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Portfolio > Portfolio Construction

Top Portfolio Products: PIMCO Launches New Fund; Credit Suisse Plans New ETN

By Marlene Y. Satter

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New products introduced over the last week include PIMCO’s new multi-asset fund, and Credit Suisse’s new equity ETN. In addition, Putnam Investments launched a new website for advisors, AlphaShares unveiled its new yuan bond index and Invesco announced a new yuan bond ETF, and Russell Investments expanded its investment discipline indexes to the small cap arena.

Here are the latest developments of interest to advisors:

1) PIMCO Launches PIMCO Inflation Response Multi-Asset Fund

PIMCO announced Tuesday the launch of the PIMCO Inflation Response Multi-Asset Fund (PIRMX,PZRMX), for investors looking to hedge global inflation risks and take advantage of returns that inflation dynamics offer.

The fund, combining PIMCO’s real return expertise and risk factor approach to asset allocation, is managed by Mihir Worah, a managing director in Newport Beach, Calif. It uses a multi-asset approach to identify and hedge risk to protect against inflation.

It may even take advantage of it by investing in a range of assets that might respond to different types of inflation. PIMCO actively manages the asset allocation and underlying investments and incorporates tail risk hedging strategies intended to limit the impact of severe market shocks. These strategies are designed to protect against downside risk while positioning inflation-related assets to benefit from inflation dynamics.

2) Credit Suisse Announces Launch of New Market-Neutral Equity ETN

Credit Suisse announced on Wednesday the launch of its Equity Market Neutral ETN (CSMN), the first ETN to provide exposure to an equity market neutral strategy in an exchange-traded format. It tracks a market-neutral strategy as represented by the HS Market Neutral Index powered by HOLT.

The index is intended to achieve stable returns while reducing risk by selecting a portfolio of 75 long stocks and 75 short stocks from over 20,000 global equities. The index uses Credit Suisse’s HOLT stock selection framework which incorporates factors including value and momentum.

3) Putnam Investments Introduces Customized, Analytical Web-Based Resources to Financial Advisors

Putnam Investments on Thursday officially launched a new website, www.putnam.com/advisor, that allows for advanced, open-architecture portfolio modeling to assist advisors in their work with clients. In addition to introducing a series of technology-enabled and social media-driven practice management elements, the new site builds upon its analytical tool, FundVisualizer.

The site also allows the advisor community to join conversations on Putnam’s social media sites, including those on Twitter and Facebook. A feedback component is available. The new site will provide advisors with a sense of what their peers are viewing most, and offer practice management and thought leadership resources.

4) AlphaShares Launches China Yuan Bond Index

AlphaShares, LLC announced Wednesday that it has launched a new China Yuan Bond Index designed to track bonds that are denominated in China’s local currency, the renminbi (RMB). The index measures and monitors the performance of an investable universe of publicly available Chinese fixed-income securities denominated in Chinese yuan and includes bonds issued by both mainland Chinese and non-Chinese entities.

Dr. Burton G. Malkiel, chairman of the AlphaShares Index Committee and a cofounder of the firm, said in a statement, “The index includes only investment-grade credits from major issuers including the Chinese government and Chinese government agencies such as the Export Import Bank of China and the China Development Bank. Approximately 90% of the issues in the index are rated A- or better.” The index has been licensed to Guggenheim Funds Investment Advisors, LLC.

5) Invesco PowerShares Lists Chinese Yuan Dim Sum Bond ETF

Invesco PowerShares announced Friday the launch of its Chinese Yuan Dim Sum Bond ETF (DSUM), based on the Citigroup Dim Sum (Offshore CNY) Bond Index.

The Fund will normally invest at least 90% of its total assets in Chinese yuan-denominated bonds that comprise the Index. The Index measures the performance of Chinese yuan-denominated “Dim Sum” bonds that are issued and settled outside of mainland China. The index includes fixed-rate securities issued by governments, agencies, supranationals and corporations that have a minimum maturity of one year and a minimum size outstanding of 1 billion yuan. The index is managed by Citigroup Index LLC and is reconstituted on a monthly basis.

6) Russell Expands Investment Discipline Indexes

Russell Investments announced Thursday that it will expand its Investment Discipline Indexes (IDIs) to include U.S. small cap indexes. Specifically, four new IDIs will be added to Russell’s lineup, each reflecting a particular approach to small cap security selection commonly practiced by professional money managers.

To expand the indexes, Russell analysts defined the four most widely practiced approaches of professional investment managers of small cap and categorized them into individual investment disciplines. The new IDIs include the Russell U.S. Small Cap Aggressive Growth Index, Russell U.S. Small Cap Consistent Growth Index, Russell U.S. Small Cap Low P/E Index and Russell U.S. Small Cap Contrarian Index.

Read last week’s Portfolio Products Roundup at AdvisorOne.com

 

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