PIMCO CIO Ivascyn on why they are taking a 'cautious and defensive' approach

Planning for radical changes in coming years

With PIMCO's Secular Outlook calling for potentially radical changes in the coming years, we are taking a more cautious and defensive approach in managing portfolios while remaining poised to take advantage of market overshoots.

Although we are cautious, we believe that this environment creates interesting investment opportunities.  Our income strategy is generally divided into two broad components. One component consists of higher-yielding assets, such as non-agency mortgage-backed securities and corporate credit, which we expect to do well if economic growth is stronger than expected.  2018 Secular Outlook: Turning Point for the Global Economy The other component consists of higher-quality assets, such as US Treasuries, that we expect to perform well when growth is slower than expected. We think this ...