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I suspect i's merely for optics. Having a bunch of funds priced < $5 probably makes them feel embarrassed. Heck, I don't remember seeing a 'reverse split' for an OEF before, come to think of it...
It is all about the appearance and it looks bad from the NAV pricing perspective. Pimco had large redemptions in 2022. Unlike 2008’s GFC, Pimco did a lot better.
Pimco (especially Pimco Income) didn't do that well during the GFC, but they knocked it out of the park during the recovery. If someone wants to compare the performance between the successes of 2009 ff. and this period, the next two years are where the apples-to-apples comparison will be.
P.S. They have so many funds, sliced and diced into so many strategies, it sure wouldn't hurt to thin the herd a bit.
Reverse-splits for mutual funds don't make any (rational) sense. They don't trade like stocks, and trading and margin considerations don't apply.
99.9% of the time, I agree with this. There is the oddball exception where there is a sensible rationale for reverse splits.
BTTRX is a zero coupon bond fund. A real zero coupon bond pays no interest (though interest is imputed); it merely appreciates in value until maturity. BTTRX is designed to mimic this behaviour.
Reverse Share Splits When the fund pays its distributions, the board also declares a reverse share split for the fund that exactly offsets the per-share amount of the distribution. If you reinvest your dividends, this reverse share split means that you will hold exactly the same number of shares after a dividend as you did before. This reverse share split makes changes in the fund’s share prices behave like changes in the values of zero-coupon securities.
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P.S. They have so many funds, sliced and diced into so many strategies, it sure wouldn't hurt to thin the herd a bit.
BTTRX is a zero coupon bond fund. A real zero coupon bond pays no interest (though interest is imputed); it merely appreciates in value until maturity. BTTRX is designed to mimic this behaviour.
From the prospectus: https://www.americancentury.com/plan/tax-center/reverse-share-split/