Fund Description

The fund, under normal circumstances, invests at least 80% of assets in municipal bonds whose interest is, in bond counsel's opinion at issuance, exempt from federal income tax. It intends to invest a portion in high yield and private activity bonds rated below investment grade (or comparable unrated), and may invest without limit in higher rated municipal bonds. It may invest up to 30% in private activity bonds subject to AMT, more than 25% of its total assets in bonds of issuers in California and New York, and in bonds issued by Puerto Rico. It may invest 25% or more in municipal bonds financing projects such as education, health care, housing, transportation and utilities, and 25% or more in industrial development bonds. The fund's average portfolio duration normally varies within (negative) 2 years to positive 4 years of the portfolio duration of the securities comprising the Bloomberg High Yield Municipal Bond Index, as calculated by PIMCO. The portfolio manager focuses on Municipal Bonds with the potential to offer high current income, typically looking for Municipal Bonds that can provide consistently attractive current yields or that are trading at competitive market prices; the total return sought by the fund consists of both income earned on its investments and capital appreciation, if any. The fund may also invest in other fixed income instruments, derivatives, mortgage- or asset-backed securities, when-issued and forward transactions, short sales, and preferred securities.