The Fund attempts to gain exposures that may vary inversely with the performance of the Fund’s benchmark (the Dow Jones Index) on a daily basis, such that the Fund will generally benefit when the benchmark is declining in value and will generally not perform well when the benchmark is rising, a result that is different from traditional mutual funds. It is possible for the Fund to experience a negative return when the benchmark is declining and vice versa. However, the Fund is not designed or expected to produce returns which replicate the inverse of the performance of the benchmark, and the degree of variation could be substantial, particularly over longer periods. This is due to factors relating to inverse correlation and compounding risk, including the effects of compounding on the performance of the Fund’s derivatives short positions for periods greater than one day, as well as the results of PIMCO’s active management of the Fund (including income and gains or losses from fixed income instruments and variations in the Fund’s level of short exposure), the impact of Fund fees and expenses, and the fact that derivatives positions in general may not correlate exactly with the benchmark. Investing in the bond market is subject to certain risks including market, interest-rate, issuer, credit, and inflation risk; investments may be worth more or less than the original cost when redeemed. The fund will seek exposure to commodities through commodity-linked derivatives and through the PIMCO Cayman Commodity Fund IV Ltd., 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. Mortgage and asset-backed securities may be sensitive to changes in interest rates, subject to early repayment risk, and their value may fluctuate in response to the market’s perception of issuer creditworthiness; while generally supported by some form of government or private guarantee there is no assurance that private guarantors will meet their obligations. 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. 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.