Karin Anderson, Morningstar mutual fund analyst, covered bronze-rated Pimco's [profile] Global Advantage Strategy Bond, which uses country gross domestic product rankings as the foundation for a custom benchmark instead of a traditional market cap approach.

Anderson writes that fund has an "attractive level of diversification" and its PMs exercised some caution by underweighting exposure to longer-dated maturities and lessening exposure to the emerging markets stake. Nonetheless, emerging markets were hit hard during the bond selloff and the fund's 5 percent loss was worse than 70 percent of its peers, Anderson points out.

It is a better fund for investors who can handle volatility, Anderson writes. Pimco's risk taking has been rewarded, giving it a "leg up" on the competition during the first four months of 2013, with the fund gaining 1 percent, or 77 bps greater than the world-bond-category norm, Anderson explains. Anderson writes that Pimco's fund also thinks ahead of the curve, analyzing credit components of indebted regions in before other bond managers.

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Edited by: Casey Quinlan


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