PIMCO Total Return’s Mortgage Holdings at Two-Year Low

With mortgage-backed securities regaining value, PIMCO’s benchmark $169 billion Total Return Fund has been trimming its exposure to this sector, Dow Jones reports. The fund’s holdings of mortgage-backed securities fell to 47% in July, only slightly more than its 42% exposure in April 2007, and down considerably from a peak of 86% in February.

Meanwhile, the fund’s exposure to government assets edged up to 25%, from 24% in June, while investment-grade corporate debt remained steady at 18%.

For the 12 months ended July 31, the fund has returned 11.55%, following a stellar 4.8% performance in 2008, when Total Return beat 90% of its peers.