or guidance issued by the IRS. Such developments could affect the character, timing and/or amount of a Fund’s taxable income or any distributions made by the Fund or result in the inability of the Fund to operate as described in its Prospectus.
Under the Regulated Investment Company Act of 2010, a fund is permitted to carry forward any new capital losses for an unlimited period. Additionally, such capital losses that are carried forward will retain their character as either short-term or long-term capital losses rather than being considered all short-term under previous law.
As of June 30, 2015, the Funds had the following post-effective capital losses with no expiration (amounts in thousands):
Short-Term | Long-Term | |||||||||
PIMCO RealPath™ Blend 2020 Fund | $ | — | $ | — | ||||||
PIMCO RealPath™ Blend 2025 Fund | — | — | ||||||||
PIMCO RealPath™ Blend 2030 Fund | — | — | ||||||||
PIMCO RealPath™ Blend 2035 Fund | — | — | ||||||||
PIMCO RealPath™ Blend 2040 Fund | — | — | ||||||||
PIMCO RealPath™ Blend 2045 Fund | — | — | ||||||||
PIMCO RealPath™ Blend 2050 Fund | — | — | ||||||||
PIMCO RealPath™ Blend 2055 Fund | — | — | ||||||||
PIMCO RealPath™ Blend Income Fund | — | — |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 81 |
Table of Contents
Notes to Financial Statements (Cont.)
December 31, 2015 (Unaudited)
As of December 31, 2015, the aggregate cost and the net unrealized appreciation (depreciation) of investments for federal income tax purposes are as follows (amounts in thousands†):
Fund Name | Federal Tax Cost | Aggregate Gross Unrealized Appreciation | Aggregate Gross Unrealized (Depreciation) | Net Unrealized Appreciation (Depreciation) (1) | ||||||||||||||
PIMCO RealPath™ Blend 2020 Fund | $ | 3,164 | $ | 0 | $ | (203 | ) | $ | (203 | ) | ||||||||
PIMCO RealPath™ Blend 2025 Fund | 3,841 | 0 | (245 | ) | (245 | ) | ||||||||||||
PIMCO RealPath™ Blend 2030 Fund | 3,172 | 0 | (224 | ) | (224 | ) | ||||||||||||
PIMCO RealPath™ Blend 2035 Fund | 3,499 | 0 | (246 | ) | (246 | ) | ||||||||||||
PIMCO RealPath™ Blend 2040 Fund | 3,089 | 0 | (199 | ) | (199 | ) | ||||||||||||
PIMCO RealPath™ Blend 2045 Fund | 3,142 | 0 | (208 | ) | (208 | ) | ||||||||||||
PIMCO RealPath™ Blend 2050 Fund | 3,128 | 0 | (197 | ) | (197 | ) | ||||||||||||
PIMCO RealPath™ Blend 2055 Fund | 3,094 | 0 | (199 | ) | (199 | ) | ||||||||||||
PIMCO RealPath™ Blend Income Fund | 3,195 | 0 | (186 | ) | (186 | ) |
(1) | Primary differences, if any, between book and tax net unrealized appreciation (depreciation) are attributable to wash sale loss deferrals. |
† | A zero balance may reflect actual amounts rounding to less than one thousand. |
82 | PIMCO EQUITY SERIES |
Table of Contents
Glossary: (abbreviations that may be used in the preceding statements)
(Unaudited)
Counterparty Abbreviations: | ||
CBK | Citibank N.A. | |
Currency Abbreviations: | ||
USD (or $) | United States Dollar | |
Exchange Abbreviations: | ||
CBOE | Chicago Board Options Exchange | |
Index/Spread Abbreviations: | ||
BCOMTR | Bloomberg Commodity Index Total Return | |
Other Abbreviations: | ||
REIT | Real Estate Investment Trust |
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 83 |
Table of Contents
Approval of Investment Advisory Contract and Other Agreements
Approval of Renewal of the Investment Advisory Contract and Second Amended and Restated Supervision and Administration Agreement
At a meeting held on August 12, 2015, the Board of Trustees (the “Board”) of PIMCO Equity Series (the “Trust”), including all of the Trustees who are not “interested persons” of the Trust under the Investment Company Act of 1940, as amended (the “Independent Trustees”), considered and unanimously approved the Investment Advisory Contract (the “Investment Advisory Contract”) between the Trust, on behalf of each of the Trust’s series (the “Funds”), and Pacific Investment Management Company LLC (“PIMCO”) for an additional one-year term through August 31, 2016. The Board also considered and unanimously approved for an additional one-year term through August 31, 2016, the Second Amended and Restated Supervision and Administration Agreement (the “Supervision and Administration Agreement” and together with the Investment Advisory Contract, the “Agreements”) between the Trust, on behalf of the Funds, and PIMCO.
The information, material factors and conclusions that formed the basis for the Board’s approvals are summarized below.
1. INFORMATION RECEIVED
(a) Materials Reviewed: During the course of the past year, the Trustees received a wide variety of materials relating to the services provided by PIMCO to the Trust. At each of its quarterly meetings, the Board reviewed the Funds’ investment performance and a significant amount of information relating to Fund operations, including shareholder services, valuation and custody, the Funds’ compliance program and other information relating to the nature, extent and quality of services provided by PIMCO to the Trust. In considering whether to approve the renewal of the Agreements, the Board also reviewed supplementary information, including, but not limited to, comparative industry data with regard to investment performance, advisory and supervisory and administrative fees and expenses, financial information for PIMCO, information regarding the profitability to PIMCO of its relationship with the Funds, information about the personnel providing investment management services, other advisory services and supervisory and administrative services to the Funds, and information about the fees charged and services provided to other clients with similar investment mandates as the Funds (where applicable). In addition, the Board reviewed materials provided by counsel to the Trust and the Independent Trustees, which included, among other things, memoranda outlining legal duties of the Board in considering the continuation of the Agreements.
(b) Review Process: In connection with the renewal of the Agreements, the Board reviewed written materials prepared by PIMCO in response to requests from counsel to the Trust and the Independent Trustees. The Board requested and received assistance and advice regarding applicable legal standards from counsel to the Trust and the
Independent Trustees, and reviewed comparative fee and performance data prepared at the Board’s request by Lipper, Inc. (“Lipper”), an independent provider of investment company performance and fee and expense data. The Board heard oral presentations on matters related to the Agreements and met both as a full Board and in a separate session of the Independent Trustees, without management present, at the August 12, 2015 meeting. The Independent Trustees also conducted a telephonic meeting with counsel to the Trust and the Independent Trustees on July 30, 2015 to discuss the materials presented. In addition, the Independent Trustees requested and received from PIMCO additional information including, but not limited to, information related to profitability and comparative performance information.
The approval determinations were made on the basis of each Trustee’s business judgment after consideration of all the information presented. Individual Trustees may have given different weights to certain factors and assigned various degrees of materiality to information received in connection with the approval process. In deciding to approve the renewal of the Agreements, the Board did not identify any single factor or particular information that, in isolation, was controlling. This summary describes the most important, but not all, of the factors considered by the Board.
2. NATURE, EXTENT AND QUALITY OF SERVICES
(a) PIMCO, its Personnel, and Resources: The Board considered the depth and quality of PIMCO’s investment management process, including: the experience, capability and integrity of its senior management and other personnel; the overall financial strength and stability of its organization; and the ability of its organizational structure to address changes in assets under management. The Board also considered the various services in addition to portfolio management that PIMCO provides under the Investment Advisory Contract. The Board noted that PIMCO makes available to its investment professionals a variety of resources and systems relating to investment management, compliance, trading, performance and portfolio accounting. The Board also noted that PIMCO is making a long-term commitment to building an equity asset management platform, and that PIMCO continues to invest in personnel and global infrastructure necessary to support the equity business. In this regard, the Board considered PIMCO’s commitment to investing in information technology supporting investment management and compliance, as well as PIMCO’s continuing efforts to attract and retain qualified personnel, including personnel with relevant equities experience, and to maintain and enhance its resources and systems. The Board considered PIMCO’s policies, procedures and systems to reasonably assure compliance with applicable laws and regulations and its
84 | PIMCO EQUITY SERIES |
Table of Contents
(Unaudited)
commitment to these programs, its oversight of matters that may involve conflicts of interest between the Funds’ investments and those of other accounts managed by PIMCO, and its efforts to keep the Trustees informed about matters relevant to the Funds and their shareholders. The Board also considered PIMCO’s continuous investment in new disciplines and talented personnel, which has enhanced PIMCO’s service to the Funds and has allowed PIMCO to introduce innovative new funds over time.
The Trustees considered information they had received about the steps that PIMCO has taken in recent years with respect to active management of counterparty risk, such as implementing procedures requiring daily collateral adjustments and frequent communication between credit analysts and the counterparty risk committee, which oversees counterparty risk on a firm-wide basis, continually evaluating requests to add or remove approved counterparties as market needs and conditions warrant. The Trustees also considered that, over the last several years, PIMCO has continued to strengthen the process it uses to assess the financial stability of counterparties with which the Funds do business, to manage collateral and to protect portfolios from an unforeseen deterioration in the creditworthiness of trading counterparties. The Trustees noted that, consistent with its fiduciary duty, PIMCO executes transactions through a competitive best execution process and uses only those counterparties that meet its stringent and monitored criteria. The Trustees considered that PIMCO’s collateral management team utilizes a counterparty risk system to analyze portfolio level exposure and collateral being exchanged with counterparties.
In addition, the Trustees considered new services and service enhancements that PIMCO has implemented since the Board renewed the Agreements in 2014, including, but not limited to: conducting a targeted review of quality and efficiency in the valuation process; expanding the analytical review of shareholder reports by State Street Bank and Trust Company, the Funds’ custodian; developing a process for monthly forecasts of taxable and book income to enhance portfolio management of investment income; continuing the expansion of a proprietary performance reconciliation tool, which includes next-day comparison of daily internal performance to custodian bank performance to identify potential errors and guardrail net asset value calculations; developing and implementing the Global Process Monitor application, which includes real-time tracking and escalation protocols for critical activities; and implementing monthly cash flow reporting processes to support client and media demands for information about investor flows and assets under management data.
Ultimately, the Board concluded that the nature, extent and quality of services proposed to be provided by PIMCO under the Agreements are likely to benefit the Funds and their respective shareholders.
(b) Other Services: The Board also considered the nature, extent, quality and cost of supervisory and administrative services provided by PIMCO to the Funds under the Supervision and Administration Agreement. The Board considered the terms of the Supervision and Administration Agreement, under which the Trust pays for the supervisory and administrative services provided pursuant to that agreement under what is essentially an all-in fee structure (the “unified fee”). In return, PIMCO provides or procures certain supervisory and administrative services and bears the costs of various third party services required by the Funds, including audit, custodial, portfolio accounting, legal, transfer agency and printing costs. The Board noted that the scope and complexity of the supervisory and administrative services provided by PIMCO under the Supervision and Administration Agreement continue to increase. The Board considered PIMCO’s provision of these services and its supervision of the Trust’s third party service providers to assure that these service providers continue to provide a high level of service relative to alternatives available in the market.
Ultimately, the Board concluded that the nature, extent and quality of the services provided by PIMCO has benefited, and will likely continue to benefit, the Funds and their shareholders.
3. INVESTMENT PERFORMANCE
The Board received and examined information from PIMCO concerning the Funds’ performance, as available, over short- and long-term periods ended May 31, 2015 and other performance data, as available, over short- and long-term periods ended June 30, 2015 (the “PIMCO Report”) and from Lipper concerning the Funds’ performance, as available, over short- and long-term periods ended May 31, 2015 (the “Lipper Report”). The Board considered that limited performance information was available for the PIMCO RealPath Blend Funds because the Funds recently commenced operations. The Board also considered information regarding both the short- and long-term investment performance of each Fund relative to its peer group and relevant benchmark index as provided to the Board in advance of each of its quarterly meetings throughout the year, including the PIMCO Report and Lipper Report, which were provided in advance of the August 12, 2015 meeting.
The Board noted that, according to Lipper, certain Funds had underperformed in comparison to their respective peer groups or benchmark indexes, or both, over short- and long-term periods. The Board discussed with PIMCO the reasons for the underperformance of certain Funds over short- and long-term periods. The Board also discussed actions that have been taken by PIMCO to attempt to improve performance and took note of PIMCO’s plans to monitor performance going forward.
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 85 |
Table of Contents
Approval of Investment Advisory Contract and Other Agreements (Cont.)
The Board ultimately concluded, within the context of all of its considerations in connection with the Agreements, that PIMCO’s performance record and process in managing the Funds indicates that its continued management is likely to benefit the Funds and their shareholders, and merits the approval of the continuation of the Agreements.
4. ADVISORY FEES, SUPERVISORY AND ADMINISTRATIVE FEES AND TOTAL EXPENSES
The Board considered that PIMCO seeks to price funds to scale at the outset with reference to the total expense ratios of the respective Lipper median (if available), while providing a premium for innovative investment offerings. PIMCO reported to the Board that, in proposing fees for any Fund or class of shares, it considers a number of factors, including the type and complexity of the services provided, the cost of providing services, the risk assumed by PIMCO in the development of products and the provision of services, the impact on potential returns from different levels of fees, the competitive marketplace for financial products, and the attractiveness of potential Fund returns to current and potential investors. Fees charged to or proposed for different Funds for advisory services and supervisory and administrative services may vary in light of these various factors. The Board also considered that PIMCO reviews the Funds’ fee levels and carefully considers reductions where appropriate.
The Board reviewed the advisory fees, supervisory and administrative fees and total expenses of the Funds (each as a percentage of average net assets) and compared such amounts with the average and median fee and expense levels of other similar funds. With respect to advisory fees, the Board reviewed data from Lipper that compared the average and median advisory fees of other funds in a “Peer Group” of comparable funds, as well as the universe of other similar funds. The Board noted that PIMCO had contractually agreed, through October 31, 2015, to reduce its advisory fee by amounts shown in the table below:
PIMCO Balanced Income Fund | 0.15% | |||||
PIMCO Dividend and Income Builder Fund | 0.16% | |||||
PIMCO Global Dividend Fund | 0.16% | |||||
PIMCO International Dividend Fund | 0.16% | |||||
PIMCO U.S. Dividend Fund | 0.16% |
The Board further noted that the PIMCO Emerging Multi-Asset, PIMCO EqS® Emerging Markets and PIMCO EqS® Pathfinder Funds liquidated on July 14, 2015.
The Board also reviewed data comparing the Funds’ advisory fees to the standard fee rate PIMCO charges to separate accounts and to other investment companies with similar investment strategies, including differences in advisory services provided. The Board discussed separate
account and/or U.S. and non-U.S. registered fund comparisons to the PIMCO Global Dividend Fund, PIMCO Balanced Income Fund and PIMCO Dividend and Income Builder Fund (as available), noting that for the remaining Funds, there were no appropriate comparisons among separate accounts or non-U.S. registered funds at the time that the Board considered the Agreements. For PIMCO Global Dividend Fund, for which PIMCO offers a separate account with an investment strategy similar to the Fund, the Board noted that the separate account fee was lower than that charged to the Fund, but also noted that the differences in fees were attributable to various factors, including differences in the advisory and other services provided by PIMCO to the Fund, the manner in which similar portfolios may be managed, different requirements with respect to liquidity management and the implementation of other regulatory requirements, and the fact that separate accounts may have other contractual arrangements that justify different levels of fees. The Board noted that the advisory fees (or management fees, where applicable) for most Funds were similar to the fee rates charged to other investment companies with the same investment strategies as the Funds.
In considering the fees paid by the Funds, the Board noted that retail investors in the Funds receive the benefit of PIMCO’s advisory services at the same advisory fee rates as institutional investors in the Funds.
The Board considered the Funds’ supervisory and administrative fees, comparing them to similar funds in the report supplied by Lipper. The Board also considered that as the Funds’ business has become increasingly complex and the number of Funds has grown, PIMCO has provided an increasingly broad array of fund supervisory and administrative functions. In addition, the Board considered the Trust’s unified fee structure, under which the Trust pays for the supervisory and administrative services it requires for one set fee and, in return, PIMCO provides or procures supervisory and administrative services and bears the costs of various third party services required by the Funds, including audit, custodial, portfolio accounting, legal, transfer agency and printing costs. The Board further considered that many other funds pay for these services separately, and thus it is difficult to directly compare the Trust’s unified supervisory and administrative fees with the fees paid by other funds for administrative services alone. The Board also considered that the unified supervisory and administrative fee leads to Fund fees that are fixed, rather than variable. The Board noted that, although the unified fee structure does not have breakpoints, it implicitly reflects economies of scale by fixing the absolute level of Fund fees at competitive levels even if the Funds’ operating costs rise when assets remain flat or decrease. The Board concluded that the Funds’ supervisory and administrative fees were reasonable in relation to the value of the services provided, including the services provided to different classes of shareholders, and that the expenses assumed contractually by PIMCO under the
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Supervision and Administration Agreement represent, in effect, a cap on overall Fund fees, which is beneficial to the Funds and their shareholders.
The Board noted that the Funds’ total expenses continued to be generally in-line with those of competitor funds. The Board discussed with PIMCO those Funds and/or classes of Funds that had above median total expenses. Upon comparing the Funds’ total expenses to other funds in the “Peer Groups” provided by Lipper, the Board found total expenses of each Fund to be reasonable.
Based on the information presented by PIMCO and Lipper, members of the Board determined, in the exercise of their business judgment, that the level of the advisory fees and supervisory and administrative fees charged by PIMCO under the Agreements, as well as the total expenses of each Fund, are reasonable.
5. ADVISER COSTS, LEVEL OF PROFITS AND ECONOMIES OF SCALE
The Board reviewed information regarding PIMCO’s costs of providing services to the Funds as a whole and considered that PIMCO continues to invest in the equity asset management platform and does not expect to derive any profit from the Funds during the Trust’s fiscal year ended December 31, 2015. The Board noted that it had received information regarding the structure and manner in which PIMCO’s investment professionals were compensated, and PIMCO’s view of the relationship of such compensation to the attraction and retention of quality personnel. The Board considered PIMCO’s need to invest in technology, cyber security, information security, shareholder privacy, business continuity planning, infrastructure and staff to reinforce and offer new services and to accommodate changing regulatory requirements.
With respect to potential economies of scale, the Board noted that PIMCO shares the benefits of economies of scale with the Funds and their shareholders in a number of ways, including through the pricing of Funds to scale from inception and the enhancement of services provided to the Funds in return for fees paid. In considering the advisory fees paid by the Funds, the Board also noted that retail investors in the Funds receive the benefit of PIMCO’s advisory services at the same advisory fee rates as institutional investors in the Funds. The Board considered that the Funds’ unified fee rates had been set competitively and/or priced to scale from inception and continued to be competitive compared with peers. The Board also considered that the unified fee is a transparent means of informing Fund shareholders of the fees associated with the Funds, and that the Funds bear certain expenses that are not covered by the advisory fee or the unified fee.
The Trustees considered that the unified fee has provided inherent economies of scale because a Fund maintains competitive fixed unified fees even if the particular Fund’s assets decline and/or operating costs rise. The Trustees further considered that, in contrast, breakpoints are a proxy for charging higher fees on lower asset levels and that when a fund’s assets decline, breakpoints may reverse, which causes expense ratios to increase. The Trustees also considered that, unlike the Funds’ unified fee structure, funds with “pass through” administrative fee structures may experience increased expense ratios when fixed dollar fees are charged against declining fund assets. The Trustees also considered that the unified fee protects shareholders from a rise in operating costs that may result from, among other things, PIMCO’s investments in various business enhancements and infrastructure, including those referenced above. The Trustees noted that PIMCO’s investments in these areas are extensive.
The Board concluded that the Funds’ cost structures were reasonable and that the unified fee structure inherently involves the sharing of economies of scale between PIMCO and each of the Funds, to the benefit of their respective shareholders.
6. ANCILLARY BENEFITS
The Board considered other benefits received by PIMCO and its affiliates as a result of PIMCO’s relationship with the Trust, including possible ancillary benefits to PIMCO’s institutional investment management business due to the reputation and market penetration of the Trust. The Board also considered that affiliates of PIMCO provide distribution and shareholder services to the Funds and their respective shareholders, for which they may be compensated through distribution and servicing fees paid pursuant to the Funds’ Rule 12b-1 plans or otherwise. The Board reviewed PIMCO’s soft dollar policies and procedures, noting that while PIMCO has the authority to receive the benefit of research provided by broker-dealers executing portfolio transactions on behalf of the Funds, it has adopted a policy not to enter into contractual soft dollar arrangements.
7. CONCLUSIONS
Based on their review, including their consideration of each of the factors summarized above, the Independent Trustees and the Board as a whole concluded that the nature, extent and quality of the services rendered to the Funds by PIMCO favored the renewal of the Agreements. The Independent Trustees and the Board as a whole concluded that the Agreements continued to be fair and reasonable to the Funds and their shareholders, that the Funds’ shareholders received reasonable value in return for the fees paid to PIMCO by the Funds under the Agreements, and that the renewal of the Agreements was in the best interests of the Funds and their shareholders.
SEMIANNUAL REPORT | DECEMBER 31, 2015 | 87 |
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A special meeting of shareholders of the series of the Trust was held on February 5, 2016. The special meeting was held for the purpose of electing two (2) Trustees to the Trust’s Board of Trustees. Shareholders of all series of the Trust voted together on the proposal, and elected the following two (2) Trustees at the special meeting:
n | Jennifer Holden Dunbar |
n | Ronald C. Parker |
The results of the proxy solicitation on the preceding matter were as follows:
PIMCO Equity Series
Trustee Nominee | For* | Withheld* | ||||||||
Jennifer Holden Dunbar | 197,882,087 | 3,114,282 | ||||||||
Ronald C. Parker | 197,892,770 | 3,103,598 |
* | Certain series of the Trust’s shares were held by PIMCO-advised funds or accounts for which PIMCO had discretionary authority to vote proxies. Accordingly, PIMCO voted such shares in proportion to the votes of all other Trust shareholders voting on the proposal. |
88 | PIMCO EQUITY SERIES |
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General Information
Investment Adviser and Administrator
Pacific Investment Management Company LLC
650 Newport Center Drive
Newport Beach, CA 92660
Distributor
PIMCO Investments LLC
1633 Broadway
New York, NY 10019
Custodian
State Street Bank and Trust Company
801 Pennsylvania Avenue
Kansas City, MO 64105
Transfer Agent
Boston Financial Data Services
Institutional Class, Class P, Administrative Class, Class D
330 W. 9th Street, 5th Floor
Kansas City, MO 64105
Boston Financial Data Services
Class A, Class C, Class R
P.O. Box 55060
Boston, MA 02205-5060
Legal Counsel
Dechert LLP
1900 K Street, N.W.
Washington, D.C. 20006
Independent Registered Public Accounting Firm
PricewaterhouseCoopers LLP
1100 Walnut Street, Suite 1300
Kansas City, MO 64106
This report is submitted for the general information of the shareholders of the PIMCO Equity Series.
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PES3002AR_063015
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Item 2. | Code of Ethics. |
The information required by this Item 2 is only required in an annual report on this Form N-CSR.
Item 3. | Audit Committee Financial Expert. |
The information required by this Item 3 is only required in an annual report on this Form N-CSR.
Item 4. | Principal Accountant Fees and Services. |
The information required by this Item 4 is only required in an annual report on this Form N-CSR.
Item 5. | Audit Committee of Listed Registrants. |
The information required by this Item 5 is only required in an annual report on this Form N-CSR.
Item 6. | Schedule of Investments. |
The Schedule of Investments is included as part of the reports to shareholders under Item 1.
Item 7. | Disclosure of Proxy Voting Policies and Procedures for Closed-End Management Investment Companies. |
Not applicable.
Item 8. | Portfolio Managers of Closed-End Management Investment Companies. |
Not applicable.
Item 9. | Purchases of Equity Securities by Closed-End Management Investment Company and Affiliated Purchasers. |
Not applicable.
Item 10. | Submission of Matters to a Vote of Security Holders. |
There have been no material changes to the procedures by which shareholders may recommend nominees to the Trust’s Board of Trustees since the Trust last provided disclosure in response to this item.
Item 11. | Controls and Procedures. |
(a) | The principal executive officer and principal financial & accounting officer have concluded that the Registrant’s disclosure controls and procedures (as defined in Rule 30a-3(c) under the 1940 Act) provide reasonable assurances that material information relating to the Registrant is made known to them by the appropriate persons, based on their evaluation of these controls and procedures as of a date within 90 days of the filing of this report. |
(b) | There were no changes in the Registrant’s internal control over financial reporting (as defined in Rule 30a-3(d) under the 1940 Act) that occurred during the second fiscal quarter of the period covered by this report that have materially affected, or are reasonably likely to materially affect, the Registrant’s internal control over financial reporting. |
Item 12. | Exhibits. |
(a)(1) | Exhibit 99.CODE—Code of Ethics is not applicable for semiannual reports. |
(a)(2) | Exhibit 99.CERT—Certifications pursuant to Section 302 of the Sarbanes-Oxley Act of 2002. |
(b) | Exhibit 99.906CERT—Certifications pursuant to Section 906 of the Sarbanes-Oxley Act of 2002. |
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Signatures
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.
PIMCO Equity Series | ||
By: | /s/ Peter G. Strelow | |
Peter G. Strelow | ||
President (Principal Executive Officer) | ||
Date: | February 26, 2016 |
Pursuant to the requirements of the Securities Exchange Act of 1934 and the Investment Company Act of 1940, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.
By: | /s/ Peter G. Strelow | |
Peter G. Strelow | ||
President (Principal Executive Officer) | ||
Date: | February 26, 2016 | |
By: | /s/ Trent W. Walker | |
Trent W. Walker | ||
Treasurer (Principal Financial & Accounting Officer) | ||
Date: | February 26, 2016 |