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Pimco commodities funds - PCRIX vs PCLIX

edited July 2012 in Fund Discussions
I am looking to add some commodities exposure to my portfolio. PCRIX has a great 10 year record and seems to be the obvious choice. PCLIX, its newer cousin, has been around for less than 3 years and has substantially underperformed PCRIX.

I know that a less than 3 year track record is insufficient to base a decision on. But my question is this: Based on the limited information that we have on PCLIX, how can its underperformance be explained? Is it based upon the different indexes that are used for the benchmark for these funds, different styles of investing collateral funds or something else?


  • edited July 2012
    Pimco CommoditiesPLUS invests in a different index than the Pimco Commodity RR fund does, and the actively managed collateral is differently managed. Both funds, however, are effectively "commodity index funds" (it is an attempt to follow an index and then add performance on top of that by actively managing the collateral - in the case of Commodity RR, that is largely TIPS) and are subject to the volatility of the commodity markets in full, pretty much.

    The other issue with the Pimco Commodity fund is that it has a history of VERY significant distributions - the last one wasn't much, but many before that have been, including one in last December that was along the lines of about 12% of the fund.

    I have been moving money from Pimco Commodity RR to the more actively/tactically managed AQR Risk-Balanced Commodity (ARCNX) and will likely move money entirely over to the AQR fund.

    I also own Cohen and Steers Real Assets, a portion of which is an actively managed commodity futures portfolio (the other portions being global real estate and global natural resource companies - three separate management companies.)

    I also own AQR Risk Parity (AQRNX), a portion of which is commodities.

    Highbridge Dynamic Commodity (HDCCX) is another actively managed fund that can go long/short; it did exceptionally well when it first started a couple of years ago, but has not done nearly as well in the last several months. That fund is closed, though.
  • I don't think PCLIX has substantially underperformed PCRIX. When I look at the chart on Morningstar, they look roughly the same. PCRIX is doing a little better this year but PCLIX did better in 2011.

    If you are just looking for exposure to commodities and don't have any strong convictions about this sector, I would go with PCRIX. As far I can tell, it has stayed pretty close to its index and it is as close as you will get to a plain vanilla index fund for commodities. PCLIX is like one of those "enhanced indexes" for stocks that might work or might not. In the context of a portfolio, I don't see it making a big difference either way.

    Ditto scott's point about the crazy distributions of all of these PIMCO derivative-based funds.
  • Reply to @scott: what platform do you use to purchase ARCNX?
  • Reply to @brucea: Ameritrade.
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