Products March 15, 2010

Schwab Offers Four PIMCO Muni Bond Strategies

March 15, 2010 (PLANSPONSOR.com) - Charles Schwab & Co., Inc. is expanding its fixed income offerings with four Municipal Bond Ladder Separately Managed Account (SMA) strategies managed by PIMCO.
Reported by

Schwab said the strategies are designed for fixed income investors seeking tax-advantaged solutions and income generation as well as ongoing professional management.      

According to a press release, investors work with their Schwab consultant or an independent investment adviser to select one of four strategies, each composed of 10 or more rungs for diversification:

  • PIMCO 1-12 Year Municipal Bond Ladder Separately Managed Account Strategy
  • PIMCO 1-18 Year Municipal Bond Ladder Separately Managed Account Strategy
  • PIMCO 1-12 Year California Municipal Bond Ladder Separately Managed Account Strategy
  • PIMCO 1-18 Year California Municipal Bond Ladder Separately Managed Account Strategy

     

Laddering municipal bonds involves buying municipal bonds that mature at staggered future dates to help minimize overall exposure to interest rate fluctuations while providing tax-exempt income. The Schwab-sponsored PIMCO Municipal Bond Ladder SMAs employ a professionally managed buy-and-hold strategy with a focus on investment selection and ongoing credit monitoring.       

The SMAs have an investment minimum of $250,000 and a program management fee of 0.35% for the first $1 million invested, 0.30% for the next $4 million and 0.25% for investments above $5 million.       

The PIMCO Municipal Bond Ladder strategies are available through Schwab’s Managed Account Connection program.

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