SEC Division of Trading and Markets no-action letter: PIMCO ETF Trust

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

DIVISION OF
TRADING AND MARKETS
June 1,2009
W. John McGuire, Esq.

1111 Peoosylvania Avenue, NW .

Washington, DC 20004

Re: PIMCO ETF TRUST

File No. TP 09-54

Dear Mr.McGuire:
In your letter dated June 1,2009, as supplemented by conversations with the staffof the Division ofTrading and Markets ("Division"), PIMCOETF Trust (the "Trust") on behalf .ofitself,the Fund (as defined below), any national securities exchange or national securities· association on or through which the exchange traded shares ofthe Trust ("Shares"), may subsequently trade, and persons or entities engaging in transactions in Shares, requests exemptions from, or interpretive or no-action advice regarding Rules 101 and 102 of Regulation M under the Securities Exchange Act of 1934, as amended ("Exchange Act") in connection with secondary market transactions in Shares and the creation or redemption of Creation Units, as discussed in your letter. We have enClosed a photocopy ofyour letter. Each defined term in this letter has the same meaning as defined in your letter, unless we note otherWise. The Trust was organized on November 14, 2008, as a Delaware statutory trust. The Trust is registered with the Commission under the Investment Company Act of 1940, as amended ('.'1940 Act"), as an open-end management investment company. The Trust currently is comprised of an initialseries, the PlMCO 1-3 Year U.S. Treasury Index Fund ("Fund"). The Fund will each seek to provide total return that closely corresponds, before fees and expenses, to the total retUrn ofthe Merrill LYIJ.ch 1-3 Year U.S. TreaSury Index ("Underlying Index") by investing, normally, at least 80% ofits assets (exclusive of the minimal cash collateral held from securities lending) in the component securities ofthe Underlying Index.. The Fund may invest the remainder ofits assets in Fixed Income Securities that are not Index Component Securities, but which the Fund believes will help the Fund track its Underlying Index, as well as in cash and investment grade, liquid short-term instruments, forwards orderivatives, such as options, futures contracts or swap agreements, . and shares of affiliated bond funds. The average portfolio duration ofthe Fund will closely correspond to the duration of its Underlying Index, which as of February 28, 2009 was 1.8 years. The "total return" sought by the Fund consists of income earned on the Fund's investments, plus capital appreciation, if any, which generally arises from decreases in interest rates.