All Asset and All Asset All Authority PIMCO All Asset Strategy

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1 All Asset and All Asset All Authority PIMCO All Asset Strategy A highly differentiated and diversified tactical asset allocation strategy that combines the strengths of PIMCO and Research Affiliates two sources of industry-leading investment expertise. In an era of historically low yields, muted return prospects and a changed economic landscape, adhering only to a traditional 60/40 mix of domestic stocks and bonds may not provide the level of returns investors need to reach to their goals. It may also leave investors inadequately diversified and exposed to inflation risk. Achieving attractive long-term returns above inflation with diversification from mainstream markets, requires a differentiated approach to asset allocation across a global opportunity set.

2 PIMCO All Asset Strategy aims to provide a high level of total return and diversification potential by investing across the full spectrum of actively managed PIMCO funds tactically managing the mix of traditional, alternative and inflation-hedging asset classes. ACHIEVING RETURN AND DIVERSIFICATION POTENTIAL IN CHALLENGING MARKETS Access a globally diversified opportunity set Incorporate excess return potential from active PIMCO management Tactically allocate using a value-oriented, contrarian investment process

3 PIMCO All Asset Strategy 3 Access attractive return and diversification potential Many investors tend to focus their portfolio on the two traditional portfolio pillars domestic stocks and core bonds. However, the prospective returns from these asset classes are likely to be lower than in recent historical experience. Since the financial crisis, easy monetary policies have helped propel these markets to substantially higher valuations and lower yields, which produced strong returns but have left investors with reduced forward-looking prospects. Additionally, core stocks and bonds have a disinflationary bias that is they tend to do well when inflation is low or falling. Stocks tend to outperform in a disinflationary economic expansion, and bonds benefit from a disinflationary economic contraction. However, both may be challenged when inflation trends higher. To create a more stable investment portfolio, investors should consider adding a third pillar to complement and counterbalance the return characteristics of core stocks and bonds. Often considered satellite investments, third pillar assets provide exposure to out-of-mainstream markets, which may offer a combination of attractive long-term return potential, lower correlation to mainstream markets and greater responsiveness to rising inflation. By investing in a third-pillar-centric strategy such as All Asset, alongside traditional stock and bond holdings, investors may enhance their long-term return potential while also improving portfolio diversification, reducing volatility and adding an explicit inflation buffer. THREE PILLARS ARE STRONGER THAN TWO Traditional balanced strategies are built on two pillars: mainstream stocks and bonds. Third pillar assets can provide higher long-term return potential, help diversify away from traditional stocks and bonds, and fare well in inflationary environments. INVESTOR PORTFOLIO Core Stocks Core Bonds Diversifiers 1FIRST PILLAR Participate in economic growth Seek returns Disinflationary bias 2SECOND PILLAR Provide income Reduce volatility Disinflationary bias 3THIRD PILLAR Provide uncorrelated return Seek diversification with income Inflationary bias TRADITIONAL 60/40 ALLOCATION ALL ASSET For illustrative purposes only

4 4 PIMCO All Asset Strategy A broadly diversified opportunity set Rather than focus exclusively on traditional stocks and bonds, PIMCO All Asset Strategy can access the broad spectrum of liquid asset classes and strategies a global opportunity set that includes developed and emerging market stocks and bonds, alternative investments and inflation-related assets. Exposures are obtained by investing across the full suite of actively managed PIMCO mutual funds and exchange-traded funds (ETFs), which provides exposure to these markets plus the excess return potential of PIMCO s active views. FLEXIBILITY TO DRAW ON THE FULL SPECTRUM ON PIMCO FUNDS With a broader opportunity set than traditional allocation strategies, PIMCO All Asset tactically allocates assets across a range of different asset classes, which can shift in and out of favor over time. 3 2 Short-Term Bond U.S. Core Bond 1 U.S. Long-Maturity Bond THIRD PILLAR STRATEGIES Credit Alternative Inflation-Related Global Bond Emerging Market Bond Emerging Market Equity Commodities and REITs SECOND PILLAR STRATEGIES FIRST PILLAR STRATEGIES U.S. Equity Developed ex-u.s. Equity Most investors rely on stocks and bonds. However, the third pillar, the one missing from many portfolios, addresses the need for diversifying away from these mainstream asset classes. Robert Arnott Founder and Chairman of Subadvisor, Research Affiliates, LLC

5 PIMCO All Asset Strategy 5 Tactically allocating with a value-orientated, contrarian focus The strategy s investment process is anchored on Research Affiliates central investment thesis that the largest and most persistent active investment opportunity is long-term mean reversion (prices and returns eventually move back towards the mean or average). As such, the strategy pursues higher returns when asset class valuations are fundamentally attractive and shifts away from popular asset classes when they are overvalued. This value-oriented, contrarian approach is the defining style of the All Asset strategy, and the culmination of portfolio manager Robert Arnott s 30 years of experience managing tactical asset allocation strategies. In determining the strategy s allocation, Mr. Arnott and his expert team at Research Affiliates use a disciplined, modeldriven process that relies on a number of essential building blocks, including: the long-term real return potential of each asset class; the excess return, or alpha, potential of the underlying PIMCO funds over their benchmarks; equity and bond risk premiums; and proprietary active asset allocation models. Additionally, the Research Affiliates team meets regularly with PIMCO s investment professionals to review and potentially incorporate qualitative factors that cannot be modeled, such as regulatory changes, policymaker decisions and geopolitical events. THE RESEARCH AFFILIATES TEAM The strategies are tactically managed by an industry-leading global asset allocation firm that is built on a strong research base and led by Robert Arnott and Christopher Brightman. Real assets Robert Arnott Founder and Chairman of Research Affiliates, LLC Christopher Brightman, CFA Chief Investment Officer of Research Affiliates, LLC

6 6 PIMCO All Asset Strategy Two levels of demonstrated investment expertise PIMCO All Asset Strategy delivers two levels of expert management. The underlying funds are managed by PIMCO and benefit from our extensive global resources and time-tested investment process. Asset allocation decisions are managed by Research Affiliates, LLC, a leading tactical asset allocation firm founded by Robert Arnott. PIMCO S ACTIVE MANAGEMENT PIMCO a global leader in active investment management across asset classes has a strong history of providing attractive risk-adjusted returns and pursuing excess returns above market indexes while managing risk. Our investment process is anchored in a disciplined focus on macroeconomic and corporate fundamentals, which provides an important backdrop against which we identify opportunities and risks and implement long-term investment strategies. This top-down approach is complemented by the bottom-up, sector-specific expertise of more than 230 portfolio managers and 115 analysts one of the deepest research teams in the business. RESEARCH AFFILIATES TACTICAL ALLOCATION Asset allocation is managed by the funds subadvisor, Research Affiliates, LLC. Founded by Robert Arnott in 2002, Research Affiliates is a global leader in research-driven asset allocation and smart beta strategies with more than 50 investment professionals. Mr. Arnott has authored over 100 articles for journals, such as the Financial Analysts Journal, the Journal of Portfolio Management and the Harvard Business Review, and served as editor of the Financial Analysts Journal. In 2002, he established Research Affiliates to develop robust investment products, including asset allocation models, and partner with leading firms like PIMCO to implement these products for the benefit of investors. Two ways to access PIMCO All Asset PIMCO All Asset is available in two strategies. Both employ the same investment philosophy and express the same asset allocation views; however, their objectives and investment parameters differ slightly: PIMCO ALL ASSET Seeks to achieve three key goals for investors: Long-term returns of 5% above the Consumer Price Index (CPI) Diversification away from domestic stocks, particularly in bear markets Inflation-hedging potential In pursuit of these goals, the strategy: Tactically allocates across actively managed PIMCO mutual funds and ETFs PIMCO ALL ASSET ALL AUTHORITY Seeks to achieve three key goals for investors: Long-term returns of 6.5% above the Consumer Price Index (CPI) Diversification away from domestic stocks, particularly in bear markets Inflation-hedging potential In pursuit of these goals, the strategy: Tactically allocates across actively managed PIMCO mutual funds and ETFs May use leverage, up to 1.5x net assets, to amplify attractive exposures May short the S&P 500 Index, to amplify diversification and control total risk

7 PIMCO All Asset Strategy 7 Incorporating PIMCO All Asset and All Asset All Authority into a portfolio Depending on an investor s objectives and tolerance for risk, PIMCO All Asset and All Asset All Authority strategies can be incorporated into a portfolio in a variety of ways. These highly diversified strategies can serve as global tactical asset allocation strategies that complement traditional stock/bond-centric approaches. The strategies focus on generating high real returns through an emphasis on inflation-sensitive third pillar assets also makes them attractive within a real asset inflation-hedging bucket. Additionally, because the strategies employ a benchmark agnostic approach, seeking long-term absolute returns with low equity beta, they can also serve as a key component in a liquid alternatives allocation. ROLE IN A PORTFOLIO Complement to traditional stock/bond-centric portfolios Real return-oriented multi-asset strategy Liquid alternative diversifying return driver Fixed income Fixed income Fixed income Real assets Alternatives ALL ASSET Equities ALL ASSET Real assets Alternatives Equities Real assets Alternatives ALL ASSET Equities May serve as a diversifying, tactical allocation strategy to complement traditional stock/ bond-centric portfolios May serve as an inflation hedging, real return-oriented multi-asset solution May serve as a diversifying return driver in a liquid alternatives bucket Displayed as sample portfolio construction models and should not be construed as investment advice.

8 PIMCO All Asset Fund symbols A shares PASAX C shares PASCX D shares PASCX P shares PALPX R shares PATRX Inst. shares PAAIX Admin. shares PAALX PIMCO All Asset All Authority Fund symbols A shares PAUAX C shares PAUCX D shares PAUDX P shares PAUPX Inst. shares PAUIX ABOUT PIMCO PIMCO is a leading global investment management firm, with offices in 11 countries throughout the Americas, Europe and Asia. Founded in 1971, PIMCO offers a wide range of innovative strategies to help millions of investors worldwide meet their needs. Our goal is to provide attractive returns while maintaining a strong culture of risk management and long-term discipline. FOR MORE INFORMATION For more information about PIMCO All Asset Strategy, talk to your investment professional, visit pimco.com or call us at PIMCO. pimco.com Investors should consider the investment objectives, risks, charges and expenses of the funds carefully before investing. This and other information are contained in the fund s prospectus and summary prospectus, if available, which may be obtained by visiting pimco.com or by contacting your PIMCO representative. Please read them carefully before you invest or send money. A word about risk: The Fund invests in other PIMCO funds and performance is subject to underlying investment weightings which will vary. The cost of investing in a fund that invests in other funds will generally be higher than the cost of investing in a fund that invests directly in individual stocks and bonds. The fund will seek exposure to commodities through commodity-linked derivatives and through a wholly owned subsidiary of the Fund organized under the laws of the Cayman Islands (the Subsidiary ). The Subsidiary is advised by PIMCO, and has the same investment objective as the Fund. The Subsidiary (unlike the Fund) may invest without limitation in commodity-linked swap agreements and other commodity-linked derivative instruments. Investing in foreign denominated and/or domiciled securities may involve heightened risk due to currency fluctuations, and economic and political risks, which may be enhanced in emerging markets. Commodities contain heightened risk including market, political, regulatory, and natural conditions, and may not be suitable for all investors. Inflation-linked bonds (ILBs) issued by a government are fixed-income securities whose principal value is periodically adjusted according to the rate of inflation; ILBs decline in value when real interest rates rise. Treasury Inflation-Protected Securities (TIPS) are ILBs issued by the U.S. Government. Derivatives and commodity-linked derivatives may involve certain costs and risks such as liquidity, interest rate, market, credit, management and the risk that a position could not be closed when most advantageous. Commodity-linked derivative instruments may involve additional costs and risks such as changes in commodity index volatility or factors affecting a particular industry or commodity, such as drought, floods, weather, livestock disease, embargoes, tariffs and international economic, political and regulatory developments. Investing in derivatives could lose more than the amount invested. The Fund is non-diversified, which means that it may concentrate its assets in a smaller number of issuers than a diversified fund. The value of fixed income securities contained in the fund can be impacted by changes in interest rates. Bonds with longer durations tend to be more sensitive and more volatile than securities with shorter durations; bond prices generally fall as interest rates rise. No part of this material may be reproduced in any form, or referred to in any other publication, without express written permission. PIMCO is a trademark of Allianz Asset Management of America L.P. in the United States and throughout the world. PIMCO Investments LLC, distributor, 1633 Broadway, New York, NY 10019, is a company of PIMCO. 2017, PIMCO CMR PB073_50196