Outlook & Positioning for Global Investment Grade Credit Fund as of October 2025
In this article, we as PIMCO summarize our positioning and outlook for the Global Investment Grade Credit Fund as of October 2025.
Contributors:
- Macro strategies, and in particular interest rate positioning within developed markets
- Security selection within the technology sector, as exposure to a select issuer outperformed
- Exposure to securitized products, as select agency mortgage-backed securities outperformed amid a supportive market environment
Detractors:
- An underweight to the government related sector, as the sector outperformed the broader market on an excess return basis
- Security selection within the pipeline sector, as a select overweight issuer underperformed
Positioning and Outlook:
- The Fund is focused on a diversified approach against an uncertain backdrop, utilizing bottomup credit selection to emphasize well-positioned issuers and sectors.
- During the month of October, the Fund trimmed its exposure to the utility, aerospace & defense, and banking sectors. Conversely, the Fund selectively added to the wireless telecom and entertainment sectors, including via attractively priced new issues in the primary market.
- We continue to prefer sectors with asset coverage and high barriers to entry, and in particular the pipelines sector which also benefits from high earnings visibility. We also see value in select REITs, which are well positioned to navigate the ongoing de-leveraging cycle, and which have already demonstrated stabilized or improving credit fundamentals. Within financials, we are overweight select non-bank financials, with a focus on global inter-dealer brokers, which benefit from relatively stable feebased revenues, and on select leading aircraft lessors with modern, well-diversified fleets. Additionally, we remain constructive on the airline sector, and particularly airline EETCs (enhanced equipment trust certificates) secured against aircraft collateral, amid robust demand for air travel.
- Conversely, we are underweight issuers with limited upside potential, heightened re-leveraging risk, or pricing pressures, including in sectors such as pharmaceuticals, food & beverage, and diversified
manufacturing. We also remain underweight wireline telecom issuers which have faced an increasingly competitive landscape in recent years.
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