Fund Description

The fund seeks to exceed the total return of the S&P 500 Index and a secondary blended index by investing, under normal circumstances, in S&P 500 Index derivatives backed by a diversified portfolio of long-term Fixed Income Instruments. Fixed Income Instruments include bonds, debt securities and other similar instruments issued by various U.S. and non-U.S. public- or private-sector entities. It typically targets S&P 500 exposure approximately equal to net assets and seeks to remain invested even when the index declines, but may hold a basket of S&P 500 stocks if derivatives appear overvalued. The fund actively manages the Fixed Income Instruments, subject to an overall portfolio duration which normally varies within two years (plus or minus) of the portfolio duration of the securities comprising the Bloomberg Long-Term Government/Credit Index, as calculated by PIMCO. It may use options, futures or swaps; invest in mortgage- or asset-backed securities; use when-issued, delayed delivery or forward transactions; and engage in short sales. It may invest up to 10% in high yield securities (B or higher or comparable), up to 30% in foreign-currency securities while normally limiting net foreign currency exposure to 20%, up to 15% economically tied to emerging markets (with an exception for certain short-maturity investment grade sovereign debt), and up to 10% in preferred securities.