(ZROZ) PIMCO 25+ Year Zero Coupon - Ratings and Ratios

The PIMCO 25+ Year Zero Coupon U.S. Treasury Index ETF (ZROZ) is a targeted investment vehicle designed for those seeking exposure to the long end of the U.S. Treasury yield curve. It allocates at least 80% of its assets to the ICE BofA Long U.S. Treasury Principal STRIPS Index, which tracks zero-coupon securities with maturities exceeding 25 years. These STRIPS, or Separate Trading of Registered Interest and Principal Securities, represent the principal payments of U.S. Treasury bonds, offering a unique investment opportunity in the form of zero-coupon bonds. This structure means investors receive no periodic interest payments, but the bonds are redeemed at face value upon maturity, making them particularly sensitive to interest rate changes.

ZROZ is particularly suited for investors looking to hedge against inflation or seeking to capitalize on potential declines in long-term interest rates. Given its focus on long-duration securities, the fund is inherently more volatile than shorter-duration counterparts, making it a strategic addition for those with a long-term investment horizon. Managed by PIMCO, a firm renowned for its expertise in fixed-income markets, ZROZ offers the transparency and cost-efficiency typical of ETFs, with an AUM of $1.55 billion as of recent data. This fund serves as a tool for precise exposure to the long end of the Treasury market, appealing to both institutional and individual investors aiming to align their portfolios with specific macroeconomic views.