<PAGE>
PIMCO Funds Prospectus
Multi-Manager Series
April 3, 2000
Share Classes
A B C
GROWTH STOCK FUNDS
Growth Fund
Select Growth Fund
Target Fund
Opportunity Fund
BLEND STOCK FUNDS
Capital Appreciation
Mid-Cap Fund
VALUE STOCK FUNDS
Equity Income Fund
Renaissance Fund
Value Fund
Small-Cap Value Fund
ENHANCED INDEX STOCK FUNDS
Tax-Efficient Equity Fund
INTERNATIONAL STOCK FUNDS
International Fund
SECTOR-RELATED STOCK FUNDS
Innovation Fund
Global Innovation Fund
This cover is not part of the Prospectus.
[LOGO OF PIMCO FUNDS]
<PAGE>
PIMCO Funds Prospectus
PIMCO This Prospectus describes 14 mutual funds offered by PIMCO Funds:
Funds: Multi-Manager Series. The Funds provide access to the professional
Multi- investment advisory services offered by PIMCO Advisors L.P. and
Manager its investment management affiliates. As of December 31, 1999,
Series PIMCO Advisors and its affiliates managed approximately
$261 billion, including assets for 67 of the 200 largest U.S.
corporations.
April 3,
2000
The Prospectus explains what you should know about the Funds
Share before you invest. Please read it carefully.
Classes
A, B
and C
The Securities and Exchange Commission has not approved or
disapproved these securities or determined if this Prospectus is
truthful or complete. Any representation to the contrary is a
criminal offense.
PIMCO Funds: Multi-Manager Series
1
<PAGE>
Table of Contents
<TABLE>
<S> <C>
Summary Information.............................................. 3
Fund Summaries
Capital Appreciation Fund...................................... 5
Equity Income Fund............................................. 7
Global Innovation Fund......................................... 9
Growth Fund.................................................... 11
Innovation Fund................................................ 13
International Fund............................................. 15
Mid-Cap Fund................................................... 17
Opportunity Fund............................................... 19
Renaissance Fund............................................... 21
Select Growth Fund............................................. 23
Small-Cap Value Fund........................................... 25
Target Fund.................................................... 27
Tax-Efficient Equity Fund...................................... 29
Value Fund..................................................... 31
Summary of Principal Risks....................................... 33
Management of the Funds.......................................... 35
Investment Options - Class A, B and C Shares .................... 40
How Fund Shares Are Priced....................................... 42
How to Buy and Sell Shares....................................... 43
Fund Distributions............................................... 47
Tax Consequences................................................. 47
Characteristics and Risks of Securities and Investment
Techniques...................................................... 48
Financial Highlights............................................. 57
</TABLE>
Prospectus
2
<PAGE>
Summary Information
The table below lists the investment objectives and compares certain
investment characteristics of the Funds. Other important characteristics are
described in the individual Fund Summaries beginning on page 5.
<TABLE>
<CAPTION>
Approximate Approximate
PIMCO Investment Main Number of Capitalization
Fund Objective Investments Holdings Range
--------------------------------------------------------------------------------------------------------------------------------
<C> <C> <C> <S> <C> <C>
Growth Stock Growth Long-term growth of capital; Common stocks of 35-40 At least $5 billion
Funds income is an incidental companies with
consideration market
capitalizations
of at least $5
billion
-----------------------------------------------------------------------------------------------------------------
Select Growth Long-term growth of capital; Common stocks of 15-25 At least $10 billion
income is an incidental companies with
consideration market
capitalizations
of at least $10
billion
-----------------------------------------------------------------------------------------------------------------
Target Capital appreciation; no Common stocks of 40-60 Between $1 billion
consideration is given to income companies with and $10 billion
market
capitalizations
of between $1
billion and
$10 billion
-----------------------------------------------------------------------------------------------------------------
Opportunity Capital appreciation; no Common stocks of 60-100 Between $100 million
consideration is given to income companies with and $2 billion
market
capitalizations
of between $100
million and $2
billion
--------------------------------------------------------------------------------------------------------------------------------
Blend Stock Capital Appreciation Growth of capital Common stocks of 60-100 At least $1 billion
Funds companies with
market
capitalizations
of at least $1
billion that
have improving
fundamentals and
whose stock is
reasonably
valued by the
market
-----------------------------------------------------------------------------------------------------------------
Mid-Cap Growth of capital Common stocks of 60-100 More than $500 million
companies with (excluding the largest
market 200 companies)
capitalizations
of more than
$500 million
(excluding the
largest 200
companies) that
have improving
fundamentals and
whose stock is
reasonably
valued by the
market
--------------------------------------------------------------------------------------------------------------------------------
Value Stock Equity Income Current income as a primary Income-producing 40-50 More than $2 billion
Funds objective; long-term growth of common stocks of
capital as a secondary objective companies with
market
capitalizations
of more than $2
billion
-----------------------------------------------------------------------------------------------------------------
Renaissance Long-term growth of capital Common stocks of 50-80 All capitalizations
and income companies with
below-average
valuations whose
business
fundamentals are
expected to
improve
-----------------------------------------------------------------------------------------------------------------
Value Long-term growth of capital Common stocks of 40 More than $10 billion
and income companies with
market
capitalizations
of more than $10
billion and
below-average
valuations whose
business
fundamentals are
expected to
improve
-----------------------------------------------------------------------------------------------------------------
Small-Cap Value Long-term growth of capital Common stocks of 100 Between $100 million
and income companies with and $1.5 billion
market
capitalizations
of between $100
million and $1.5
billion and
below-average
price-to-
earnings ratios
relative to the
market and their
industry groups
--------------------------------------------------------------------------------------------------------------------------------
Enhanced Index Tax-Efficient Equity Maximum after-tax growth A broadly More than 200 More than $5 billion
Stock Funds of capital diversified
portfolio of at
least 200 common
stocks of
companies
represented in
the S&P 500
Index with
market
capitalizations
of more than $5
billion
--------------------------------------------------------------------------------------------------------------------------------
International International Capital appreciation through Common stocks of 200-250 More than $500 million
Stock Funds investment in an international foreign (non-
portfolio; income is an incidental U.S.) issuers
consideration (developed and
emerging markets)
with market
capitalizations
of more than
$500 million
--------------------------------------------------------------------------------------------------------------------------------
Sector-Related Innovation Capital appreciation; no Common stocks of 40 More than $200 million
Stock Funds consideration is given to income technology-
related
companies with
market
capitalizations
of more than
$200 million
-----------------------------------------------------------------------------------------------------------------
Global Innovation Capital appreciation; no Common stocks of 30-60 More than $200 million
consideration is given to income U.S. and non-
U.S. technology-
related
companies with
market
capitalizations
of more than
$200 million
</TABLE>
PIMCO Funds: Multi-Manager Series
3
<PAGE>
Summary Information (continued)
Fund Descriptions, Performance and Fees
The Funds provide a broad range of investment choices. The
following Fund Summaries identify each Fund's investment
objective, principal investments and strategies, principal risks,
performance information and fees and expenses. A more detailed
"Summary of Principal Risks" describing principal risks of
investing in the Funds begins after the Fund Summaries.
It is possible to lose money on investments in the Funds. An
investment in a Fund is not a deposit of a bank and is not
guaranteed or insured by the Federal Deposit Insurance Corporation
or any other government agency.
Prospectus
4
<PAGE>
PIMCO Capital Appreciation Fund
- --------------------------------------------------------------------------------
Principal Investment Fund Focus Approximate
Investments Objective Larger Capitalization Range
and Seeks growth of capitalization At least $1
Strategies capital common stocks billion
Fund Approximate Number Dividend
Category of Holdings Frequency
Blend Stocks 60-100 At least
annually
The Fund seeks to achieve its investment objective by normally
investing at least 65% of its assets in common stocks of companies
with larger market capitalizations that have improving
fundamentals (based on growth criteria) and whose stock is
reasonably valued by the market (based on value criteria).
In making investment decisions for the Fund, the portfolio
management team considers the 1,000 largest publicly traded
companies (in terms of market capitalization) in the U.S. The team
screens the stocks in this universe for a series of growth
criteria, such as dividend growth, earnings growth, relative
growth of earnings over time (earnings momentum) and the company's
history of meeting earnings targets (earnings surprise), and also
value criteria, such as price-to-earnings, price-to-book and
price-to-cash flow ratios. The team then selects individual stocks
by subjecting the top 10% of the stocks in the screened universe
to a rigorous analysis of company factors, such as strength of
management, competitive industry position, and business prospects,
and financial statement data, such as earnings, cash flows and
profitability. The team may interview company management in making
investment decisions. The Fund's capitalization criteria applies
at the time of investment.
The portfolio management team rescreens the universe frequently
and seeks to consistently achieve a favorable balance of growth
and value characteristics for the Fund. The team looks to sell a
stock when it falls below the median ranking, has negative
earnings surprises, or shows poor price performance relative to
all stocks in the Fund's capitalization range or to companies in
the same business sector. A stock may also be sold if its
weighting in the portfolio becomes excessive (normally above 2% of
the Fund's investments).
The Fund intends to be fully invested in common stock (aside from
certain cash management practices) and will not make defensive
investments in response to unfavorable market and other
conditions.
- --------------------------------------------------------------------------------
Principal Among the principal risks of investing in the Fund, which could
Risks adversely affect its net asset value, yield and total return, are:
. Market Risk . Growth Securities Risk . Focused
. Issuer Risk . Credit Risk Investment Risk
. Value Securities Risk . Management Risk
Please see "Summary of Principal Risks" following the Fund
Summaries for a description of these and other risks of investing
in the Fund.
- --------------------------------------------------------------------------------
Performance The top of the next page shows summary performance information for
Information the Fund in a bar chart and an Average Annual Total Returns table.
The information provides some indication of the risks of investing
in the Fund by showing changes in its performance from year to
year and by showing how the Fund's average annual returns compare
with the returns of a broad-based securities market index and an
index of similar funds. The bar chart and the information to its
right show performance of the Fund's Class A shares, but the
returns do not reflect the impact of sales charges (loads). If
they did, the returns would be lower than those shown. Unlike the
bar chart, performance for Class A, B and C shares in the Average
Annual Total Returns table reflects the impact of sales charges.
For periods prior to the inception of Class A, B and C shares
(1/20/97), performance information shown in the bar chart and
tables for those classes is based on the performance of the Fund's
Institutional Class shares, which are offered in a different
prospectus. The prior Institutional Class performance has been
adjusted to reflect the actual sales charges (in the Average
Annual Total Returns table only), distribution and/or service
(12b-1) fees, administrative fees and other expenses paid by Class
A, B and C shares. Past performance is no guarantee of future
results.
PIMCO Funds: Multi-Manager Series
5
<PAGE>
PIMCO Capital Appreciation Fund (continued)
Calendar Year Total Returns -- Class A
Highest and Lowest
Quarter Returns
(for periods shown
in the bar chart)
--------------------
Highest (10/1/99-
12/31/99) 23.73%
--------------------
Lowest (7/1/98-
9/30/98) -14.22%
[GRAPH]
1992 7.08%
1993 17.24%
1994 -4.64%
1995 36.61%
1996 26.29%
1997 33.72%
1998 17.18%
1999 22.19%
Calendar Year End (through 12/31)
Average Annual Total Returns (for periods ended 12/31/99)
<TABLE>
<S> <C> <C> <C>
Fund Inception
1 Year 5 Years (3/8/91)(/3/)
-------------------------------------------------------------------------
Class A 15.47% 25.57% 18.84%
-------------------------------------------------------------------------
Class B 16.31% 25.92% 18.89%
-------------------------------------------------------------------------
Class C 20.32% 26.07% 18.72%
-------------------------------------------------------------------------
S&P 500 Index(/1/) 21.04% 28.56% 19.75%
-------------------------------------------------------------------------
Lipper Capital Appreciation Fund Average(/2/) 41.82% 22.88% 16.55%
-------------------------------------------------------------------------
</TABLE>
(1) The S&P 500 Index is an unmanaged index of large
capitalization common stocks. It is not possible to invest
directly in the index.
(2) The Lipper Capital Appreciation Fund Average is a total return
performance average of funds tracked by Lipper Analytical
Services, Inc. that have an investment objective of maximum
capital appreciation. It does not take into account sales
charges.
(3) The Fund began operations on 3/8/91. Index comparisons begin
on 2/28/91.
- --------------------------------------------------------------------------------
Fees and
Expenses These tables describe the fees and expenses you may pay if you buy
of the and hold Class A, B or C shares of the Fund:
Fund
Shareholder Fees (fees paid directly from your investment)
<TABLE>
<S> <C> <C>
Maximum Sales Charge (Load) Imposed Maximum Contingent Deferred Sales Charge (Load)
on Purchases (as a percentage of offering price) (as a percentage of original purchase price)
------------------------------------------------------------------------------------------------------
Class A 5.50% 1%(/1/)
------------------------------------------------------------------------------------------------------
Class B None 5%(/2/)
------------------------------------------------------------------------------------------------------
Class C None 1%(/3/)
------------------------------------------------------------------------------------------------------
</TABLE>
(1) Imposed only in certain circumstances where Class A shares are
purchased without a front-end sales charge at the time of
purchase.
(2) The maximum CDSC is imposed on shares redeemed in the first
year. For shares held longer than one year, the CDSC declines
according to the schedule set forth under "Investment
Options--Class A, B and C Shares--Contingent Deferred Sales
Charges (CDSCs)--Class B Shares."
(3) The CDSC on Class C shares is imposed only on shares redeemed
in the first year.
Annual Fund Operating Expenses (expenses that are deducted from
Fund assets)
<TABLE>
<S> <C> <C> <C> <C>
Distribution Total Annual
Advisory and/or Service Other Fund Operating
Share Class Fees (12b-1) Fees(/1/) Expenses(/2/) Expenses
-----------------------------------------------------------------
Class A 0.45% 0.25% 0.40% 1.10%
-----------------------------------------------------------------
Class B 0.45 1.00 0.40 1.85
-----------------------------------------------------------------
Class C 0.45 1.00 0.40 1.85
-----------------------------------------------------------------
</TABLE>
(1) Due to the 12b-1 distribution fee imposed on Class B and Class
C shares, a Class B or Class C shareholders may, depending
upon the length of time the shares are held, pay more than the
economic equivalent of the maximum front-end sales charges
permitted by relevant rules of the National Association of
Securities Dealers, Inc.
(2) Other Expenses reflects a 0.40% Administrative Fee paid by the
class, which is subject to a reduction of 0.05% on average daily
net assets attributable in the aggregate to the Fund's Class A, B
and C shares in excess of $2.5 billion.
Examples. The Examples are intended to help you compare the cost
of investing in Class A, B or C shares of the Fund with the costs
of investing in other mutual funds. The Examples assume that you
invest $10,000 in the noted class of shares for the time periods
indicated, your investment has a 5% return each year, the
reinvestment of all dividends and distributions, and the Fund's
operating expenses remain the same. Although your actual costs may
be higher or lower, the Examples show what your costs would be
based on these assumptions.
<TABLE>
<CAPTION>
Example: Assuming you do not
Example: Assuming you redeem your shares at the end of each period redeem your shares
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Share Class Year 1 Year 3 Year 5 Year 10 Year 1 Year 3 Year 5 Year 10
-----------------------------------------------------------------------------------------------------------
Class A $656 $880 $1,123 $1,816 $656 $880 $1,123 $1,816
-----------------------------------------------------------------------------------------------------------
Class B 688 882 1,201 1,876 188 582 1,001 1,876
-----------------------------------------------------------------------------------------------------------
Class C 288 582 1,001 2,169 188 582 1,001 2,169
-----------------------------------------------------------------------------------------------------------
</TABLE>
Prospectus
6
<PAGE>
PIMCO Equity Income Fund
- --------------------------------------------------------------------------------
Principal Investment Fund Focus Approximate
Investments Objective Income producing Capitalization Range
and Seeks current common stocks More than $2
Strategies income as a with potential billion
primary for capital
objective, and appreciation
long-term growth
of capital as a
secondary
objective
Dividend Frequency
Approximate Number Quarterly
of Holdings
Fund Category 40-50
Value Stocks
The Fund seeks to achieve its investment objective by normally
investing at least 65% of its assets in income-producing (e.g.,
dividend-paying) common stocks of companies with market
capitalizations of more than $2 billion at the time of investment.
The Fund may also invest in convertible securities and preferred
stocks.
The Fund's initial selection universe consists of the 1,000
largest publicly traded companies (in terms of market
capitalization) in the U.S. The portfolio managers classify the
universe by industry. They then identify the most undervalued
stocks in each industry based mainly on relative P/E ratios,
calculated both with respect to trailing operating earnings and
forward earnings estimates. From this group of stocks, the Fund
buys approximately 25 stocks with the highest dividend yields. The
portfolio managers then screen the most undervalued companies in
each industry by dividend yield to identify the highest yielding
stocks in each industry. From this group, the Fund buys
approximately 25 additional stocks with the lowest P/E ratios.
In selecting stocks, the portfolio managers consider quantitative
factors such as price momentum (based on changes in stock price
relative to changes in overall market prices), earnings momentum
(based on analysts' earnings per share estimates and revisions to
those estimates), relative dividend yields, valuation relative to
the overall market and trading liquidity. The portfolio managers
may replace a stock when a stock within the same industry group
has a considerably higher dividend yield or lower valuation than
the Fund's current holding.
The Fund may invest up to 15% of its assets in foreign
securities, usually in the form of American Depository Receipts
(ADRs). In response to unfavorable market and other conditions,
the Fund may make temporary investments of some or all of its
assets in high-quality fixed income securities. This would be
inconsistent with the Fund's investment objective and principal
strategies.
- --------------------------------------------------------------------------------
Principal Among the principal risks of investing in the Fund, which could
Risks adversely affect its net asset value, yield and total return, are:
.Market Risk .Foreign Investment Risk .Credit Risk
.Issuer Risk .Currency Risk .Management Risk
.Value Securities Risk .Interest Rate Risk
Please see "Summary of Principal Risks" following the Fund
Summaries for a description of these and other risks of investing
in the Fund.
- --------------------------------------------------------------------------------
Performance The top of the next page shows summary performance information for
Information the Fund in a bar chart and an Average Annual Total Returns table.
The information provides some indication of the risks of investing
in the Fund by showing changes in its performance from year to
year and by showing how the Fund's average annual returns compare
with the returns of a broad-based securities market index and an
index of similar funds. The bar chart and the information to its
right show performance of the Fund's Class A shares, but the
returns do not reflect the impact of sales charges (loads). If
they did, the returns would be lower than those shown. Unlike the
bar chart, performance for Class A, B and C shares in the Average
Annual Total Returns table reflects the impact of sales charges.
For periods prior to the inception of Class A, B and C shares
(1/20/97), performance information shown in the bar chart and
tables for those classes is based on the performance of the Fund's
Institutional Class shares, which are offered in a different
prospectus. The prior Institutional Class performance has been
adjusted to reflect the actual sales charges (in the Average
Annual Total Returns table only), distribution and/or service
(12b-1) fees, administrative fees and other expenses paid by Class
A, B and C shares. The Fund is expected to change sub-advisers on
or about May 8, 2000. The Fund would not necessarily have achieved
the performance results shown on the next page under its expected
new investment management arrangements. Past performance is no
guarantee of future results.
PIMCO Funds: Multi-Manager Series
7
<PAGE>
PIMCO Equity Income Fund (continued)
Calendar Year Total Returns -- Class A
Highest and Lowest
Quarter Returns
(for periods shown
in the bar chart)
--------------------
Highest (4/1/99-
6/30/99) 16.00%
--------------------
Lowest (7/1/98-
9/30/98) -10.98%
[GRAPH]
1992 14.29%
1993 8.03%
1994 -2.00%
1995 32.94%
1996 21.00%
1997 30.88%
1998 8.03%
1999 -2.31%
Calendar Year End (through 12/31)
Average Annual Total Returns (for periods ended 12/31/99)
<TABLE>
<S> <C> <C> <C>
Fund Inception
1 Year 5 Years (3/8/91)(/3/)
-------------------------------------------------------------------
Class A -7.67% 15.99% 13.09%
-------------------------------------------------------------------
Class B -6.71% 16.26% 13.14%
-------------------------------------------------------------------
Class C -3.81% 16.45% 12.97%
-------------------------------------------------------------------
S&P 500 Index(/1/) 21.04% 28.56% 19.75%
-------------------------------------------------------------------
Lipper Equity Income Fund Average(/2/) 4.77% 18.02% 14.57%
-------------------------------------------------------------------
</TABLE>
(1) The S&P 500 Index is an unmanaged index of large
capitalization common stocks. It is not possible to invest
directly in the index.
(2) The Lipper Equity Income Fund Average is a total return
performance average of funds tracked by Lipper Analytical
Services, Inc. that seek relatively higher growth of income
through investing 60% or more of their portfolios in equities.
It does not take into account sales charges.
(3) The Fund began operations on 3/8/91. Index comparisons begin
on 2/28/91.
- --------------------------------------------------------------------------------
Fees and These tables describe the fees and expenses you may pay if you buy
Expenses and hold Class A, B or C shares of the Fund:
of the
Fund
Shareholder Fees (fees paid directly from your investment)
<TABLE>
<S> <C> <C>
Maximum Sales Charge (Load) Imposed Maximum Contingent Deferred Sales Charge (Load)
on Purchases (as a percentage of offering price) (as a percentage of original purchase price)
------------------------------------------------------------------------------------------------------
Class A 5.50% 1%(/1/)
------------------------------------------------------------------------------------------------------
Class B None 5%(/2/)
------------------------------------------------------------------------------------------------------
Class C None 1%(/3/)
------------------------------------------------------------------------------------------------------
</TABLE>
(1) Imposed only in certain circumstances where Class A shares are
purchased without a front-end sales charge at the time of
purchase.
(2) The maximum CDSC is imposed on shares redeemed in the first
year. For shares held longer than one year, the CDSC declines
according to the schedule set forth under "Investment
Options--Class A, B and C Shares--Contingent Deferred Sales
Charges (CDSCs)--Class B Shares."
(3) The CDSC on Class C shares is imposed only on shares redeemed
in the first year.
Annual Fund Operating Expenses (expenses that are deducted from
Fund assets)
<TABLE>
<S> <C> <C> <C> <C>
Distribution Total Annual
Advisory and/or Service Other Fund Operating
Share Class Fees (12b-1) Fees(/1/) Expenses(/2/) Expenses
-----------------------------------------------------------------
Class A 0.45% 0.25% 0.40% 1.10%
-----------------------------------------------------------------
Class B 0.45 1.00 0.40 1.85
-----------------------------------------------------------------
Class C 0.45 1.00 0.40 1.85
-----------------------------------------------------------------
</TABLE>
(1) Due to the 12b-1 distribution fee imposed on Class B and Class
C shares, a Class B or Class C shareholders may, depending
upon the length of time the shares are held, pay more than the
economic equivalent of the maximum front-end sales charges
permitted by relevant rules of the National Association of
Securities Dealers, Inc.
(2) Other Expenses reflects a 0.40% Administrative Fee paid by the
class, which is subject to a reduction of 0.05% on average daily
net assets attributable in the aggregate to the Fund's Class A, B
and C shares in excess of $2.5 billion.
Examples. The Examples are intended to help you compare the cost
of investing in Class A, B or C shares of the Fund with the costs
of investing in other mutual funds. The Examples assume that you
invest $10,000 in the noted class of shares for the time periods
indicated, your investment has a 5% return each year, the
reinvestment of all dividends and distributions, and the Fund's
operating expenses remain the same. Although your actual costs may
be higher or lower, the Examples show what your costs would be
based on these assumptions.
<TABLE>
<CAPTION>
Example: Assuming you do not
Example: Assuming you redeem your shares at the end of each period redeem your shares
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Share Class Year 1 Year 3 Year 5 Year 10 Year 1 Year 3 Year 5 Year 10
-----------------------------------------------------------------------------------------------------------
Class A $656 $880 $1,123 $1,816 $656 $880 $1,123 $1,816
-----------------------------------------------------------------------------------------------------------
Class B 688 882 1,201 1,876 188 582 1,001 1,876
-----------------------------------------------------------------------------------------------------------
Class C 288 582 1,001 2,169 188 582 1,001 2,169
-----------------------------------------------------------------------------------------------------------
</TABLE>
Prospectus
8
<PAGE>
PIMCO Global Innovation Fund
- --------------------------------------------------------------------------------
Principal Investment Fund Focus Approximate
Investments Objective Common stocks of Capitalization Range
and Seeks capital U.S. and non- More than $200
Strategies appreciation; no U.S. technology- million
consideration is related
given to income companies
Dividend Frequency
At least
Fund Category Approximate annually
Sector-Related Number of Holdings
Stocks 30-60
The Fund seeks to achieve its investment objective by normally
investing at least 65% of its assets in common stocks of U.S. and
non-U.S. companies which utilize new, creative or different, or
"innovative," technologies to gain a strategic competitive
advantage in their industry, as well as companies that provide and
service those technologies. The Fund identifies its investment
universe of technology-related companies primarily by reference to
classifications made by independent firms, such as Standard &
Poor's (for example, companies classified as "Information
Technology" companies), and by identifying companies that derive a
substantial portion of their revenues from the manufacture, sale
and/or service of technological products. Although the Fund
emphasizes companies which utilize technologies, it is not
required to invest exclusively in a particular business sector or
industry.
The portfolio manager selects stocks for the Fund using a
"growth" style. The portfolio manager seeks to identify
technology-related companies with well-defined "wealth creating"
characteristics, including superior earnings growth (relative to
companies in the same industry or the market as a whole), high
profitability and consistent, predictable earnings. In addition,
through fundamental research, the portfolio manager seeks to
identify companies that are gaining market share, have superior
management and possess a sustainable competitive advantage, such
as superior or innovative products, personnel and distribution
systems. The Fund looks to sell a stock when the portfolio manager
believes that earnings or market sentiment are disappointing, if
the company does not meet or exceed consensus estimates on
revenues and/or earnings or if an alternative investment is more
attractive.
Although the Fund invests principally in common stocks, the Fund
may also invest in other types of equity securities, including
preferred stocks and convertible securities. The Fund will invest
in the securities of issuers located in at least three countries
(one of which may be the United States). Although the Fund
normally invests in securities traded principally in the
securities markets of developed countries, the Fund has no
prescribed limits on geographic asset distribution and may invest
in any foreign securities market in the world, including in
emerging markets. The Fund may utilize foreign currency exchange
contracts and derivative instruments (such as stock index futures
contracts), primarily for risk management or hedging purposes.
In response to unfavorable market and other conditions, the Fund
may make temporary investments of some or all of its assets in
high-quality fixed income securities. This would be inconsistent
with the Fund's investment objective and principal strategies.
- --------------------------------------------------------------------------------
Principal Among the principal risks of investing in the Fund, which could
Risks adversely affect its net asset value, yield and total return, are:
.Market Risk .Derivatives Risk .Leveraging Risk
.Issuer Risk .Foreign Investment Risk .Credit Risk
.Growth Securities Risk .Emerging Markets Risk .Management Risk
.Smaller Company Risk .Currency Risk
.Liquidity Risk .Focused Investment Risk
Please see "Summary of Principal Risks" following the Fund
Summaries for a description of these and other risks of investing
in the Fund.
- --------------------------------------------------------------------------------
Performance
Information
The Fund commenced operations in December 1999 and does not yet
have a full calendar year of performance. Thus, no bar chart or
Average Annual Total Returns table is included for the Fund.
PIMCO Funds: Multi-Manager Series
9
<PAGE>
PIMCO Global Innovation Fund (continued)
- --------------------------------------------------------------------------------
Fees and These tables describe the fees and expenses you may pay if you buy
Expenses and hold Class A, B or C shares of the Fund:
of the
Fund
Shareholder Fees (fees paid directly from your investment)
<TABLE>
<S> <C> <C>
Maximum Sales Charge (Load) Imposed Maximum Contingent Deferred Sales Charge (Load)
on Purchases (as a percentage of offering price) (as a percentage of original purchase price)
------------------------------------------------------------------------------------------------------
Class A 5.50% 1%(/1/)
------------------------------------------------------------------------------------------------------
Class B None 5%(/2/)
------------------------------------------------------------------------------------------------------
Class C None 1%(/3/)
------------------------------------------------------------------------------------------------------
</TABLE>
(1) Imposed only in certain circumstances where Class A shares are
purchased without a front-end sales charge at the time of
purchase.
(2) The maximum CDSC is imposed on shares redeemed in the first
year. For shares held longer than one year, the CDSC declines
according to the schedule set forth under "Investment
Options--Class A, B and C Shares--Contingent Deferred Sales
Charges (CDSCs)--Class B Shares."
(3) The CDSC on Class C shares is imposed only on shares redeemed
in the first year.
Annual Fund Operating Expenses (expenses that are deducted from
Fund assets)
<TABLE>
<S> <C> <C> <C> <C> <C> <C>
Distribution Total Annual
Advisory and/or Service Other Fund Operating
Share Class Fees (12b-1) Fees(/1/) Expenses(/2/) Expenses Fee Waiver(/3/) Net Expenses(/3/)
---------------------------------------------------------------------------------------------------
Class A 1.00% 0.25% 0.64% 1.89% 0.04% 1.85%
---------------------------------------------------------------------------------------------------
Class B 1.00 1.00 0.64 2.64 0.04 2.60
---------------------------------------------------------------------------------------------------
Class C 1.00 1.00 0.64 2.64 0.04 2.60
---------------------------------------------------------------------------------------------------
</TABLE>
(1) Due to the 12b-1 distribution fee imposed on Class B and Class
C shares, a Class B or Class C shareholders may, depending
upon the length of time the shares are held, pay more than the
economic equivalent of the maximum front-end sales charges
permitted by relevant rules of the National Association of
Securities Dealers, Inc.
(2) Other Expenses reflects a 0.60% Administrative Fee paid by the
class, which is subject to a reduction of 0.05% on average daily
net assets attributable in the aggregate to the Fund's Class A, B
and C shares in excess of $2.5 billion, and 0.04% representing
the Fund's organizational expenses as attributed to the class
("Organizational Expenses").
(3) Net Expenses reflects the effects of a contractual agreement
by PIMCO Advisors to waive, reduce or reimburse its
Administrative Fee for each class in an amount that, in
essence, is equal to the Fund's Organizational Expenses
attributed to the class. Because the Organizational Expenses
will all be accounted for in the Fund's initial fiscal year,
the Fund's reasonable expectation is that the relevant
conditions will not continue after the Fund's fiscal year
ending June 30, 2000.
Examples. The Examples are intended to help you compare the cost
of investing in Class A, B or C shares of the Fund with the costs
of investing in other mutual funds. The Examples assume that you
invest $10,000 in the noted class of shares for the time periods
indicated, your investment has a 5% return each year, the
reinvestment of all dividends and distributions, and the Fund's
operating expenses remain the same. Although your actual costs may
be higher or lower, the Examples show what your costs would be
based on these assumptions.(/1/)
<TABLE>
<CAPTION>
Example: Assuming you
do not redeem your
Example: Assuming you redeem your shares at the end of each period shares
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Share Class Year 1 Year 3 Year 1 Year 3
------------------------------------------------------------------------------------------------------
Class A 728 $ 1,100 $728 $1,100
------------------------------------------------------------------------------------------------------
Class B 763 1,108 263 808
------------------------------------------------------------------------------------------------------
Class C 363 808 263 808
------------------------------------------------------------------------------------------------------
</TABLE>
(1)The Examples are based on the Net Expenses shown in the
preceding table.
Prospectus
10
<PAGE>
PIMCO Growth Fund
- --------------------------------------------------------------------------------
Principal Investment Fund Focus Approximate
Investments Objective Larger Capitalization
and Seeks long-term capitalization Range
Strategies growth of common At least $5
capital; income stocks billion
is an
incidental
consideration
Dividend
Frequency
Approximate Number At least
of Holdings annually
Fund Category 35-40
Growth Stocks
The Fund seeks to achieve its investment objective by normally
investing at least 65% of its assets in common stocks of "growth"
companies with market capitalizations of at least $5 billion at
the time of investment.
The portfolio manager selects stocks for the Fund using a
"growth" style. The portfolio manager seeks to identify companies
with well-defined "wealth creating" characteristics, including
superior earnings growth (relative to companies in the same
industry or the market as a whole), high profitability and
consistent, predictable earnings. In addition, through fundamental
research, the portfolio manager seeks to identify companies that
are gaining market share, have superior management and possess a
sustainable competitive advantage, such as superior or innovative
products, personnel and distribution systems. The Fund looks to
sell a stock when the portfolio manager believes that its
earnings, market sentiment or relative performance are
disappointing or if an alternative investment is more attractive.
The Fund may also invest in other kinds of equity securities,
including preferred stocks and convertible securities. The Fund
may invest up to 15% of its assets in foreign securities, usually
in the form of American Depository Receipts (ADRs).
In response to unfavorable market and other conditions, the Fund
may make temporary investments of some or all of its assets in
high-quality fixed income securities. This would be inconsistent
with the Fund's investment objective and principal strategies.
- --------------------------------------------------------------------------------
Principal Among the principal risks of investing in the Fund, which could
Risks adversely affect its net asset value, yield and total return, are:
.Market Risk .Foreign Investment Risk .Credit Risk
.Issuer Risk .Currency Risk .Management Risk
.Growth Securities Risk .Focused Investment Risk
Please see "Summary of Principal Risks" following the Fund
Summaries for a description of these and other risks of investing
in the Fund.
- --------------------------------------------------------------------------------
Performance Information
The top of the next page shows summary performance information for
the Fund in a bar chart and an Average Annual Total Returns table.
The information provides some indication of the risks of investing
in the Fund by showing changes in its performance from year to
year and by showing how the Fund's average annual returns compare
with the returns of a broad-based securities market index and an
index of similar funds. The bar chart and the information to its
right show performance of the Fund's Class C shares, but the
returns do not reflect the impact of sales charges (loads). If
they did, the returns would be lower than those shown. Unlike the
bar chart, performance for Class A, B and C shares in the Average
Annual Total Returns table reflects the impact of sales charges.
For periods prior to the inception of Class A shares (10/26/90)
and Class B shares (5/23/95), performance information shown in the
Average Annual Total Returns table for those classes is based on
the performance of the Fund's Class C shares. The prior Class C
performance has been adjusted to reflect the actual sales charges,
distribution and/or service (12b-1) fees, administrative fees and
other expenses paid by Class A and B shares. Prior to March 6,
1999, the Fund had a different sub-adviser and would not
necessarily have achieved the performance results shown on the
next page under its current investment management arrangements.
Past performance is no guarantee of future results.
PIMCO Funds: Multi-Manager Series
11
<PAGE>
PIMCO Growth Fund (continued)
Calendar Year Total Returns -- Class C
Highest and Lowest
Quarter Returns
(for periods shown
in the bar chart)
--------------------
Highest (10/1/99-
12/31/99) 36.21%
--------------------
Lowest (7/1/90-
9/30/90) -13.14%
[GRAPH]
1990 0.29%
1991 41.88%
1992 2.08%
1993 9.32%
1994 -0.75%
1995 27.47%
1996 17.52%
1997 21.84%
1998 38.90%
1999 39.83%
Calendar Year End (through12/31)
Average Annual Total Returns (for periods ended 12/31/99)
<TABLE>
<S> <C> <C> <C> <C>
Fund Inception
1 Year 5 Years 10 Years (2/24/84)(/3/)
--------------------------------------------------------------------
Class A 33.33% 28.36% 18.99% 19.71%
--------------------------------------------------------------------
Class B 34.78% 28.65% 19.06% 19.75%
--------------------------------------------------------------------
Class C 38.83% 28.80% 18.77% 19.25%
--------------------------------------------------------------------
S&P 500 Index(/1/) 21.04% 28.56% 18.21% 18.60%
--------------------------------------------------------------------
Lipper Growth Fund Average(/2/) 29.23% 25.03% 16.48% 16.27%
--------------------------------------------------------------------
</TABLE>
(1) The S&P 500 Index is an unmanaged index of large
capitalization common stocks. It is not possible to invest
directly in the index.
(2) The Lipper Growth Fund Average is a total return performance
average of funds tracked by Lipper Analytical Services, Inc.
that invest in companies with long-term earnings expected to
grow significantly faster than the earnings of the stocks
represented in the major unmanaged stock indexes. It does not
take into account sales charges.
(3) The Fund began operations on 2/24/84. Index comparisons begin
on 2/29/84.
- --------------------------------------------------------------------------------
Fees and These tables describe the fees and expenses you may pay if you buy
Expenses and hold Class A, B or C shares of the Fund:
of the
Fund
Shareholder Fees (fees paid directly from your investment)
<TABLE>
<S> <C> <C>
Maximum Sales Charge (Load) Imposed Maximum Contingent Deferred Sales Charge (Load)
on Purchases (as a percentage of offering price) (as a percentage of original purchase price)
------------------------------------------------------------------------------------------------------
Class A 5.50% 1%(/1/)
------------------------------------------------------------------------------------------------------
Class B None 5%(/2/)
------------------------------------------------------------------------------------------------------
Class C None 1%(/3/)
------------------------------------------------------------------------------------------------------
</TABLE>
(1) Imposed only in certain circumstances where Class A shares are
purchased without a front-end sales charge at the time of
purchase.
(2) The maximum CDSC is imposed on shares redeemed in the first
year. For shares held longer than one year, the CDSC declines
according to the schedule set forth under "Investment
Options--Class A, B and C Shares--Contingent Deferred Sales
Charges (CDSCs)--Class B Shares."
(3) The CDSC on Class C shares is imposed only on shares redeemed
in the first year.
Annual Fund Operating Expenses (expenses that are deducted from
Fund assets)
<TABLE>
<S> <C> <C> <C> <C>
Distribution Total Annual
Advisory and/or Service Other Fund Operating
Share Class Fees (12b-1) Fees(/1/) Expenses(/2/) Expenses
-----------------------------------------------------------------
Class A 0.50% 0.25% 0.40% 1.15%
-----------------------------------------------------------------
Class B 0.50 1.00 0.40 1.90
-----------------------------------------------------------------
Class C 0.50 1.00 0.40 1.90
-----------------------------------------------------------------
</TABLE>
(1) Due to the 12b-1 distribution fee imposed on Class B and Class
C shares, a Class B or Class C shareholder may, depending upon
the length of time the shares are held, pay more than the
economic equivalent of the maximum front-end sales charges
permitted by relevant rules of the National Association of
Securities Dealers, Inc.
(2) Other Expenses reflects a 0.40% Administrative Fee paid by the
class, which is subject to a reduction of 0.05% on average daily
net assets attributable in the aggregate to the Fund's Class A, B
and C shares in excess of $2.5 billion.
Examples. The Examples are intended to help you compare the cost
of investing in Class A, B or C shares of the Fund with the costs
of investing in other mutual funds. The Examples assume that you
invest $10,000 in the noted class of shares for the time periods
indicated, your investment has a 5% return each year, the
reinvestment of all dividends and distributions, and the Fund's
operating expenses remain the same. Although your actual costs may
be higher or lower, the Examples show what your costs would be
based on these assumptions.
<TABLE>
<CAPTION>
Example: Assuming you do not
Example: Assuming you redeem your shares at the end of each period redeem your shares
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Share Class Year 1 Year 3 Year 5 Year 10 Year 1 Year 3 Year 5 Year 10
-----------------------------------------------------------------------------------------------------------
Class A $661 $895 $1,148 $1,871 $661 $895 $1,148 $1,871
-----------------------------------------------------------------------------------------------------------
Class B 693 897 1,226 1,930 193 597 1,026 1,930
-----------------------------------------------------------------------------------------------------------
Class C 293 597 1,026 2,222 193 597 1,026 2,222
-----------------------------------------------------------------------------------------------------------
</TABLE>
Prospectus
12
<PAGE>
PIMCO Innovation Fund
- --------------------------------------------------------------------------------
Principal Investment Fund Focus Approximate
Investments Objective Common stocks of Capitalization Range
and Seeks capital technology- More than $200
Strategies appreciation; no related million
consideration is companies
given to income
Fund Category Approximate Number Dividend Frequency
Sector-Related of Holdings At least
Stocks 40 annually
The Fund seeks to achieve its investment objective by normally
investing at least 65% of its assets in common stocks of companies
which utilize new, creative or different, or "innovative,"
technologies to gain a strategic competitive advantage in their
industry, as well as companies that provide and service those
technologies. The Fund identifies its investment universe of
technology-related companies primarily by reference to
classifications made by independent firms, such as Standard &
Poor's (for example, companies classified as "Information
Technology" companies), and by identifying companies that derive a
substantial portion of their revenues from the manufacture, sale
and/or service of technological products. Although the Fund
emphasizes companies which utilize technologies, it is not
required to invest exclusively in companies in a particular
business sector or industry.
The portfolio manager selects stocks for the Fund using a
"growth" style. The portfolio manager seeks to identify
technology-related companies with well-defined "wealth creating"
characteristics, including superior earnings growth (relative to
companies in the same industry or the market as a whole), high
profitability and consistent, predictable earnings. In addition,
through fundamental research, the portfolio manager seeks to
identify companies that are gaining market share, have superior
management and possess a sustainable competitive advantage, such
as superior or innovative products, personnel and distribution
systems. The Fund looks to sell a stock when the portfolio manager
believes that earnings or market sentiment are disappointing, if
the company does not meet or exceed consensus estimates on
revenues and/or earnings or if an alternative investment is more
attractive.
Although the Fund invests principally in common stocks, the Fund
may also invest in other kinds of equity securities, including
preferred stocks and convertible securities. The Fund may invest
up to 15% of its assets in foreign securities, usually in the form
of American Depository Receipts (ADRs).
In response to unfavorable market and other conditions, the Fund
may make temporary investments of some or all of its assets in
high-quality fixed income securities. This would be inconsistent
with the Fund's investment objective and principal strategies.
- --------------------------------------------------------------------------------
Principal Among the principal risks of investing in the Fund, which could
Risks adversely affect its net asset value, yield and total return, are:
.Market Risk .Smaller Company Risk .Currency Risk
.Issuer Risk .Liquidity Risk .Credit Risk
.Focused Investment Risk .Foreign Investment Risk .Management Risk
.Growth Securities Risk
Please see "Summary of Principal Risks" following the Fund
Summaries for a description of these and other risks of investing
in the Fund.
- --------------------------------------------------------------------------------
Performance The top of the next page shows summary performance information for
Information the Fund in a bar chart and an Average Annual Total Returns table.
The information provides some indication of the risks of investing
in the Fund by showing changes in its performance from year to
year and by showing how the Fund's average annual returns compare
with the returns of a broad-based securities market index and an
index of similar funds. The bar chart and the information to its
right show performance of the Fund's Class A shares, but the
returns do not reflect the impact of sales charges (loads). If
they did, the returns would be lower than those shown. Unlike the
bar chart, performance for Class A, B and C shares in the Average
Annual Total Returns table reflects the impact of sales charges.
For periods prior to the inception of Class B shares (5/22/95),
performance information shown in the Average Annual Total Returns
table for that class is based on the performance of the Fund's
Class A shares. The prior Class A performance has been adjusted to
reflect the actual sales charges, distribution and/or service
(12b-1) fees, administrative fees and other expenses paid by Class
B shares. Prior to March 6, 1999, the Fund had a different sub-
adviser and would not necessarily have achieved the performance
results shown on the next page under its current investment
management arrangements. Past performance is no guarantee of
future results.
PIMCO Funds: Multi-Manager Series
13
<PAGE>
PIMCO Innovation Fund (continued)
Calendar Year Total Returns -- Class A
Highest and
Lowest Quarter
Returns
(for periods
shown in the bar
chart)
------------------
Highest (10/1/99-
12/31/99) 80.12%
------------------
Lowest (1/1/97-
3/31/97) -12.56%
[GRAPH]
1995 45.33%
1996 23.60%
1997 9.03%
1998 69.54%
1999 139.40%
Calendar Year End (through 12/31)
Average Annual Total Returns (for periods ended 12/31/99)
<TABLE>
<S> <C> <C> <C>
Fund Inception
1 Year 5 Years (12/22/94)(/3/)
-----------------------------------------------------------------------------
Class A 126.24% 51.38% 51.01%
-----------------------------------------------------------------------------
Class B 133.51% 51.98% 51.65%
-----------------------------------------------------------------------------
Class C 137.44% 52.05% 51.68%
-----------------------------------------------------------------------------
S&P 500 Index(/1/) 21.04% 28.56% 28.56%
-----------------------------------------------------------------------------
Lipper Science and Technology Fund Average(/2/) 134.99% 40.91% 40.91%
-----------------------------------------------------------------------------
</TABLE>
(1) The S&P 500 Index is an unmanaged index of large
capitalization common stocks. It is not possible to invest
directly in the index.
(2) The Lipper Science and Technology Fund Average is a total
return performance average of funds tracked by Lipper
Analytical Services, Inc. that invest at least 65% of their
assets in science and technology stocks. It does not take into
account sales charges.
(3) The Fund began operations on 12/22/94. Index comparisons begin
on 12/31/94.
- --------------------------------------------------------------------------------
Fees and These tables describe the fees and expenses you may pay if you buy
Expenses and hold Class A, B or C shares of the Fund:
of the
Fund
Shareholder Fees (fees paid directly from your investment)
<TABLE>
<S> <C> <C>
Maximum Sales Charge (Load) Imposed Maximum Contingent Deferred Sales Charge (Load)
on Purchases (as a percentage of offering price) (as a percentage of original purchase price)
------------------------------------------------------------------------------------------------------
Class A 5.50% 1%(/1/)
------------------------------------------------------------------------------------------------------
Class B None 5%(/2/)
------------------------------------------------------------------------------------------------------
Class C None 1%(/3/)
------------------------------------------------------------------------------------------------------
</TABLE>
(1) Imposed only in certain circumstances where Class A shares are
purchased without a front-end sales charge at the time of
purchase.
(2) The maximum CDSC is imposed on shares redeemed in the first
year. For shares held longer than one year, the CDSC declines
according to the schedule set forth under "Investment
Options--Class A, B and C Shares--Contingent Deferred Sales
Charges (CDSCs)--Class B Shares."
(3) The CDSC on Class C shares is imposed only on shares redeemed
in the first year.
Annual Fund Operating Expenses (expenses that are deducted from
Fund assets)
<TABLE>
<S> <C> <C> <C> <C>
Distribution Total Annual
Advisory and/or Service Other Fund Operating
Share Class Fees (12b-1) Fees(/1/) Expenses(/2/) Expenses
-----------------------------------------------------------------
Class A 0.65% 0.25% 0.40% 1.30%
-----------------------------------------------------------------
Class B 0.65 1.00 0.40 2.05
-----------------------------------------------------------------
Class C 0.65 1.00 0.40 2.05
-----------------------------------------------------------------
</TABLE>
(1) Due to the 12b-1 distribution fee imposed on Class B and Class
C shares, a Class B or Class C shareholders may, depending
upon the length of time the shares are held, pay more than the
economic equivalent of the maximum front-end sales charges
permitted by relevant rules of the National Association of
Securities Dealers, Inc.
(2) Other Expenses reflects a 0.40% Administrative Fee paid by the
class, which is subject to a reduction of 0.05% on average daily
net assets attributable in the aggregate to the Fund's Class A, B
and C shares in excess of $2.5 billion.
Examples. The Examples are intended to help you compare the cost
of investing in Class A, B or C shares of the Fund with the costs
of investing in other mutual funds. The Examples assume that you
invest $10,000 in the noted class of shares for the time periods
indicated, your investment has a 5% return each year, the
reinvestment of all dividends and distributions, and the Fund's
operating expenses remain the same. Although your actual costs may
be higher or lower, the Examples show what your costs would be
based on these assumptions.
<TABLE>
<CAPTION>
Example: Assuming you do not
Example: Assuming you redeem your shares at the end of each period redeem your shares
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Year 1 Year 3 Year 5 Year 10 Year 1 Year 3 Year 5 Year 10
-------------------------------------------------------------------------------------------------------
Class A $675 $939 $1,224 $2,032 $675 $939 $1,224 $2,032
-------------------------------------------------------------------------------------------------------
Class B 708 943 1,303 2,091 208 643 1,103 2,091
-------------------------------------------------------------------------------------------------------
Class C 308 643 1,103 2,379 208 643 1,103 2,379
-------------------------------------------------------------------------------------------------------
</TABLE>
Prospectus
14
<PAGE>
PIMCO International Fund
- --------------------------------------------------------------------------------
Principal Investment Fund Focus Approximate
Investments Objective Common stocks of Capitalization Range
and Seeks capital foreign (non- More than $500
Strategies appreciation U.S.) issuers million
through
investment in an
international
portfolio; income
is an incidental
consideration
Dividend Frequency
Approximate Number At least
of Holdings annually
200-250
Fund Category
International
Stocks
The Fund seeks to achieve its investment objective by normally
investing at least 65% of its assets in an international portfolio
of common stocks, which may or may not pay dividends. The Fund
normally invests in securities traded principally in developed
foreign securities markets, but may also invest up to 30% of its
assets in developing or "emerging" markets. The Fund has no
prescribed limits on geographic asset distribution and may invest
in any foreign securities market in the world. The Fund may also
invest in securities of foreign issuers traded on U.S. securities
markets, but will normally not invest in U.S. issuers. The Fund
invests most of its assets in foreign securities which trade in
currencies other than the U.S. dollar and may invest directly in
foreign currencies.
The portfolio manager uses a "top down" investment approach. He
first determines regional and country weightings for the Fund by
considering such factors as the condition and growth potential of
the various economies and securities markets, currency and
taxation considerations and other financial, social, national and
political factors. The Sub-Adviser's country specialists then
select individual stocks to fill out the desired country
weightings. In selecting stocks, the specialists analyze a broad
range of company fundamentals, such as price-to-earnings, price-
to-book value and price-to-cash flow ratios (value factors),
earnings, dividend and profit growth (growth factors) and balance
sheet strength and return on assets (quality factors). The
portfolio manager sells stocks in order to adjust or rebalance the
Fund's regional and country weightings or to replace companies
with weakening fundamentals.
The Fund may utilize foreign currency exchange contracts and
derivative instruments (such as stock index futures contracts)
primarily for risk management or hedging purposes. The Fund may
also invest in equity securities other than common stocks (such as
preferred stocks and convertible securities) and may invest up to
10% of its assets in other investment companies. In response to
unfavorable market and other conditions, the Fund may make
temporary investments of some or all of its assets in foreign and
domestic fixed income securities and in equity securities of U.S.
issuers. This would be inconsistent with the Fund's investment
objective and principal strategies.
- --------------------------------------------------------------------------------
Principal Among the principal risks of investing in the Fund, which could
Risks adversely affect its net asset value, yield and total return, are:
.Foreign Investment Risk .Growth Securities Risk .Focused
.Currency Risk .Smaller Companies Risk Investment Risk
.Market Risk .Liquidity Risk .Leveraging Risk
.Issuer Risk .Derivatives Risk .Credit Risk
.Value Securities Risk .Management Risk
Please see "Summary of Principal Risks" following the Fund
Summaries for a description of these and other risks of investing
in the Fund.
- --------------------------------------------------------------------------------
Performance The top of the next page shows summary performance information for
Information the Fund in a bar chart and an Average Annual Total Returns table.
The information provides some indication of the risks of investing
in the Fund by showing changes in its performance from year to
year and by showing how the Fund's average annual returns compare
with the returns of a broad-based securities market index and an
index of similar funds. The bar chart and the information to its
right show performance of the Fund's Class C shares, but the
returns do not reflect the impact of sales charges (loads). If
they did, the returns would be lower than those shown. Unlike the
bar chart, performance for Class A, B and C shares in the Average
Annual Total Returns table reflects the impact of sales charges.
For periods prior to the inception of Class A shares (2/1/91) and
Class B shares (5/22/95), performance information shown in the
Average Annual Total Returns table for those classes is based on
the performance of the Fund's Class C shares. The prior Class C
performance has been adjusted to reflect the actual sales charges,
distribution and/or service (12b-1) fees, administrative fees and
other expenses paid by Class A and B shares. The Fund had
different sub-advisers during the periods prior to November 15,
1994, and would not necessarily have achieved the performance
results shown on the next page under its current investment
management arrangements. Past performance is no guarantee of
future results.
PIMCO Funds: Multi-Manager Series
15
<PAGE>
PIMCO International Fund (continued)
Calendar Year Total Returns -- Class C
Highest and Lowest
Quarter Returns
(for periods shown
in the bar chart)
--------------------
Highest (10/1/99-
12/31/99) 21.58%
--------------------
Lowest (7/1/98-
9/30/98) -22.16%
[GRAPH]
1990 -15.50%
1991 19.92%
1992 -5.84%
1993 33.47%
1994 -8.16%
1995 5.79%
1996 5.76%
1997 1.85%
1998 8.27%
1999 27.00%
Calendar Year End (through 12/31)
Average Annual Total Returns (for periods ended 12/31/99)
<TABLE>
<S> <C> <C> <C> <C>
Fund Inception
1 Year 5 Years 10 Years (8/25/86)(/3/)
--------------------------------------------------------------
Class A 20.59% 8.96% 6.43% 8.17%
--------------------------------------------------------------
Class B 21.97% 9.13% 6.49% 8.21%
--------------------------------------------------------------
Class C 26.00% 9.40% 6.24% 7.83%
--------------------------------------------------------------
MSCI EAFE Index 27.31% 13.15% 7.34% 10.35%
--------------------------------------------------------------
Lipper International Fund
Average(/2/) 40.86% 15.08% 10.22% 11.57%
--------------------------------------------------------------
</TABLE>
(1) The Morgan Stanley Capital International EAFE (Europe,
Australasia, Far East) ("MSCI EAFE") Index is a widely
recognized, unmanaged index of issuers in countries of Europe,
Australia and Asia. It is not possible to invest directly in
the index.
(2) The Lipper International Fund Average is a total return
performance average of funds tracked by Lipper Analytical
Services, Inc. that invest their assets in securities whose
primary trading markets are outside of the United States. It
does not take into account sales charges.
(3) The Fund began operations on 8/25/86. Index comparisons begin
on 8/31/86.
- --------------------------------------------------------------------------------
Fees and These tables describe the fees and expenses you may pay if you buy
Expenses and hold Class A, B or C shares of the Fund:
of the
Fund
Shareholder Fees (fees paid directly from your investment)
<TABLE>
<S> <C> <C>
Maximum Sales Charge (Load) Imposed Maximum Contingent Deferred Sales Charge (Load)
on Purchases (as a percentage of offering price) (as a percentage of original purchase price)
------------------------------------------------------------------------------------------------------
Class A 5.50% 1%(/1/)
------------------------------------------------------------------------------------------------------
Class B None 5%(/2/)
------------------------------------------------------------------------------------------------------
Class C None 1%(/3/)
------------------------------------------------------------------------------------------------------
</TABLE>
(1) Imposed only in certain circumstances where Class A shares are
purchased without a front-end sales charge at the time of
purchase.
(2) The maximum CDSC is imposed on shares redeemed in the first
year. For shares held longer than one year, the CDSC declines
according to the schedule set forth under "Investment
Options--Class A, B and C Shares--Contingent Deferred Sales
Charges (CDSCs)--Class B Shares."
(3) The CDSC on Class C shares is imposed only on shares redeemed
in the first year.
Annual Fund Operating Expenses (expenses that are deducted from
Fund assets)
<TABLE>
<S> <C> <C> <C> <C>
Distribution Total Annual
Advisory and/or Service Other Fund Operating
Share Class Fees (12b-1) Fees (/1/) Expenses(/2/) Expenses
------------------------------------------------------------------
Class A 0.55% 0.25% 0.65% 1.45%
------------------------------------------------------------------
Class B 0.55 1.00 0.65 2.20
------------------------------------------------------------------
Class C 0.55 1.00 0.65 2.20
------------------------------------------------------------------
</TABLE>
(1) Due to the 12b-1 distribution fee imposed on Class B and Class
C shares, a Class B or Class C shareholders may, depending
upon the length of time the shares are held, pay more than the
economic equivalent of the maximum front-end sales charges
permitted by relevant rules of the National Association of
Securities Dealers, Inc.
(2) Other Expenses reflects a 0.65% Administrative Fee paid by the
class, which is subject to a reduction of 0.05% on average daily
net assets attributable in the aggregate to the Fund's Class A, B
and C shares in excess of $2.5 billion.
Examples. The Examples are intended to help you compare the cost
of investing in Class A, B or C shares of the Fund with the costs
of investing in other mutual funds. The Examples assume that you
invest $10,000 in the noted class of shares for the time periods
indicated, your investment has a 5% return each year, the
reinvestment of all dividends and distributions, and the Fund's
operating expenses remain the same. Although your actual costs may
be higher or lower, the Examples show what your costs would be
based on these assumptions.
<TABLE>
<CAPTION>
Example: Assuming you redeem your shares at the
end of each period Example: Assuming you do not redeem your shares
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Share Class Year 1 Year 3 Year 5 Year 10 Year 1 Year 3 Year 5 Year 10
----------------------------------------------------------------------------------------------------------
Class A $689 $983 $ 1,299 $2,190 $689 $983 $1,299 $2,190
----------------------------------------------------------------------------------------------------------
Class B 723 988 1,380 2,249 223 688 1,180 2,249
----------------------------------------------------------------------------------------------------------
Class C 323 688 1,180 2,534 223 688 1,180 2,534
----------------------------------------------------------------------------------------------------------
</TABLE>
Prospectus
16
<PAGE>
PIMCO Mid-Cap Fund
- --------------------------------------------------------------------------------
Principal Investment Fund Approximate
Investments Objective Focus Capitalization Range
and Seeks growth of Medium More than $500
Strategies capital capitalization million
common stocks (excluding the
largest 200
companies)
Fund Category Approximate Number
Blend Stocks of Holdings
60-100 Dividend Frequency
At least
annually
The Fund seeks to achieve its investment objective by normally
investing at least 65% of its assets in common stocks of companies
with medium market capitalizations that have improving
fundamentals (based on growth criteria) and whose stock is
reasonably valued by the market (based on value criteria).
In making investment decisions for the Fund, the portfolio
management team considers companies in the U.S. market with market
capitalizations of more than $500 million, but excluding the 200
largest capitalization companies. The team screens the stocks in
this universe for a series of growth criteria, such as dividend
growth, earnings growth, relative growth of earnings over time
(earnings momentum) and the company's history of meeting earnings
targets (earnings surprise), and also value criteria, such as
price-to-earnings, price-to-book and price-to-cash flow ratios.
The team then selects individual stocks by subjecting the top 10%
of the stocks in the screened universe to a rigorous analysis of
company factors, such as strength of management, competitive
industry position, and business prospects, and financial statement
data, such as earnings, cash flows and profitability. The team may
interview company management in making investment decisions. The
Fund's capitalization criteria applies at the time of investment.
The portfolio management team rescreens the universe frequently
and seeks to consistently achieve a favorable balance of growth
and value characteristics for the Fund. The team looks to sell a
stock when it falls below the median ranking, has negative
earnings surprises, or shows poor price performance relative to
all stocks in the Fund's capitalization range or to companies in
the same business sector. A stock may also be sold if its
weighting in the portfolio becomes excessive (normally above 2% of
the Fund's investments).
The Fund intends to be fully invested in common stock (aside from
certain cash management practices) and will not make defensive
investments in response to unfavorable market and other
conditions.
- --------------------------------------------------------------------------------
Principal Among the principal risks of investing in the Fund, which could
Risks adversely affect its net asset value, yield and total return, are:
.Market Risk .Growth Securities Risk .Credit Risk
.Issuer Risk .Smaller Company Risk .Management Risk
.Value Securities Risk .Liquidity Risk .Focused Investment
Risk
Please see "Summary of Principal Risks" following the Fund
Summaries for a description of these and other risks of investing
in the Fund.
- --------------------------------------------------------------------------------
Performance The top of the next page shows summary performance information for
Information the Fund in a bar chart and an Average Annual Total Returns table.
The information provides some indication of the risks of investing
in the Fund by showing changes in its performance from year to
year and by showing how the Fund's average annual returns compare
with the returns of a broad-based securities market index and an
index of similar funds. The bar chart and the information to its
right show performance of the Fund's Class A shares, but the
returns do not reflect the impact of sales charges (loads). If
they did, the returns would be lower than those shown. Unlike the
bar chart, performance for Class A, B and C shares in the Average
Annual Total Returns table reflects the impact of sales charges.
For periods prior to the inception of Class A, B and C shares
(1/13/97), performance information shown in the bar chart and
tables for those classes is based on the performance of the Fund's
Institutional Class shares, which are offered in a different
prospectus. The prior Institutional Class performance has been
adjusted to reflect the actual sales charges (in the Average
Annual Total Returns table only), distribution and/or service
(12b-1) fees, administrative fees and other expenses paid by Class
A, B and C shares. Past performance is no guarantee of future
results.
PIMCO Funds: Multi-Manager Series
17
<PAGE>
PIMCO Mid-Cap Fund (continued)
Calendar Year Total Returns -- Class A
Highest and Lowest
Quarter Returns
(for periods shown
in the bar chart)
--------------------
Highest (10/1/99-
12/31/99) 22.92%
--------------------
Lowest (7/1/98-
9/30/98) -14.50%
[GRAPH]
1992 8.75%
1993 15.32%
1994 -2.75%
1995 36.76%
1996 22.87%
1997 33.62%
1998 7.46%
1999 12.54%
Calendar Year End (through 12/31)
Average Annual Total Returns (for periods ended 12/31/99)
<TABLE>
<S> <C> <C> <C>
Fund Inception
1 Year 5 Years (8/26/91)(/3/)
-----------------------------------------------------------------
Class A 6.35% 20.74% 16.33%
-----------------------------------------------------------------
Class B 6.68% 21.03% 16.39%
-----------------------------------------------------------------
Class C 10.68% 21.22% 16.25%
-----------------------------------------------------------------
Russell Mid-Cap Index(/1/) 18.23% 21.85% 17.31%
-----------------------------------------------------------------
Lipper Mid-Cap Fund Average(/2/) 39.38% 23.07% 16.94%
-----------------------------------------------------------------
</TABLE>
(1) The Russell Mid-Cap Index is an unmanaged index of middle
capitalization U.S. stocks. It is not possible to invest
directly in the index.
(2) The Lipper Mid-Cap Fund Average is a total return performance
average of funds tracked by Lipper Analytical Services, Inc.
that invest primarily in companies with market capitalizations
of less than $5 billion at the time of investment. It does not
take into account sales charges.
(3) The Fund began operations on 8/26/91. Index comparisons begin
on 8/31/91.
- --------------------------------------------------------------------------------
Fees and These tables describe the fees and expenses you may pay if you buy
Expenses and hold Class A, B or C shares of the Fund:
of the
Fund
Shareholder Fees (fees paid directly from your investment)
<TABLE>
<S> <C> <C>
Maximum Sales Charge (Load) Imposed Maximum Contingent Deferred Sales Charge (Load)
on Purchases (as a percentage of offering price) (as a percentage of original purchase price)
------------------------------------------------------------------------------------------------------
Class A 5.50% 1%(/1/)
------------------------------------------------------------------------------------------------------
Class B None 5%(/2/)
------------------------------------------------------------------------------------------------------
Class C None 1%(/3/)
------------------------------------------------------------------------------------------------------
</TABLE>
(1) Imposed only in certain circumstances where Class A shares are
purchased without a front-end sales charge at the time of
purchase.
(2) The maximum CDSC is imposed on shares redeemed in the first
year. For shares held longer than one year, the CDSC declines
according to the schedule set forth under "Investment
Options--Class A, B and C Shares--Contingent Deferred Sales
Charges (CDSCs)--Class B Shares."
(3) The CDSC on Class C shares is imposed only on shares redeemed
in the first year.
Annual Fund Operating Expenses (expenses that are deducted from
Fund assets)
<TABLE>
<S> <C> <C> <C> <C>
Distribution Total Annual
Advisory and/or Service Other Fund Operating
Share Class Fees (12b-1) Fees(/1/) Expenses(/2/) Expenses
-----------------------------------------------------------------
Class A 0.45% 0.25% 0.40% 1.10%
-----------------------------------------------------------------
Class B 0.45 1.00 0.40 1.85
-----------------------------------------------------------------
Class C 0.45 1.00 0.40 1.85
-----------------------------------------------------------------
</TABLE>
(1) Due to the 12b-1 distribution fee imposed on Class B and Class
C shares, a Class B or Class C shareholders may, depending
upon the length of time the shares are held, pay more than the
economic equivalent of the maximum front-end sales charges
permitted by relevant rules of the National Association of
Securities Dealers, Inc.
(2) Other Expenses reflects a 0.40% Administrative Fee paid by the
class, which is subject to a reduction of 0.05% on average daily
net assets attributable in the aggregate to the Fund's Class A, B
and C shares in excess of $2.5 billion.
Examples. The Examples are intended to help you compare the cost
of investing in Class A, B or C shares of the Fund with the costs
of investing in other mutual funds. The Examples assume that you
invest $10,000 in the noted class of shares for the time periods
indicated, your investment has a 5% return each year, the
reinvestment of all dividends and distributions, and the Fund's
operating expenses remain the same. Although your actual costs may
be higher or lower, the Examples show what your costs would be
based on these assumptions.
<TABLE>
<CAPTION>
Example: Assuming you do not
Example: Assuming you redeem your shares at the end of each period redeem your shares
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Share Class Year 1 Year 3 Year 5 Year 10 Year 1 Year 3 Year 5 Year 10
-----------------------------------------------------------------------------------------------------------
Class A $656 $880 $1,123 $1,816 $656 $880 $1,123 $1,816
-----------------------------------------------------------------------------------------------------------
Class B 688 882 1,201 1,876 188 582 1,001 1,876
-----------------------------------------------------------------------------------------------------------
Class C 288 582 1,001 2,169 188 582 1,001 2,169
-----------------------------------------------------------------------------------------------------------
</TABLE>
Prospectus
18
<PAGE>
PIMCO Opportunity Fund
- --------------------------------------------------------------------------------
Principal Investment Fund Focus Approximate
Investments Objective Smaller Capitalization Range
and Seeks capital capitalization Between $100
Strategies appreciation; common stocks million and $2
no consideration billion
is given to
income
Fund Category Approximate Number Dividend Frequency
Growth Stocks of Holdings At least annually
60-100
The Fund seeks to achieve its investment objective by normally
investing at least 65% of its assets in common stocks of "growth"
companies with market capitalizations of between $100 million and
$2 billion at the time of investment.
The portfolio manager selects stocks for the Fund using a
"growth" style. The portfolio manager seeks to identify companies
with well-defined "wealth creating" characteristics, including
superior earnings growth (relative to companies in the same
industry or the market as a whole), high profitability and
consistent, predictable earnings. In addition, through fundamental
research, the portfolio manager seeks to identify companies that
are gaining market share, have superior management and possess a
sustainable competitive advantage, such as superior or innovative
products, personnel and distribution systems. The Fund looks to
sell a stock when the portfolio manager believes that its
earnings, market sentiment or relative performance are
disappointing or if an alternative investment is more attractive.
The Fund may also invest in other kinds of equity securities,
including preferred stocks and convertible securities. The Fund
may invest up to 15% of its assets in foreign securities, usually
in the form of American Depository Receipts (ADRs).
In response to unfavorable market and other conditions, the Fund
may make temporary investments of some or all of its assets in
high-quality fixed income securities. This would be inconsistent
with the Fund's investment objective and principal strategies.
- --------------------------------------------------------------------------------
Principal Among the principal risks of investing in the Fund, which could
Risks adversely affect its net asset value, yield and total return, are:
.Market Risk .Liquidity Risk .Credit Risk
.Issuer Risk .Foreign Investment Risk .Management Risk
.Growth Securities Risk .Currency Risk .Focused
.Smaller Company Risk Investment Risk
Please see "Summary of Principal Risks" following the Fund
Summaries for a description of these and other risks of investing
in the Fund.
- --------------------------------------------------------------------------------
Performance The top of the next page shows summary performance information for
Information the Fund in a bar chart and an Average Annual Total Returns table.
The information provides some indication of the risks of investing
in the Fund by showing changes in its performance from year to
year and by showing how the Fund's average annual returns compare
with the returns of a broad-based securities market index and an
index of similar funds. The bar chart and the information to its
right show performance of the Fund's Class C shares, but the
returns do not reflect the impact of sales charges (loads). If
they did, the returns would be lower than those shown. Unlike the
bar chart, performance for Class A, B and C shares in the Average
Annual Total Returns table reflects the impact of sales charges.
For periods prior to the inception of Class A shares (12/17/90)
and Class B shares (4/1/99), performance information shown in the
Average Annual Total Returns table for those classes is based on
the performance of the Fund's Class C shares. The prior Class C
performance has been adjusted to reflect the actual sales charges,
distribution and/or service (12b-1) fees, administrative fees and
other expenses paid by Class A and B shares. Prior to March 6,
1999, the Fund had a different sub-adviser and would not
necessarily have achieved the performance results shown on the
next page under its current investment management arrangements.
Past performance is no guarantee of future results.
PIMCO Funds: Multi-Manager Series
19
<PAGE>
PIMCO Opportunity Fund (continued)
Calendar Year Total Returns -- Class C
Highest and Lowest
Quarter Returns
(for periods shown
in the bar chart)
--------------------
Highest (10/01/99-
12/31/99) 45.70%
--------------------
Lowest (7/1/98-
9/30/98) -25.78%
[GRAPH]
1990 -7.34%
1991 68.08%
1992 28.46%
1993 36.16%
1994 -4.74%
1995 41.43%
1996 11.54%
1997 -4.75%
1998 1.29%
1999 63.99%
Calendar Year End (through 12/31)
Average Annual Total Returns (for periods ended 12/31/99)
<TABLE>
<S> <C> <C> <C> <C>
Fund Inception
1 Year 5 Years 10 Years (2/24/84)(/3/)
----------------------------------------------------------------------------------
Class A 55.98% 19.60% 20.73% 19.37%
----------------------------------------------------------------------------------
Class B 58.95% 19.90% 20.80% 19.40%
----------------------------------------------------------------------------------
Class C 62.99% 20.09% 20.55% 18.93%
----------------------------------------------------------------------------------
Russell 2000 Index(/1/) 21.25% 16.69% 13.40% 12.49%
----------------------------------------------------------------------------------
Lipper Capital Appreciation Fund Average(/2/) 41.82% 22.88% 14.74% 14.56%
----------------------------------------------------------------------------------
</TABLE>
(1) The Russell 2000 Index is a capitalization weighted broad
based index of 2,000 small capitalization U.S. stocks. It is
not possible to invest directly in the index.
(2) The Lipper Capital Appreciation Fund Average is a total return
performance average of funds tracked by Lipper Analytical
Services, Inc. that have an investment objective of maximum
capital appreciation. It does not take into account sales
charges.
(3) The Fund began operations on 2/24/84. Index comparisons begin
on 2/29/84.
- --------------------------------------------------------------------------------
Fees and These tables describe the fees and expenses you may pay if you buy
Expenses and hold Class A, B or C shares of the Fund:
of the
Fund
Shareholder Fees (fees paid directly from your investment)
<TABLE>
<S> <C> <C>
Maximum Sales Charge (Load) Imposed Maximum Contingent Deferred Sales Charge (Load)
on Purchases (as a percentage of offering price) (as a percentage of original purchase price)
------------------------------------------------------------------------------------------------------
Class A 5.50% 1%(/1/)
------------------------------------------------------------------------------------------------------
Class B None 5%(/2/)
------------------------------------------------------------------------------------------------------
Class C None 1%(/3/)
------------------------------------------------------------------------------------------------------
</TABLE>
(1) Imposed only in certain circumstances where Class A shares are
purchased without a front-end sales charge at the time of
purchase.
(2) The maximum CDSC is imposed on shares redeemed in the first
year. For shares held longer than one year, the CDSC declines
according to the schedule set forth under "Investment
Options--Class A, B and C Shares--Contingent Deferred Sales
Charges (CDSCs)--Class B Shares."
(3) The CDSC on Class C shares is imposed only on shares redeemed
in the first year.
Annual Fund Operating Expenses (expenses that are deducted from
Fund assets)
<TABLE>
<S> <C> <C> <C> <C>
Distribution Total Annual
Advisory and/or Service Other Fund Operating
Share Class Fees (12b-1) Fees(/1/) Expenses(/2/) Expenses
-----------------------------------------------------------------
Class A 0.65% 0.25% 0.40% 1.30%
-----------------------------------------------------------------
Class B 0.65 1.00 0.40 2.05
-----------------------------------------------------------------
Class C 0.65 1.00 0.40 2.05
-----------------------------------------------------------------
</TABLE>
(1) Due to the 12b-1 distribution fee imposed on Class B and Class
C shares, a Class B or Class C shareholders may, depending
upon the length of time the shares are held, pay more than the
economic equivalent of the maximum front-end sales charges
permitted by relevant rules of the National Association of
Securities Dealers, Inc.
(2) Other Expenses reflects a 0.40% Administrative Fee paid by the
class, which is subject to a reduction of 0.05% on average daily
net assets attributable in the aggregate to the Fund's Class A, B
and C shares in excess of $2.5 billion.
Examples. The Examples are intended to help you compare the cost
of investing in Class A, B or C shares of the Fund with the costs
of investing in other mutual funds. The Examples assume that you
invest $10,000 in the noted class of shares for the time periods
indicated, your investment has a 5% return each year, the
reinvestment of all dividends and distributions, and the Fund's
operating expenses remain the same. Although your actual costs may
be higher or lower, the Examples show what your costs would be
based on these assumptions.
<TABLE>
<CAPTION>
Example: Assuming you do not
Example: Assuming you redeem your shares at the end of each period redeem your shares
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Share Class Year 1 Year 3 Year 5 Year 10 Year 1 Year 3 Year 5 Year 10
-----------------------------------------------------------------------------------------------------------
Class A $675 $939 $1,224 $2,032 $675 $939 $1,224 $2,032
-----------------------------------------------------------------------------------------------------------
Class B 708 943 1,303 2,091 208 643 1,103 2,091
-----------------------------------------------------------------------------------------------------------
Class C 308 643 1,103 2,379 208 643 1,103 2,379
-----------------------------------------------------------------------------------------------------------
</TABLE>
Prospectus
20
<PAGE>
PIMCO Renaissance Fund
- --------------------------------------------------------------------------------
Principal Investment Fund Focus Approximate
Investments Objective Undervalued Capitalization Range
and Seeks long-term stocks with All capitalizations
Strategies growth of capital improving
and income business
fundamentals
Dividend Frequency
Fund Category Approximate Number Quarterly
Value Stocks of Holdings
50-80
The Fund seeks to achieve its investment objective by normally
investing at least 65% of its assets in common stocks of companies
with below-average valuations whose business fundamentals are
expected to improve. Although the Fund typically invests in
companies with market capitalizations of $1 billion to $10 billion
at the time of investment, it may invest in companies in any
capitalization range. To achieve income, the Fund invests a
portion of its assets in income-producing (e.g., dividend-paying)
stocks.
The portfolio manager selects stocks for the Fund using a "value"
style. The portfolio manager invests primarily in common stocks of
companies having below-average valuations whose business
fundamentals, such as market share, strength of management and
competitive position, are expected to improve. The portfolio
manager determines valuation based on characteristics such as
price-to-earnings, price-to-book, and price-to-cash flow ratios.
The portfolio manager analyzes stocks and seeks to identify the
key drivers of financial results and catalysts for change, such as
new management and new or improved products, that indicate a
company may demonstrate improving fundamentals in the future. The
portfolio manager looks to sell a stock when he believes that the
company's business fundamentals are weakening or when the stock's
valuation has become excessive.
The Fund may also invest in other kinds of equity securities,
including preferred stocks and convertible securities. The Fund
may invest up to 15% of its assets in foreign securities, usually
in the form of American Depository Receipts (ADRs).
In response to unfavorable market and other conditions, the Fund
may make temporary investments of some or all of its assets in
high-quality fixed income securities. This would be inconsistent
with the Fund's investment objective and principal strategies.
- --------------------------------------------------------------------------------
Principal Among the principal risks of investing in the Fund, which could
Risks adversely affect its net asset value, yield and total return, are:
.Market Risk .Foreign Investment Risk .Credit Risk
.Issuer Risk .Currency Risk .Management Risk
.Value Securities Risk
Please see "Summary of Principal Risks" following the Fund
Summaries for a description of these and other risks of investing
in the Fund.
- --------------------------------------------------------------------------------
Performance The top of the next page shows summary performance information for
Information the Fund in a bar chart and an Average Annual Total Returns table.
The information provides some indication of the risks of investing
in the Fund by showing changes in its performance from year to
year and by showing how the Fund's average annual returns compare
with the returns of a broad-based securities market index and an
index of similar funds. The bar chart and the information to its
right show performance of the Fund's Class C shares, but the
returns do not reflect the impact of sales charges (loads). If
they did, the returns would be lower than those shown. Unlike the
bar chart, performance for Class A, B and C shares in the Average
Annual Total Returns table reflects the impact of sales charges.
For periods prior to the inception of Class A shares (2/1/91) and
Class B shares (5/22/95), performance information shown in the
Average Annual Total Returns table for those classes is based on
the performance of the Fund's Class C shares. The prior Class C
performance has been adjusted to reflect the actual sales charges,
distribution and/or service (12b-1) fees, administrative fees and
other expenses paid by Class A and B shares. Prior to May 7, 1999,
the Fund had a different sub-adviser and would not necessarily
have achieved the performance results shown on the next page under
its current investment management arrangements. Past performance
is no guarantee of future results.
PIMCO Funds: Multi-Manager Series
21
<PAGE>
PIMCO Renaissance Fund (continued)
Calendar Year Total Returns -- Class C
Highest and Lowest
Quarter Returns
(for periods shown
in the bar chart)
--------------------
Highest (10/1/98-
12/31/98) 18.37%
--------------------
Lowest (7/1/98-
9/30/98) -16.77%
[GRAPH]
1990 -15.46%
1991 33.24%
1992 7.78%
1993 21.23%
1994 -5.05%
1995 27.61%
1996 24.40%
1997 34.90%
1998 10.72%
1999 9.02%
Calendar Year End (through 12/31)
Average Annual Total Returns (for periods ended 12/31/99)
<TABLE>
<S> <C> <C> <C> <C>
Fund Inception
1 Year 5 Years 10 Years (4/18/88)(/3/)
------------------------------------------------------------------
Class A 3.79% 20.45% 13.92% 13.45%
------------------------------------------------------------------
Class B 4.66% 20.70% 13.97% 13.49%
------------------------------------------------------------------
Class C 8.16% 20.92% 13.70% 13.15%
------------------------------------------------------------------
Russell 1000 Value Index(/1/) 7.34% 23.08% 15.60% 16.38%
------------------------------------------------------------------
Lipper Equity Income Fund
Average(/2/) 4.77% 18.02% 12.85% 13.54%
------------------------------------------------------------------
</TABLE>
(1) The Russell 1000 Value Index is an unmanaged index that
measures the performance of companies in the Russell 1000
Index with lower price-to-book ratios and lower forecasted
growth values. It is not possible to invest directly in the
index. The Russell 1000 Value Index replaced the S&P 500 Index
(an unmanaged index of large capitalization common stocks) as
the Fund's comparative index because PIMCO Advisors believes
the Russell 1000 Value Index is more representative of the
Fund's investment strategies. For periods ended December 31,
1999, the 1 Year, 5 Years, 10 Years and Fund Inception average
annual total returns of the S&P 500 Index were 21.04%, 28.56%,
18.21% and 19.06%, respectively.
(2) The Lipper Equity Income Fund Average is a total return
performance average of funds tracked by Lipper Analytical
Services, Inc. that seek relatively higher growth of income
through investing 60% or more of their portfolios in equities.
It does not take into account sales charges.
(3) The Fund began operations on 4/18/88. Index comparisons begin
on 4/30/88.
- --------------------------------------------------------------------------------
Fees and These tables describe the fees and expenses you may pay if you buy
Expenses and hold Class A, B or C shares of the Fund:
of the
Fund
Shareholder Fees (fees paid directly from your investment)
<TABLE>
<S> <C> <C>
Maximum Sales Charge (Load) Imposed Maximum Contingent Deferred Sales Charge (Load)
on Purchases (as a percentage of offering price) (as a percentage of original purchase price)
------------------------------------------------------------------------------------------------------
Class A 5.50% 1%(/1/)
------------------------------------------------------------------------------------------------------
Class B None 5%(/2/)
------------------------------------------------------------------------------------------------------
Class C None 1%(/3/)
------------------------------------------------------------------------------------------------------
</TABLE>
(1) Imposed only in certain circumstances where Class A shares are
purchased without a front-end sales charge at the time of
purchase.
(2) The maximum CDSC is imposed on shares redeemed in the first
year. For shares held longer than one year, the CDSC declines
according to the schedule set forth under "Investment
Options--Class A, B and C Shares--Contingent Deferred Sales
Charges (CDSCs)--Class B Shares."
(3) The CDSC on Class C shares is imposed only on shares redeemed
in the first year.
Annual Fund Operating Expenses (expenses that are deducted from
Fund assets)
<TABLE>
<S> <C> <C> <C> <C>
Distribution Total Annual
Advisory and/or Service Other Fund Operating
Share Class Fees (12b-1) Fees(/1/) Expenses(/2/) Expenses
-----------------------------------------------------------------
Class A 0.60% 0.25% 0.40% 1.25%
-----------------------------------------------------------------
Class B 0.60 1.00 0.40 2.00
-----------------------------------------------------------------
Class C 0.60 1.00 0.40 2.00
-----------------------------------------------------------------
</TABLE>
(1) Due to the 12b-1 distribution fee imposed on Class B and Class
C shares, a Class B or Class C shareholders may, depending
upon the length of time the shares are held, pay more than the
economic equivalent of the maximum front-end sales charges
permitted by relevant rules of the National Association of
Securities Dealers, Inc.
(2) Other Expenses reflects a 0.40% Administrative Fee paid by the
class, which is subject to a reduction of 0.05% on average daily
net assets attributable in the aggregate to the Fund's Class A, B
and C shares in excess of $2.5 billion.
Examples. The Examples are intended to help you compare the cost
of investing in Class A, B or C shares of the Fund with the costs
of investing in other mutual funds. The Examples assume that you
invest $10,000 in the noted class of shares for the time periods
indicated, your investment has a 5% return each year, the
reinvestment of all dividends and distributions, and the Fund's
operating expenses remain the same. Although your actual costs may
be higher or lower, the Examples show what your costs would be
based on these assumptions.
<TABLE>
<CAPTION>
Example: Assuming you do not
Example: Assuming you redeem your shares at the end of each period redeem your shares
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Share Class Year 1 Year 3 Year 5 Year 10 Year 1 Year 3 Year 5 Year 10
-----------------------------------------------------------------------------------------------------------
Class A $670 $925 $1,199 $1,978 $670 $925 $1,199 $1,978
-----------------------------------------------------------------------------------------------------------
Class B 703 927 1,278 2,038 203 627 1,078 2,038
-----------------------------------------------------------------------------------------------------------
Class C 303 627 1,078 2,327 203 627 1,078 2,327
-----------------------------------------------------------------------------------------------------------
</TABLE>
Prospectus
22
<PAGE>
PIMCO Select Growth Fund
- --------------------------------------------------------------------------------
Principal Investment Fund Focus Approximate
Investments Objective Larger Capitalization Range
and Seeks long-term capitalization At least $10 billion
Strategies growth of common stocks
capital; income
is an incidental
consideration
Approximate Number Dividend Frequency
Fund Category of Holdings At least annually
Growth Stocks 15-25
The Fund seeks to achieve its investment objective by normally
investing at least 65% of its assets in common stocks of "growth"
companies with market capitalizations of at least $10 billion at
the time of investment. The Fund normally invests in the
securities of 15 to 25 issuers.
The portfolio manager selects stocks for the Fund using a
"growth" style. The portfolio manager seeks to identify companies
with well-defined "wealth creating" characteristics, including
superior earnings growth (relative to companies in the same
industry or the market as a whole), high profitability and
consistent, predictable earnings. In addition, through fundamental
research, the portfolio manager seeks to identify companies that
are gaining market share, have superior management and possess a
sustainable competitive advantage, such as superior or innovative
products, personnel and distribution systems. The Fund looks to
sell a stock when the portfolio manager believes that its
earnings, market sentiment or relative performance are
disappointing or if an alternative investment is more attractive.
The Fund is "non-diversified," which means that it invests in a
relatively small number of issuers.
The Fund may invest up to 25% of its assets in foreign
securities, usually in the form of American Depository Receipts
(ADRs). In response to unfavorable market and other conditions,
the Fund may make temporary investments of some or all of its
assets in high-quality fixed income securities. This would be
inconsistent with the Fund's investment objective and principal
strategies.
- --------------------------------------------------------------------------------
Principal Among the principal risks of investing in the Fund, which could
Risks adversely affect its net asset value, yield and total return, are:
.Market Risk .Growth Securities Risk .Credit Risk
.Issuer Risk .Foreign Investment Risk .Management Risk
.Focused Investment Risk .Currency Risk
Please see "Summary of Principal Risks" following the Fund
Summaries for a description of these and other risks of investing
in the Fund.
- --------------------------------------------------------------------------------
Performance The top of the next page shows summary performance information for
Information the Fund in a bar chart and an Average Annual Total Returns table.
The information provides some indication of the risks of investing
in the Fund by showing changes in its performance from year to
year and by showing how the Fund's average annual returns compare
with the returns of a broad-based securities market index and an
index of similar funds. The bar chart and the information to its
right show performance of the Fund's Institutional Class shares,
which are offered in a different prospectus. This is because the
Fund did not offer Class A, B or C shares during the periods
shown. Although Institutional Class and Class A, B and C shares
would have similar annual returns (because all the Fund's shares
represent interests in the same portfolio of securities),
Institutional Class performance would be higher than Class A, B or
C performance because of the lower expenses and no sales charges
paid by Institutional Class shares. The Average Annual Total
Returns table also shows estimated historical performance for
Class A, B and C shares based on the performance of the Fund's
Institutional Class shares, adjusted to reflect the actual sales
charges (loads), distribution and/or service (12b-1) fees,
administrative fees and other expenses paid by Class A, B and C
shares. The performance information on the next page reflects the
Fund's advisory fee level in effect prior to April 1, 2000 (0.57%
per annum); these results would have been lower had the Fund's
current advisory fee level (0.60% per annum) then been in effect.
Prior to July 1, 1999, the Fund had a different sub-adviser and
would not necessarily have achieved the performance results shown
on the next page under its current investment management
arrangements. In addition, the Fund changed its investment
objective and policies on April 1, 2000; the performance results
shown on the next page would not necessarily have been achieved
had the Fund's current objective and policies then been in effect.
Past performance is no guarantee of future results.
PIMCO Funds: Multi-Manager Series
23
<PAGE>
PIMCO Select Growth Fund (continued)
Calendar Year Total Returns -- Institutional Class
Highest and Lowest
Quarter Returns
(for periods shown
in the bar chart)
--------------------
Highest (10/01/98-
12/31/98)_____24.90%
--------------------
Lowest (7/1/98-
9/30/98)_____-11.38%
[GRAPH]
1995 27.96%
1996 17.95%
1997 25.32%
1998 41.06%
1999 24.27%
Calendar Year End (through 12/31)
Average Annual Total Returns (for periods ended 12/31/99)
<TABLE>
<S> <C> <C> <C>
Fund Inception
1 Year 5 Years (12/28/94)(/3/)
-----------------------------------------------------------------
Institutional Class 24.27% 27.09% 27.06%
-----------------------------------------------------------------
Class A 16.97% 25.17% 25.14%
-----------------------------------------------------------------
Class B 17.86% 25.50% 25.55%
-----------------------------------------------------------------
Class C 21.86% 25.66% 25.63%
-----------------------------------------------------------------
S&P 500 Index(/1/) 21.04% 28.56% 28.56%
-----------------------------------------------------------------
Lipper Growth Fund Average(/2/) 29.23% 25.03% 25.03%
-----------------------------------------------------------------
</TABLE>
(1) The S&P 500 Index is an unmanaged index of large
capitalization common stocks. It is not possible to invest
directly in the index.
(2) The Lipper Growth Fund Average is a total return performance
average of funds tracked by Lipper Analytical Services, Inc.
that invest in companies with long-term earnings expected to
grow significantly faster than the earnings of the stocks
represented in the major unmanaged stock indexes. It does not
take into account sales charges.
(3) The Fund began operations on 12/28/94. Index comparisons begin
on 12/31/94.
- --------------------------------------------------------------------------------
Fees and These tables describe the fees and expenses you may pay if you buy
Expenses and hold Class A, B or C shares of the Fund:
of the
Fund
Shareholder Fees (fees paid directly from your investment)
<TABLE>
<S> <C> <C>
Maximum Sales Charge (Load) Imposed Maximum Contingent Deferred Sales Charge (Load)
on Purchases (as a percentage of offering price) (as a percentage of original purchase price)
------------------------------------------------------------------------------------------------------
Class A 5.50% 1%(/1/)
------------------------------------------------------------------------------------------------------
Class B None 5%(/2/)
------------------------------------------------------------------------------------------------------
Class C None 1%(/3/)
------------------------------------------------------------------------------------------------------
</TABLE>
(1) Imposed only in certain circumstances where Class A shares are
purchased without a front-end sales charge at the time of
purchase.
(2) The maximum CDSC is imposed on shares redeemed in the first
year. For shares held longer than one year, the CDSC declines
according to the schedule set forth under "Investment
Options--Class A, B and C Shares--Contingent Deferred Sales
Charges (CDSCs)--Class B Shares."
(3) The CDSC on Class C shares is imposed only on shares redeemed
in the first year.
Annual Fund Operating Expenses (expenses that are deducted from
Fund assets)
<TABLE>
<S> <C> <C> <C> <C>
Distribution Total Annual
Advisory and/or Service Other Fund Operating
Share Class Fees (12b-1) Fees(/1/) Expenses(/2/) Expenses
-----------------------------------------------------------------
Class A 0.60% 0.25% 0.40% 1.25%
-----------------------------------------------------------------
Class B 0.60 1.00 0.40 2.00
-----------------------------------------------------------------
Class C 0.60 1.00 0.40 2.00
-----------------------------------------------------------------
</TABLE>
(1) Due to the 12b-1 distribution fee imposed on Class B and Class
C shares, a Class B or Class C shareholders may, depending
upon the length of time the shares are held, pay more than the
economic equivalent of the maximum front-end sales charges
permitted by relevant rules of the National Association of
Securities Dealers, Inc.
(2) Other Expenses reflects a 0.40% Administrative Fee paid by the
class, which is subject to a reduction of 0.05% on average daily
net assets attributable in the aggregate to the Fund's Class A, B
and C shares in excess of $2.5 billion.
Examples. The Examples are intended to help you compare the cost
of investing in Class A, B or C shares of the Fund with the costs
of investing in other mutual funds. The Examples assume that you
invest $10,000 in the noted class of shares for the time periods
indicated, your investment has a 5% return each year, the
reinvestment of all dividends and distributions, and the Fund's
operating expenses remain the same. Although your actual costs may
be higher or lower, the Examples show what your costs would be
based on these assumptions.
<TABLE>
<CAPTION>
Example: Assuming you do not
Example: Assuming you redeem your shares at the end of each period redeem your shares
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Share Class Year 1 Year 3 Year 5 Year 10 Year 1 Year 3 Year 5 Year 10
-----------------------------------------------------------------------------------------------------------
Class A $670 $925 $1,199 $1,978 $670 $925 $1,199 $1,978
-----------------------------------------------------------------------------------------------------------
Class B 703 927 1,278 2,038 203 627 1,078 2,038
-----------------------------------------------------------------------------------------------------------
Class C 303 627 1,078 2,327 203 627 1,078 2,327
-----------------------------------------------------------------------------------------------------------
</TABLE>
Prospectus
24
<PAGE>
PIMCO Small-Cap Value Fund
- --------------------------------------------------------------------------------
Principal Investment Fund Focus Approximate
Investments Objective Undervalued Capitalization Range
and Seeks long-term smaller Between $50
Strategies growth of capitalization million and$1.5
capital and common stocks billion
income
Fund Category Approximate Dividend Frequency
Value Stocks Number of At least
Holdings annually
100
The Fund seeks to achieve its investment objective by normally
investing at least 65% of its assets in common stocks of companies
with market capitalizations of between $100 million and $1.5
billion at the time of investment and below average P/E ratios
relative to the market and their respective industry groups. To
achieve income, the Fund invests a portion of its assets in
income-producing (or dividend-paying) common stocks.
The Fund's initial selection universe consists of approximately
4,500 stocks of companies within the Fund's capitalization range.
The portfolio managers screen this universe to identify
approximately 500 undervalued stocks representing approximately
160 industry groups. This screening process is based on a number
of valuation factors, including P/E ratios (calculated both with
respect to trailing operating earnings and forward earnings
estimates) and price-to-sales, price-to-book value, and price-to-
cash flow ratios. These factors are considered both on a relative
basis (compared to other stocks in the same industry group) and on
an absolute basis (compared to the overall market).
From this narrowed universe, the portfolio managers select
approximately 100 stocks for the Fund, each of which has close to
equal weighting in the portfolio. They select stocks based on a
quantitative analysis of factors including price momentum (based
on changes in stock price relative to changes in overall market
prices), earnings momentum (based on analysts' earnings per share
estimates and revisions to those estimates), relative dividend
yields and trading liquidity. The portfolio is also structured to
have a maximum weighting of no more than 10% in any one industry.
The portfolio managers may replace a stock if its market
capitalization becomes excessive, if its valuation exceeds the
average valuation of stocks represented in the S&P 500 Index, or
when a stock within the same industry group has a considerably
lower valuation than the Fund's current holding.
Under normal circumstances, the Fund intends to be fully invested
in common stocks (aside from certain cash management practices).
The Fund may temporarily hold up to 10% of its assets in cash and
cash equivalents for defensive purposes in response to unfavorable
market and other conditions. This would be inconsistent with the
Fund's investment objective and principal strategies.
- --------------------------------------------------------------------------------
Principal Among the principal risks of investing in the Fund, which could
Risks adversely affect its net asset value, yield and total return, are:
.Market Risk .Smaller Company Risk .Credit Risk
.Issuer Risk .Liquidity Risk .Management Risk
.Value Securities Risk .Focused Investment Risk
Please see "Summary of Principal Risks" following the Fund
Summaries for a description of these and other risks of investing
in the Fund.
- --------------------------------------------------------------------------------
Performance The top of the next page shows summary performance information for
Information the Fund in a bar chart and an Average Annual Total Returns table.
The information provides some indication of the risks of investing
in the Fund by showing changes in its performance from year to
year and by showing how the Fund's average annual returns compare
with the returns of a broad-based securities market index and an
index of similar funds. The bar chart and the information to its
right show performance of the Fund's Class A shares, but the
returns do not reflect the impact of sales charges (loads). If
they did, the returns would be lower than those shown. Unlike the
bar chart, performance for Class A, B and C shares in the Average
Annual Total Returns table reflects the impact of sales charges.
For periods prior to the inception of Class A, B and C shares
(1/20/97), performance information shown in the bar chart and
tables for those classes is based on the performance of the Fund's
Institutional Class shares, which are offered in a different
prospectus. The prior Institutional Class performance has been
adjusted to reflect the actual sales charges (in the Average
Annual Total Returns table only), distribution and/or service
(12b-1) fees, administrative fees and other expenses paid by Class
A, B and C shares. Past performance is no guarantee of future
results.
PIMCO Funds: Multi-Manager Series
25
<PAGE>
PIMCO Small-Cap Value Fund (continued)
Calendar Year Total Returns -- Class A
Highest and Lowest
Quarter Returns
(for periods shown
in the bar chart)
-------------------
Highest (4/1/99-
6/30/99) 16.28%
-------------------
Lowest (7/1/98-
9/30/98) -18.71%
[GRAPH]
1992 18.27%
1993 13.39%
1994 -4.07%
1995 24.98%
1996 27.22%
1997 34.47%
1998 -9.48%
1999 -6.82%
Calendar Year End (through 12/31)
Average Annual Total Returns (for periods ended 12/31/99)
<TABLE>
<S> <C> <C> <C>
Fund Inception
1 Year 5 Years (9/30/91)(/3/)
---------------------------------------------------------------
Class A -11.95% 11.25% 10.77%
---------------------------------------------------------------
Class B -12.08% 11.42% 10.83%
---------------------------------------------------------------
Class C - 8.39% 11.69% 10.71%
---------------------------------------------------------------
Russell 2000 Index(/1/) 21.25% 16.69% 14.97%
---------------------------------------------------------------
Lipper Small-Cap Fund Average(/2/) 33.65% 19.63% 17.20%
---------------------------------------------------------------
</TABLE>
(1) The Russell 2000 Index is a capitalization weighted broad
based index of 2,000 small capitalization U.S. stock. It is
not possible to invest directly in the index.
(2) The Lipper Small-Cap Fund Average is a total return
performance average of funds tracked by Lipper Analytical
Services, Inc. that invest primarily in companies with market
capitalizations of less than $1 billion at the time of
investment. It does not take into account sales charges.
(3) The Fund began operations on 9/30/91. Index comparisons begin
on 10/1/91.
- --------------------------------------------------------------------------------
Fees and These tables describe the fees and expenses you may pay if you buy
Expenses and hold Class A, B or C shares of the Fund:
of the
Fund
Shareholder Fees (fees paid directly from your investment)
<TABLE>
<S> <C> <C>
Maximum Sales Charge (Load) Imposed Maximum Contingent Deferred Sales Charge (Load)
on Purchases (as a percentage of offering price) (as a percentage of original purchase price)
------------------------------------------------------------------------------------------------------
Class A 5.50% 1%(/1/)
------------------------------------------------------------------------------------------------------
Class B None 5%(/2/)
------------------------------------------------------------------------------------------------------
Class C None 1%(/3/)
------------------------------------------------------------------------------------------------------
</TABLE>
(1) Imposed only in certain circumstances where Class A shares are
purchased without a front-end sales charge at the time of
purchase.
(2) The maximum CDSC is imposed on shares redeemed in the first
year. For shares held longer than one year, the CDSC declines
according to the schedule set forth under "Investment
Options--Class A, B and C Shares--Contingent Deferred Sales
Charges (CDSCs)--Class B Shares."
(3) The CDSC on Class C shares is imposed only on shares redeemed
in the first year.
Annual Fund Operating Expenses (expenses that are deducted from
Fund assets)
<TABLE>
<S> <C> <C> <C> <C>
Distribution Total Annual
Advisory and/or Service Other Fund Operating
Share Class Fees (12b-1) Fees(/1/) Expenses(/2/) Expenses
-----------------------------------------------------------------
Class A 0.60% 0.25% 0.40% 1.25%
-----------------------------------------------------------------
Class B 0.60 1.00 0.40 2.00
-----------------------------------------------------------------
Class C 0.60 1.00 0.40 2.00
-----------------------------------------------------------------
</TABLE>
(1) Due to the 12b-1 distribution fee imposed on Class B and Class
C shares, a Class B or Class C shareholders may, depending
upon the length of time the shares are held, pay more than the
economic equivalent of the maximum front-end sales charges
permitted by relevant rules of the National Association of
Securities Dealers, Inc.
(2) Other Expenses reflects a 0.40% Administrative Fee paid by the
class, which is subject to a reduction of 0.05% on average daily
net assets attributable in the aggregate to the Fund's Class A, B
and C shares in excess of $2.5 billion.
Examples. The Examples are intended to help you compare the cost
of investing in Class A, B or C shares of the Fund with the costs
of investing in other mutual funds. The Examples assume that you
invest $10,000 in the noted class of shares for the time periods
indicated, your investment has a 5% return each year, the
reinvestment of all dividends and distributions, and the Fund's
operating expenses remain the same. Although your actual costs may
be higher or lower, the Examples show what your costs would be
based on these assumptions.
<TABLE>
<CAPTION>
Example: Assuming you do not
Example: Assuming you redeem your shares at the end of each period redeem your shares
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Share Class Year 1 Year 3 Year 5 Year 10 Year 1 Year 3 Year 5 Year 10
-----------------------------------------------------------------------------------------------------------
Class A $670 $925 $1,199 $1,978 $670 $925 $1,199 $1,978
-----------------------------------------------------------------------------------------------------------
Class B 703 927 1,278 2,038 203 627 1,078 2,038
-----------------------------------------------------------------------------------------------------------
Class C 303 627 1,078 2,327 203 627 1,078 2,327
-----------------------------------------------------------------------------------------------------------
</TABLE>
Prospectus
26
<PAGE>
PIMCO Target Fund
- --------------------------------------------------------------------------------
Principal Investment Fund Focus Approximate
Investments Objective Medium Capitalization Range
and Seeks capital capitalization Between $1
Strategies appreciation; no common stocks billion and $10
consideration is billion
given to income
Approximate Number Dividend Frequency
Fund Category of Holdings At least annually
Growth Stocks 40-60
The Fund seeks to achieve its investment objective by normally
investing at least 65% of its assets in common stocks of "growth"
companies with market capitalizations of between $1 billion and
$10 billion at the time of investment.
The portfolio managers select stocks for the Fund using a
"growth" style. The portfolio managers seek to identify companies
with well-defined "wealth creating" characteristics, including
superior earnings growth (relative to companies in the same
industry or the market as a whole), high profitability and
consistent, predictable earnings. In addition, through fundamental
research, the portfolio managers seek to identify companies that
are gaining market share, have superior management and possess a
sustainable competitive advantage, such as superior or innovative
products, personnel and distribution systems. The Fund looks to
sell a stock when the portfolio managers believe that its
earnings, market sentiment or relative performance are
disappointing or if an alternative investment is more attractive.
The Fund may also invest in other kinds of equity securities,
including preferred stocks and convertible securities. The Fund
may invest up to 15% of its assets in foreign securities, usually
in the form of American Depository Receipts (ADRs).
In response to unfavorable market and other conditions, the Fund
may make temporary investments of some or all of its assets in
high-quality fixed income securities. This would be inconsistent
with the Fund's investment objective and principal strategies.
- --------------------------------------------------------------------------------
Principal Among the principal risks of investing in the Fund, which could
Risks adversely affect its net asset value, yield and total return, are:
.Market Risk .Smaller Company Risk .Currency Risk
.Issuer Risk .Liquidity Risk .Credit Risk
.Growth Securities Risk .Foreign Investment Risk .Management Risk
.Focused Investment Risk
Please see "Summary of Principal Risks" following the Fund
Summaries for a description of these and other risks of investing
in the Fund.
- --------------------------------------------------------------------------------
Performance The top of the next page shows summary performance information for
Information the Fund in a bar chart and an Average Annual Total Returns table.
The information provides some indication of the risks of investing
in the Fund by showing changes in its performance from year to
year and by showing how the Fund's average annual returns compare
with the returns of a broad-based securities market index and an
index of similar funds. The bar chart and the information to its
right show performance of the Fund's Class A shares, but the
returns do not reflect the impact of sales charges (loads). If
they did, the returns would be lower than those shown. Unlike the
bar chart, performance for Class A, B and C shares in the Average
Annual Total Returns table reflects the impact of sales charges.
For periods prior to the inception of Class B shares (5/22/95),
performance information shown in the Average Annual Total Returns
table for that class is based on the performance of the Fund's
Class A shares. The prior Class A performance has been adjusted to
reflect the actual sales charges, distribution and/or service
(12b-1) fees, administrative fees and other expenses paid by Class
B shares. Prior to March 6, 1999, the Fund had a different sub-
adviser and would not necessarily have achieved the performance
results shown on the next page under its current investment
management arrangements. Past performance is no guarantee of
future results.
PIMCO Funds: Multi-Manager Series
27
<PAGE>
PIMCO Target Fund (continued)
Calendar Year Total Returns -- Class A
Highest and Lowest
Quarter Returns
(for periods shown
in the bar chart)
--------------------
Highest (10/1/99-
12/31/99) 53.05%
--------------------
Lowest (7/1/98-
9/30/98) -13.15%
[GRAPH]
1993 24.52%
1994 3.09%
1995 30.31%
1996 15.68%
1997 15.44%
1998 23.27%
1999 66.25%
Calendar Year End (through 12/31)
Average Annual Total Returns (for periods ended 12/31/99)
<TABLE>
<S> <C> <C> <C>
Fund Inception
1 Year 5 Years (12/17/92)(/3/)
------------------------------------------------------------------
Class A 57.10% 28.28% 24.13%
------------------------------------------------------------------
Class B 60.05% 28.62% 24.19%
------------------------------------------------------------------
Class C 64.05% 28.77% 24.19%
------------------------------------------------------------------
S&P Mid-Cap 400 Index(/1/) 14.73% 23.05% 17.55%
------------------------------------------------------------------
Lipper Mid-Cap Fund Average(/2/) 39.38% 23.07% 17.44%
------------------------------------------------------------------
</TABLE>
(1) The S&P Mid-Cap 400 Index is an unmanaged index of middle
capitalization U.S. stocks. It is not possible to invest directly
in the index.
(2) The Lipper Mid-Cap Fund Average is a total return performance
average of funds tracked by Lipper Analytical Services, Inc. that
invest primarily in companies with market capitalizations of less
than $5 billion at the time of investment. It does not take into
account sales charges.
(3) The Fund began operations on 12/17/92. Index comparisons begin
on 12/31/92.
- --------------------------------------------------------------------------------
Fees and These tables describe the fees and expenses you may pay if you buy
Expenses and hold Class A, B or C shares of the Fund:
of the
Fund
Shareholder Fees (fees paid directly from your investment)
<TABLE>
<S> <C> <C>
Maximum Sales Charge (Load) Imposed Maximum Contingent Deferred Sales Charge (Load)
on Purchases (as a percentage of offering price) (as a percentage of original purchase price)
------------------------------------------------------------------------------------------------------
Class A 5.50% 1%(/1/)
------------------------------------------------------------------------------------------------------
Class B None 5%(/2/)
------------------------------------------------------------------------------------------------------
Class C None 1%(/3/)
------------------------------------------------------------------------------------------------------
</TABLE>
(1) Imposed only in certain circumstances where Class A shares are
purchased without a front-end sales charge at the time of
purchase.
(2) The maximum CDSC is imposed on shares redeemed in the first
year. For shares held longer than one year, the CDSC declines
according to the schedule set forth under "Investment
Options--Class A, B and C Shares--Contingent Deferred Sales
Charges (CDSCs)--Class B Shares."
(3) The CDSC on Class C shares is imposed only on shares redeemed
in the first year.
Annual Fund Operating Expenses (expenses that are deducted from
Fund assets)
<TABLE>
<S> <C> <C> <C> <C>
Distribution Total Annual
Advisory and/or Service Other Fund Operating
Share Class Fees (12b-1) Fees(/1/) Expenses(/2/) Expenses
-----------------------------------------------------------------
Class A 0.55% 0.25% 0.40% 1.20%
-----------------------------------------------------------------
Class B 0.55 1.00 0.40 1.95
-----------------------------------------------------------------
Class C 0.55 1.00 0.40 1.95
-----------------------------------------------------------------
</TABLE>
(1) Due to the 12b-1 distribution fee imposed on Class B and Class
C shares, a Class B or Class C shareholders may, depending
upon the length of time the shares are held, pay more than the
economic equivalent of the maximum front-end sales charges
permitted by relevant rules of the National Association of
Securities Dealers, Inc.
(2) Other Expenses reflects a 0.40% Administrative Fee paid by the
class, which is subject to a reduction of 0.05% on average
daily net assets attributable in the aggregate to the Fund's
Class A, B and C shares in excess of $2.5 billion.
Examples. The Examples are intended to help you compare the cost
of investing in Class A, B or C shares of the Fund with the costs
of investing in other mutual funds. The Examples assume that you
invest $10,000 in the noted class of shares for the time periods
indicated, your investment has a 5% return each year, the
reinvestment of all dividends and distributions, and the Fund's
operating expenses remain the same. Although your actual costs may
be higher or lower, the Examples show what your costs would be
based on these assumptions.
<TABLE>
<CAPTION>
Example: Assuming you do not
Example: Assuming you redeem your shares at the end of each period redeem your shares
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Share Class Year 1 Year 3 Year 5 Year 10 Year 1 Year 3 Year 5 Year 10
-----------------------------------------------------------------------------------------------------------
Class A $666 $910 $1,173 $1,925 $666 $910 $1,173 $1,925
-----------------------------------------------------------------------------------------------------------
Class B 698 912 1,252 1,984 198 612 1,052 1,984
-----------------------------------------------------------------------------------------------------------
Class C 298 612 1,052 2,275 198 612 1,052 2,275
-----------------------------------------------------------------------------------------------------------
</TABLE>
Prospectus
28
<PAGE>
PIMCO Tax-Efficient Equity Fund
- --------------------------------------------------------------------------------
Principal Investment Fund Focus Approximate
Investments Objective A portion of the Capitalization Range
and Seeks maximum common stocks More than $5
Strategies after-tax growth represented in billion
of capital the S&P 500 Index
Dividend Frequency
Fund Category Approximate Number At least
Enhanced Index of Holdings annually
More than 200
The Fund attempts to provide a total return which exceeds the
return of the S&P 500 Index by investing in a broadly diversified
portfolio of at least 200 common stocks. The Fund also attempts to
achieve superior after-tax returns for its shareholders by using a
variety of tax-efficient management strategies.
The Fund seeks to achieve its investment objective by normally
investing at least 95% of its assets in stocks represented in the
S&P 500 Index. The Fund's portfolio is designed to have certain
characteristics that are similar to those of the index, including
such measures as dividend yield, P/E ratio, relative volatility,
economic sector exposure, return on equity and market price-to-
book value ratio. The Fund's return is intended to correlate
highly with the return of the S&P 500 Index, but the portfolio
managers attempt to produce a higher total return than the index
by selecting a portion of the stocks represented in the index
using the quantitative techniques described below. The portfolio
managers also use these techniques to make sell decisions.
Notwithstanding these strategies, there is no assurance that the
Fund's investment performance will equal or exceed that of the S&P
500 Index.
The Fund intends to be fully invested in common stock (aside from
certain cash management practices) and will not make defensive
investments in response to unfavorable market and other
conditions.
Quantitative Techniques. The portfolio managers use a proprietary
quantitative model that ranks companies based on long-term (5-10
years) price appreciation potential. They analyze factors such as
growth of sustainable earnings and dividend behavior. Stocks in
the top 50% of the model's ranking are considered for purchase by
the Fund. The Fund looks to sell stocks selected from the bottom
20% of the model's ranking based on cost, current market value and
anticipated benefit of replacement. The portfolio managers' sell
discipline also focuses on reducing realized capital gains as
indicated below.
Tax-Efficient Strategies. The portfolio managers utilize a range
of active tax management strategies designed to minimize the
Fund's taxable distributions, including low portfolio turnover and
favoring investments in low-dividend, growth-oriented companies.
The portfolio managers also identify specific shares of stock to
be sold that have the lowest tax cost. When prudent, stocks are
also sold to realize capital losses in order to offset realized
capital gains. In limited circumstances, the Fund may also
distribute appreciated securities to shareholders to meet
redemption requests so as to avoid realizing capital gains.
Despite the use of these tax-efficient strategies, the Fund may
realize gains and shareholders will incur tax liability from time
to time.
- --------------------------------------------------------------------------------
Principal Among the principal risks of investing in the Fund, which could
Risks adversely affect its net asset value, yield and total return, are:
. Market Risk . Growth Securities Risk . Credit Risk
. Issuer Risk . Leveraging Risk . Management Risk
. Value Securities Risk . Focused Investment Risk
Please see "Summary of Principal Risks" following the Fund
Summaries for a description of these and other risks of investing
in the Fund.
- --------------------------------------------------------------------------------
Performance The top of the next page shows summary performance information for
Information the Fund in a bar chart and an Average Annual Total Returns table.
The information provides some indication of the risks of investing
in the Fund by showing changes in its performance from year to
year and by showing how the Fund's average annual returns compare
with the returns of a broad-based securities market index and an
index of similar funds. The bar chart and the information to its
right show performance of the Fund's Class A shares, but the
returns do not reflect the impact of sales charges (loads). If
they did, the returns would be lower than those shown. Unlike the
bar chart, performance for Class A, B and C shares in the Average
Annual Total Returns table reflects the impact of sales charges.
Past performance is no guarantee of future results.
PIMCO Funds: Multi-Manager Series
29
<PAGE>
PIMCO Tax-Efficient Equity Fund (continued)
Calendar Year Total Returns -- Class A
Highest and Lowest
Quarter Returns
(for periods shown
in the bar chart)
--------------------
Highest (10/1/98-
12/31/98_____21.73%)
--------------------
Lowest (7/1/99-
9/30/99______-7.25%)
[GRAPH]
1999 17.38%
Calendar Year End (through 12/31)
Average Annual Total Returns (for periods ended 12/31/99)
<TABLE>
<S> <C> <C>
Fund Inception
1 Year (7/10/98)(/3/)
------------------------------------------------------------------------
Class A 10.95% 11.10%
------------------------------------------------------------------------
Class B 11.49% 11.99%
------------------------------------------------------------------------
Class C 15.49% 14.54%
------------------------------------------------------------------------
S&P 500 Index(/1/) 21.04% 20.42%
------------------------------------------------------------------------
Lipper Growth Fund Average(/2/) 29.23% 23.65%
------------------------------------------------------------------------
</TABLE>
(1) The S&P 500 index is an unmanaged index of large
capitalization U.S. stocks. It is not possible to invest directly
in the index.
(2) The Lipper Growth Fund Average is a total return performance
average of funds tracked by Lipper Analytical Services, Inc. that
invest primarily in companies with long-term earnings expected to
grow significantly faster than the earnings of the stocks
represented in the major unmanaged stock indexes. It does not
take into account sales charges.
(3) The Fund began operations on 7/10/98. Index comparisons begin
on 6/30/98.
- --------------------------------------------------------------------------------
Fees and These tables describe the fees and expenses you may pay if you buy
Expenses and hold Class A, B or C shares of the Fund:
of the
Fund
Shareholder Fees (fees paid directly from your investment)
<TABLE>
<S> <C> <C>
Maximum Sales Charge (Load) Imposed Maximum Contingent Deferred Sales Charge (Load)
on Purchases (as a percentage of offering price) (as a percentage of original purchase price)
------------------------------------------------------------------------------------------------------
Class A 5.50% 1%(/1/)
------------------------------------------------------------------------------------------------------
Class B None 5%(/2/)
------------------------------------------------------------------------------------------------------
Class C None 1%(/3/)
------------------------------------------------------------------------------------------------------
</TABLE>
(1) Imposed only in certain circumstances where Class A shares are
purchased without a front-end sales charge at the time of
purchase.
(2) The maximum CDSC is imposed on shares redeemed in the first
year. For shares held longer than one year, the CDSC declines
according to the schedule set forth under "Investment
Options--Class A, B and C Shares--Contingent Deferred Sales
Charges (CDSCs)--Class B Shares."
(3) The CDSC on Class C shares is imposed only on shares redeemed
in the first year.
Annual Fund Operating Expenses (expenses that are deducted from
Fund assets)
<TABLE>
<S> <C> <C> <C> <C>
Distribution Total Annual
Advisory and/or Service Other Fund Operating
Share Class Fees (12b-1) Fees(/1/) Expenses(/2/) Expenses
-----------------------------------------------------------------
Class A 0.45% 0.25% 0.40% 1.10%
-----------------------------------------------------------------
Class B 0.45 1.00 0.40 1.85
-----------------------------------------------------------------
Class C 0.45 1.00 0.40 1.85
-----------------------------------------------------------------
</TABLE>
(1) Due to the 12b-1 distribution fee imposed on Class B and Class
C shares, a Class B or Class C shareholders may, depending
upon the length of time the shares are held, pay more than the
economic equivalent of the maximum front-end sales charges
permitted by relevant rules of the National Association of
Securities Dealers, Inc.
(2) Other Expenses reflects a 0.40% Administrative Fee paid by the
class, which is subject to a reduction of 0.05% on average daily
net assets attributable in the aggregate to the Fund's Class A, B
and C shares in excess of $2.5 billion.
Examples. The Examples are intended to help you compare the cost
of investing in Class A, B or C shares of the Fund with the costs
of investing in other mutual funds. The Examples assume that you
invest $10,000 in the noted class of shares for the time periods
indicated, your investment has a 5% return each year, the
reinvestment of all dividends and distributions, and the Fund's
operating expenses remain the same. Although your actual costs may
be higher or lower, the Examples show what your costs would be
based on these assumptions.
<TABLE>
<CAPTION>
Example: Assuming you do not
Example: Assuming you redeem your shares at the end of each period redeem your shares
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Share Class Year 1 Year 3 Year 5 Year 10 Year 1 Year 3 Year 5 Year 10
-----------------------------------------------------------------------------------------------------------
Class A $656 $880 $1,123 $1,816 $656 $880 $1,123 $1,816
-----------------------------------------------------------------------------------------------------------
Class B 688 882 1,201 1,876 188 582 1,001 1,876
-----------------------------------------------------------------------------------------------------------
Class C 288 582 1,001 2,169 188 582 1,001 2,169
-----------------------------------------------------------------------------------------------------------
</TABLE>
Prospectus
30
<PAGE>
PIMCO Value Fund
- --------------------------------------------------------------------------------
Principal Investment Fund Focus Approximate
Investments Objective Undervalued Capitalization Range
and Seeks long-term larger More than $10 billion
Strategies growth of capitalization
capital and stocks with
income improving
fundamentals
Dividend Frequency
Fund Category Approximate Number Quarterly
Value Stocks of Holdings
40
The Fund seeks to achieve its investment objective by normally
investing at least 65% of its assets in common stocks of companies
with market capitalizations of more than $10 billion at the time
of investment and below-average valuations whose business
fundamentals are expected to improve. To achieve income, the Fund
invests a portion of its assets in income-producing (e.g.,
dividend-paying) common stocks.
The portfolio manager selects stocks for the Fund using a "value"
style. The portfolio manager invests primarily in stocks of
companies having below-average valuations whose business
fundamentals are expected to improve. The portfolio manager
determines valuation based on characteristics such as price-to-
earnings, price-to-book, and price-to-cash flow ratios. The
portfolio manager analyzes stocks and seeks to identify the key
drivers of financial results and catalysts for change, such as new
management and new or improved products, that indicate a company
may demonstrate improving fundamentals in the future. The
portfolio manager looks to sell a stock when he believes that the
company's business fundamentals are weakening or when the stock's
valuation has become excessive.
The Fund may also invest in other kinds of equity securities,
including preferred stocks and convertible securities. The Fund
may invest up to 15% of its assets in foreign securities, usually
in the form of American Depository Receipts (ADRs). In response to
unfavorable market and other conditions, the Fund may make
temporary investments of some or all of its assets in high-quality
fixed income securities. This would be inconsistent with the
Fund's investment objective and principal strategies.
- --------------------------------------------------------------------------------
Principal Among the principal risks of investing in the Fund, which could
Risks adversely affect its net asset value, yield and total return, are:
. Market Risk . Foreign Investment Risk . Credit Risk
. Issuer Risk . Currency Risk . Management Risk
. Value Securities Risk
Please see "Summary of Principal Risks" following the Fund
Summaries for a description of these and other risks of investing
in the Fund.
- --------------------------------------------------------------------------------
Performance The top of the next page shows summary performance information for
Information the Fund in a bar chart and an Average Annual Total Returns table.
The information provides some indication of the risks of investing
in the Fund by showing changes in its performance from year to
year and by showing how the Fund's average annual returns compare
with the returns of a broad-based securities market index and an
index of similar funds. The bar chart and the information to its
right show performance of the Fund's Class A shares, but the
returns do not reflect the impact of sales charges (loads). If
they did, the returns would be lower than those shown. Unlike the
bar chart, performance for Class A, B and C shares in the Average
Annual Total Returns table reflects the impact of sales charges.
For periods prior to the inception of Class A, B and C shares
(1/13/97), performance information shown in the bar chart and
tables for those classes is based on the performance of the Fund's
Institutional Class shares, which are offered in a different
prospectus. The prior Institutional Class performance has been
adjusted to reflect the actual sales charges (in the Average
Annual Total Returns table only), distribution and/or service
(12b-1) fees, administrative fees and other expenses paid by Class
A, B and C shares. The Fund is expected to change sub-advisers on
or about May 8, 2000. The Fund would not necessarily have achieved
the performance results shown on the next page under its expected
new investment management arrangements. Past performance is no
guarantee of future results.
PIMCO Funds: Multi-Manager Series
31
<PAGE>
PIMCO Value Fund (continued)
Calendar Year Total Returns -- Class A
Highest and Lowest
Quarter Returns
(for periods shown
in the bar chart)
--------------------
Highest (4/1/99-
6/30/99) 17.73%
--------------------
Lowest (7/1/98-
9/30/98) -13.27%
[GRAPH]
1992 12.70%
1993 15.94%
1994 -4.46%
1995 38.37%
1996 19.87%
1997 25.71%
1998 9.76%
1999 3.81%
Calendar Year End (through 12/31)
Average Annual Total Returns (for periods ended 12/31/99)
<TABLE>
<S> <C> <C> <C>
Fund Inception
1 Year 5 Years (12/30/91)(/3/)
------------------------------------------------------------------------
Class A -1.90% 17.55% 13.84%
------------------------------------------------------------------------
Class B -1.16% 17.80% 13.91%
------------------------------------------------------------------------
Class C 2.21% 18.02% 13.81%
------------------------------------------------------------------------
S&P 500 Index(/1/) 21.04% 28.56% 19.70%
------------------------------------------------------------------------
Lipper Growth and Income Fund Average(/2/) 13.71% 21.37% 15.51%
------------------------------------------------------------------------
</TABLE>
(1) The S&P 500 Index is an unmanaged index of large
capitalization common stocks. It is not possible to invest
directly in the index.
(2) The Lipper Growth and Income Fund Average is a total return
performance average of funds tracked by Lipper Analytical
Services, Inc. that combine a growth-of-earnings orientation
and an income requirement for level and/or rising dividends.
It does not take into account sales charges.
(3) The Fund began operations on 12/30/91. Index comparisons begin
on 12/31/91.
- --------------------------------------------------------------------------------
Fees and These tables describe the fees and expenses you may pay if you buy
Expenses and hold Class A, B or C shares of the Fund:
of the
Fund
Shareholder Fees (fees paid directly from your investment)
<TABLE>
<S> <C> <C>
Maximum Sales Charge (Load) Imposed Maximum Contingent Deferred Sales Charge (Load)
on Purchases (as a percentage of offering price) (as a percentage of original purchase price)
------------------------------------------------------------------------------------------------------
Class A 5.50% 1%(/1/)
------------------------------------------------------------------------------------------------------
Class B None 5%(/2/)
------------------------------------------------------------------------------------------------------
Class C None 1%(/3/)
------------------------------------------------------------------------------------------------------
</TABLE>
(1) Imposed only in certain circumstances where Class A shares are
purchased without a front-end sales charge at the time of
purchase.
(2) The maximum CDSC is imposed on shares redeemed in the first
year. For shares held longer than one year, the CDSC declines
according to the schedule set forth under "Investment
Options--Class A, B and C Shares--Contingent Deferred Sales
Charges (CDSCs)--Class B Shares."
(3) The CDSC on Class C shares is imposed only on shares redeemed
in the first year.
Annual Fund Operating Expenses (expenses that are deducted from
Fund assets)
<TABLE>
<S> <C> <C> <C> <C>
Distribution Total Annual
Advisory and/or Service Other Fund Operating
Share Class Fees (12b-1) Fees(/1/) Expenses(/2/) Expenses
-----------------------------------------------------------------
Class A 0.45% 0.25% 0.40% 1.10%
-----------------------------------------------------------------
Class B 0.45 1.00 0.40 1.85
-----------------------------------------------------------------
Class C 0.45 1.00 0.40 1.85
-----------------------------------------------------------------
</TABLE>
(1) Due to the 12b-1 distribution fee imposed on Class B and Class
C shares, a Class B or Class C shareholders may, depending
upon the length of time the shares are held, pay more than the
economic equivalent of the maximum front-end sales charges
permitted by relevant rules of the National Association of
Securities Dealers, Inc.
(2) Other Expenses reflects a 0.40% Administrative Fee paid by the
class, which is subject to a reduction of 0.05% on average daily
net assets attributable in the aggregate to the Fund's Class A, B
and C shares in excess of $2.5 billion.
Examples. The Examples are intended to help you compare the cost
of investing in Class A, B or C shares of the Fund with the costs
of investing in other mutual funds. The Examples assume that you
invest $10,000 in the noted class of shares for the time periods
indicated, your investment has a 5% return each year, the
reinvestment of all dividends and distributions, and the Fund's
operating expenses remain the same. Although your actual costs may
be higher or lower, the Examples show what your costs would be
based on these assumptions.
<TABLE>
<CAPTION>
Example: Assuming you do not
Example: Assuming you redeem your shares at the end of each period redeem your shares
<S> <C> <C> <C> <C> <C> <C> <C> <C>
Share Class Year 1 Year 3 Year 5 Year 10 Year 1 Year 3 Year 5 Year 10
-----------------------------------------------------------------------------------------------------------
Class A $656 $880 $1,123 $1,816 $656 $880 $1,123 $1,816
-----------------------------------------------------------------------------------------------------------
Class B 688 882 1,201 1,876 188 582 1,001 1,876
-----------------------------------------------------------------------------------------------------------
Class C 288 582 1,001 2,169 188 582 1,001 2,169
-----------------------------------------------------------------------------------------------------------
</TABLE>
Prospectus
32
<PAGE>
Summary of Principal Risks
The value of your investment in a Fund changes with the values of
that Fund's investments. Many factors can affect those values. The
factors that are most likely to have a material effect on a
particular Fund's portfolio as a whole are called "principal
risks." The principal risks of each Fund are identified in the
Fund Summaries and are summarized in this section. Each Fund may
be subject to additional principal risks and risks other than
those described below because the types of investments made by a
Fund can change over time. Securities and investment techniques
mentioned in this summary and described in greater detail under
"Characteristics and Risks of Securities and Investment
Techniques" appear in bold type. That section and "Investment
Objectives and Policies" in the Statement of Additional
Information also include more information about the Funds, their
investments and the related risks. There is no guarantee that a
Fund will be able to achieve its investment objective.
Market The market price of securities owned by a Fund may go up or down,
Risk sometimes rapidly or unpredictably. Each of the Funds normally
invests most of its assets in common stocks and/or other equity
securities. A principal risk of investing in each Fund is that the
equity securities in its portfolio will decline in value due to
factors affecting equity securities markets generally or
particular industries represented in those markets. The values of
equity securities may decline due to general market conditions
which are not specifically related to a particular company, such
as real or perceived adverse economic conditions, changes in the
general outlook for corporate earnings, changes in interest or
currency rates or adverse investor sentiment generally. They may
also decline due to factors which affect a particular industry or
industries, such as labor shortages or increased production costs
and competitive conditions within an industry. Equity securities
generally have greater price volatility than fixed income
securities.
Issuer The value of a security may also decline for a number of reasons
Risk which directly relate to the issuer, such as management
performance, financial leverage and reduced demand for the
issuer's goods or services.
Value Each Fund may invest in companies that may not be expected to
Securities experience significant earnings growth, but whose securities its
Risk portfolio manager believes are selling at a price lower than their
true value. The Capital Appreciation, Equity Income, Mid-Cap,
Renaissance, Small-Cap Value and Value Funds place particular
emphasis on value securities. Companies that issue value
securities may have experienced adverse business developments or
may be subject to special risks that have caused their securities
to be out of favor. If a portfolio manager's assessment of a
company's prospects is wrong, or if the market does not recognize
the value of the company, the price of its securities may decline
or may not approach the value that the portfolio manager
anticipates.
Growth Each Fund may invest in equity securities of companies that its
Securities portfolio manager believes will experience relatively rapid
Risk earnings growth. The Capital Appreciation, Global Innovation,
Growth, Innovation, Mid-Cap, Opportunity, Select Growth and Target
Funds place particular emphasis on growth securities. Growth
securities typically trade at higher multiples of current earnings
than other securities. Therefore, the values of growth securities
may be more sensitive to changes in current or expected earnings
than the values of other securities.
Smaller The general risks associated with equity securities and liquidity
Company risk are particularly pronounced for securities of companies with
Risk smaller market capitalizations. These companies may have limited
product lines, markets or financial resources or they may depend
on a few key employees. Securities of smaller companies may trade
less frequently and in lesser volume than more widely held
securities and their values may fluctuate more sharply than other
securities. They may also trade in the over-the-counter market or
on a regional exchange, or may otherwise have limited liquidity.
The Global Innovation, Innovation, Opportunity and Small-Cap Value
Funds generally have substantial exposure to this risk. The Mid-
Cap and Target Funds also have significant exposure to this risk
because they invest substantial assets in companies with medium-
sized market capitalizations, which are smaller and generally
less-seasoned than the largest companies.
Liquidity All of the Funds are subject to liquidity risk. Liquidity risk
Risk exists when particular investments are difficult to purchase or
sell, possibly preventing a Fund from selling such illiquid
securities at an advantageous time or price. Funds with principal
investment strategies that involve securities of companies with
smaller market capitalizations, foreign securities, derivatives or
securities with substantial market and/or credit risk tend to have
the greatest exposure to liquidity risk.
PIMCO Funds: Multi-Manager Series
33
<PAGE>
Derivatives All Funds except the Capital Appreciation, Mid-Cap and Small-Cap
Risk Value Funds may use derivatives, which are financial contracts
whose value depends on, or is derived from, the value of an
underlying asset, reference rate or index. The various derivative
instruments that the Funds may use are referenced under
"Characteristics and Risks of Securities and Investment
Techniques--Derivatives" in this Prospectus and described in more
detail under "Investment Objectives and Policies" in the Statement
of Additional Information. The Funds may sometimes use derivatives
as part of a strategy designed to reduce exposure to other risks,
such as interest rate or currency risk. The Funds may also use
derivatives for leverage, which increases opportunities for gain
but also involves greater risk of loss due to leveraging risk. A
Fund's use of derivative instruments involves risks different
from, or possibly greater than, the risks associated with
investing directly in securities and other traditional
investments. Derivatives are subject to a number of risks
described elsewhere in this section, such as liquidity risk,
market risk, credit risk and management risk. They also involve
the risk of mispricing or improper valuation and the risk that
changes in the value of the derivative may not correlate perfectly
with the underlying asset, rate or index. In addition, a Fund's
use of derivatives may increase or accelerate the amount of taxes
payable by shareholders. A Fund investing in a derivative
instrument could lose more than the principal amount invested.
Also, suitable derivative transactions may not be available in all
circumstances and there can be no assurance that a Fund will
engage in these transactions to reduce exposure to other risks
when that would be beneficial.
Foreign A Fund that invests in foreign securities, and particularly the
(non- Global Innovation and International Funds, may experience more
U.S.) rapid and extreme changes in value than Funds that invest
Investment exclusively in securities of U.S. issuers or securities that trade
Risk exclusively in U.S. markets. The securities markets of many
foreign countries are relatively small, with a limited number of
companies representing a small number of industries. Additionally,
issuers of foreign securities are usually not subject to the same
degree of regulation as U.S. issuers. Reporting, accounting and
auditing standards of foreign countries differ, in some cases
significantly, from U.S. standards. Also, nationalization,
expropriation or confiscatory taxation, currency blockage,
political changes or diplomatic developments could adversely
affect a Fund's investments in a foreign country. In the event of
nationalization, expropriation or other confiscation, a Fund could
lose its entire investment in foreign securities. To the extent
that a Fund, such as the Global Innovation Fund or International
Fund, invests a significant portion of its assets in a narrowly
defined area such as Europe, Asia or South America, the Fund will
generally have more exposure to regional economic risks associated
with foreign investments. Adverse conditions in certain regions
(such as Southeast Asia) can also adversely affect securities of
other countries whose economies appear to be unrelated. In
addition, special U.S. tax considerations may apply to a Fund's
investment in foreign securities.
Emerging Foreign investment risk may be particularly high to the extent
Markets that a Fund invests in emerging market securities of issuers based
Risk in countries with developing economies. These securities may
present market, credit, currency, liquidity, legal, political and
other risks different from, or greater than, the risks of
investing in developed foreign countries. The Global Innovation
and International Funds may invest significant portions of their
assets in emerging market securities.
Currency Funds that invest directly in foreign currencies or in securities
Risk that trade in, and receive revenues in, foreign currencies are
subject to the risk that those currencies will decline in value
relative to the U.S. Dollar, or, in the case of hedging positions,
that the U.S. Dollar will decline in value relative to the
currency being hedged. The Global Innovation and International
Funds are particularly sensitive to currency risk. Currency rates
in foreign countries may fluctuate significantly over short
periods of time for a number of reasons, including changes in
interest rates, intervention (or the failure to intervene) by U.S.
or foreign governments, central banks or supranational entities
such as the International Monetary Fund, or by the imposition of
currency controls or other political developments in the U.S. or
abroad.
Focused Focusing Fund investments in a small number of issuers, industries
Investment or foreign currencies increases risk. Funds, such as the Select
Risk Growth Fund, that are "non-diversified" because they invest in a
relatively small number of issuers may have more risk because
changes in the value of a single security or the impact of a
single economic, political or regulatory occurrence may have a
greater adverse impact on the Fund's net asset value. Some of
those issuers also may present substantial credit or other risks.
The Global Innovation and International Funds may be subject to
increased risk to the extent that they focus their investments in
securities denominated in a particular foreign currency or in a
narrowly defined geographic area outside the U.S. Similarly, the
Global Innovation and Innovation Funds are vulnerable to events
affecting companies which use innovative
Prospectus
34
<PAGE>
technologies to gain a strategic, competitive advantage in their
industry and companies that provide and service those technologies
because these Funds normally "concentrate" their investments in
those companies. Also, the Funds may from time to time have
greater risk because they invest a substantial portion of their
assets in related industries such as "technology" or "financial
and business services."
Leveraging The Funds, and in particular the Global Innovation, International
Risk and Tax-Efficient Equity Funds, may engage in transactions or
purchase instruments that give rise to forms of leverage. Such
transactions and instruments may include, among others, the use of
reverse repurchase agreements and other borrowings, the investment
of collateral from loans of portfolio securities, or the use of
when-issued, delayed-delivery or forward commitment transactions.
The use of derivatives may also involve leverage. Leverage,
including borrowing, will cause the value of a Fund's shares to be
more volatile than if the Fund did not use leverage. This is
because leverage tends to exaggerate the effect of any increase or
decrease in the value of a Fund's portfolio securities. The use of
leverage may also cause a Fund to liquidate portfolio positions
when it would not be advantageous to do so in order to satisfy its
obligations or to meet segregation requirements.
Interest To the extent that Funds purchase fixed income securities for
Rate Risk investment or defensive purposes, they will be subject to interest
rate risk, a market risk relating to investments in fixed income
securities such as bonds and notes. As interest rates rise, the
value of fixed income securities in a Fund's portfolio are likely
to decrease.
Credit All of the Funds are subject to credit risk. This is the risk that
Risk the issuer or the guarantor of a fixed income security, or the
counterparty to a derivatives contract, repurchase agreement or a
loan of portfolio securities, is unable or unwilling to make
timely principal and/or interest payments, or to otherwise honor
its obligations. Securities are subject to varying degrees of
credit risk, which are often reflected in their credit ratings.
Management Each Fund is subject to management risk because it is an actively
Risk managed investment portfolio. PIMCO Advisors, the Sub-Advisers and
each individual portfolio manager will apply investment techniques
and risk analyses in making investment decisions for the Funds,
but there can be no guarantee that these will produce the desired
results.
Management of the Funds
Investment PIMCO Advisors serves as the investment adviser and the
Adviser administrator (serving in its capacity as administrator, the
and "Administrator") for the Funds. Subject to the supervision of the
Admin- Board of Trustees, PIMCO Advisors is responsible for managing,
istrator either directly or through others selected by it, the investment
activities of the Funds and the Funds' business affairs and other
administrative matters.
PIMCO Advisors is located at 800 Newport Center Drive, Newport
Beach, California 92660. Organized in 1987, PIMCO Advisors
provides investment management and advisory services to private
accounts of institutional and individual clients and to mutual
funds. As of December 31, 1999, PIMCO Advisors and its subsidiary
partnerships had more than $261 billion in assets under
management.
PIMCO Advisors has retained investment management firms ("Sub-
Advisers") to manage each Fund's investments, except that the
PIMCO Equity Advisors division of PIMCO Advisors manages the
investments of the Equity Income, Global Innovation, Growth,
Innovation, Opportunity, Renaissance, Select Growth, Target and
Value Funds (PIMCO Equity Advisors is also referred to as a "Sub-
Adviser" in this capacity). See "Sub-Advisers" below.
PIMCO Advisors has retained its affiliate, Pacific Investment
Management Company, to provide various administrative and other
services required by the Funds in its capacity as sub-
administrator. PIMCO Advisors and the sub-administrator may retain
other affiliates to provide certain of these services.
Advisory Each Fund pays PIMCO Advisors fees in return for providing or
Fees arranging for the provision of investment advisory services. In
the case of Funds for which PIMCO Advisors has retained a separate
Sub-Adviser, PIMCO Advisors (and not the Fund) pays a portion of
the advisory fees it receives to the Sub-Adviser in return for its
services.
PIMCO Funds: Multi-Manager Series
35
<PAGE>
For the fiscal year ended June 30, 1999, the Funds paid monthly
advisory fees to PIMCO Advisors at the following annual rates
(stated as a percentage of the average daily net assets of each
Fund taken separately):
<TABLE>
<CAPTION>
Fund Advisory Fees
----------------------------------------------------------------
<S> <C>
Capital Appreciation, Equity Income, Mid-Cap
and Value Funds 0.45%
Growth Fund 0.50%
International and Target Funds 0.55%
Select Growth 0.57%*
Renaissance and Small-Cap Value Funds 0.60%
Innovation and Opportunity Funds 0.65%
</TABLE>
* On April 1, 2000, the advisory fee rate for the Select Growth
Fund increased to 0.60% per annum.
The Global Innovation and Tax-Efficient Equity Funds were not
operational during the entire fiscal year ended June 30, 1999. The
annual investment advisory fee rates payable by these Funds are as
follows (stated as a percentage of the average daily net assets of
each Fund taken separately): Global Innovation--1.00%; Tax-
Efficient Equity--0.45%.
Admin- Each Fund pays for the administrative services it requires under a
istrative fee structure which is essentially fixed. Class A, Class B and
Fees Class C shareholders of each Fund pay an administrative fee to
PIMCO Advisors, computed as a percentage of the Fund's assets
attributable in the aggregate to those classes of shares. PIMCO
Advisors, in turn, provides or procures administrative services
for Class A, Class B and Class C shareholders and also bears the
costs of various third-party services required by the Funds,
including audit, custodial, portfolio accounting, legal, transfer
agency and printing costs. The result of this fee structure is an
expense level for Class A, Class B and Class C shareholders of
each Fund that, with limited exceptions, is precise and
predictable under ordinary circumstances.
For the fiscal year ended June 30, 1999, Class A, B and C
shareholders of the Funds paid PIMCO Advisors monthly
administrative fees at the following annual rates (stated as a
percentage of the average daily net assets attributable in the
aggregate to the Fund's Class A, Class B and Class C shares):
<TABLE>
<CAPTION>
Fund Administrative Fees*
-----------------------------------------
<S> <C> <C>
International Fund 0.65%
All Other Funds** 0.40%
</TABLE>
* The Administrative Fee rate for each Fund is subject to a
reduction of 0.05% per year on average daily net assets
attributable in the aggregate to the Fund's Class A, B and C
shares in excess of $2.5 billion.
** The Global Innovation and Tax-Efficient Equity Funds were not
operational during the entire fiscal year ended June 30, 1999.
Class A, B and C shareholders of these Funds pay administrative
fees at the annual rate of 0.60% and 0.40%, respectively, based
on average daily net assets attributable in the aggregate to
the Fund's Class A, Class B and Class C shares up to $2.5
billion, and 0.55% and 0.35%, respectively, based on such
average daily net assets in excess of $2.5 billion.
Sub- Each Sub-Adviser has full investment discretion and makes all
Advisers determinations with respect to the investment of a Fund's assets.
The following provides summary information about each Sub-Adviser,
including the Fund(s) it manages.
<TABLE>
<CAPTION>
Sub-Adviser* Funds
----------------------------------------------------------------------------
<S> <C>
PIMCO Equity Advisors Global Innovation, Equity Income, Growth, Innovation,
division of PIMCO
Advisors ("PIMCO Equity
Advisors")
1345 Avenue of the Opportunity, Renaissance, Select Growth,
Americas, 50th Floor
New York, NY 10105 Target and Value
----------------------------------------------------------------------------
Cadence Capital Capital Appreciation and Mid-Cap
Management ("Cadence")
Exchange Place, 53 State
Street
Boston, MA 02109
----------------------------------------------------------------------------
NFJ Investment Group Small-Cap Value
("NFJ")
2121 San Jacinto, Suite
1840
Dallas, TX 75201
----------------------------------------------------------------------------
Parametric Portfolio Tax-Efficient Equity
Associates
("Parametric")
7310 Columbia Center,
701 Fifth Avenue
Seattle, WA 98104
----------------------------------------------------------------------------
Blairlogie Capital International
Management
("Blairlogie")
4th Floor, 125 Princes
Street
Edinburgh EH2 4AD,
Scotland
</TABLE>
* PIMCO Equity Advisors is a division of PIMCO Advisors. With the
exception of Blairlogie, each of the other Sub-Advisers is an
affiliated sub-partnership of PIMCO Advisors.
Prospectus
36
<PAGE>
The following provides additional information about each Sub-
Adviser and the individual portfolio managers who have or share
primary responsibility for managing the Funds' investments.
PIMCO A division of PIMCO Advisors, PIMCO Equity Advisors provides
Equity equity-related advisory services to mutual funds and institutional
Advisors accounts. See "Investment Adviser and Administrator" above for
additional information about PIMCO Advisors.
The following individuals at PIMCO Equity Advisors have primary
responsibility for the noted Funds. A different sub-advisory firm
served as Sub-Adviser for the Growth, Innovation, Opportunity and
Target Funds prior to March 6, 1999, for the Renaissance Fund
prior to May 7, 1999, and for the Select Growth Fund prior to July
1, 1999. In addition, on or about May 8, 2000, it is expected that
PIMCO Equity Advisors will assume the position of Sub-Adviser to
the Equity Income and Value Funds from NFJ, the Funds' current
Sub-Adviser.
<TABLE>
<CAPTION>
Fund Portfolio Managers Since Recent Professional Experience
-------------------------------------------------------------------------------------------
<C> <C> <C> <S>
Equity Income Kenneth W. Corba 2000* Managing Director and
Chief Investment Officer
of PIMCO Equity Advisors
and a Member of the
Management Board of
PIMCO Advisors. Prior to
joining PIMCO Advisors,
he was with Eagle Asset
Management from 1995 to
1998, serving in various
capacities including as
Chief Investment Officer
and Portfolio Manager.
He was with Stein Roe
and Farnham Inc. from
1984 to 1995, serving in
various capacities
including as Director of
the Capital Management
Group, Senior Vice
President and Portfolio
Manager.
Global Innovation Dennis P. McKechnie 1999 (inception)+ Portfolio Manager of
PIMCO Equity Advisors.
Prior to joining PIMCO
Advisors, he was with
Columbus Circle
Investors from 1991 to
1999, where he managed
equity accounts and
served in various
capacities including as
Portfolio Manager for
the Innovation Fund.
Growth Mr. Corba 1999 See above.
Innovation Mr. McKechnie 1998 See above.
Opportunity Michael F. Gaffney 1999 Managing Director of
PIMCO Equity Advisors,
where he manages the
Opportunity Fund and
other small-cap
products. Prior to
joining PIMCO Advisors,
he was with Alliance
Capital Management L.P.
from 1993 to 1999,
serving in various
capacities including as
Senior Vice President
and Portfolio Manager.
Renaissance John K. Schneider 1999 Senior Portfolio Manager
of PIMCO Equity
Advisors. Prior to
joining PIMCO Advisors,
he was a partner and
Portfolio Manager of
Schneider Capital
Management from 1996 to
1999, where he managed
equity accounts for
various institutional
clients. Prior to that
he was a member of the
Equity Policy Committee
and Director of Research
at Newbold's Asset
Management from 1991 to
1996.
Select Growth Messrs. Corba and Schneider 1999 See above.
Target Mr. Corba 1999 See above.
Jeff Parker 1999 Assistant Portfolio
Manager and Research
Analyst for PIMCO Equity
Advisors. Prior to
joining PIMCO Equity
Advisors, he managed
equity accounts as an
Assistant Portfolio
Manager at Eagle Asset
Management from 1996 to
1998. He was a Senior
Consultant with Andersen
Consulting, specializing
in healthcare and
technology, from 1991 to
1994.
Value Mr. Schneider 2000* See above.
</TABLE>
-------
* Expected.
+ Prior to PIMCO Advisors and PIMCO Equity Advisors assuming their
positions as Adviser and Sub-Adviser, respectively, of the
Global Innovation Fund, Mr. McKechnie managed the Fund's
portfolio in his capacity as an officer of the Trust.
Cadence An affiliated subpartnership of PIMCO Advisors, Cadence provides
advisory services to mutual funds and institutional accounts.
Cadence Capital Management Corporation, the predecessor investment
adviser to Cadence, commenced operations in 1988. Accounts managed
by Cadence had combined assets as of December 31, 1999 of
approximately $6.4 billion.
PIMCO Funds: Multi-Manager Series
37
<PAGE>
The following individuals at Cadence share primary responsibility
for each of the noted Funds.
<TABLE>
<CAPTION>
Recent Professional
Fund Portfolio Managers Since Experience
---------------------------------------------------------------------------------------------
<C> <C> <C> <S>
Capital Appreciation David B. Breed 1991 (Inception) Managing Director, Chief
Executive Officer, Chief
Investment Officer and
founding partner of
Cadence. Member of the
Management Board of
PIMCO Advisors. He is a
research generalist and
has lead the team of
portfolio managers and
analysts since 1988. Mr.
Breed has managed
separate equity accounts
for many institutional
clients and has lead the
team that manages the
PIMCO Funds sub-advised
by Cadence since those
Funds' inception dates.
William B. Bannick 1992 Managing Director and
Executive Vice President
at Cadence. Mr. Bannick
is a research generalist
and Senior Portfolio
Manager for the Cadence
team. He has managed
separately managed
equity accounts for
various Cadence
institutional clients
and has been a member of
the team that manages
the PIMCO Funds sub-
advised by Cadence since
joining Cadence in 1992.
Katherine A. Burdon 1993 Managing Director and
Senior Portfolio Manager
at Cadence. Ms. Burdon
is a research generalist
and has managed
separately managed
equity accounts for
various Cadence
institutional clients
and has been a member of
the team that manages
the PIMCO Funds sub-
advised by Cadence since
joining Cadence in 1993.
Peter B. McManus 1994 Director, Account
Management at Cadence.
He has been a member of
the investment team at
Cadence and handles
client relationships of
separately managed
accounts, and has been a
member of the team that
manages the PIMCO Funds
sub-advised by Cadence
since joining Cadence in
1994. Previously, he
served as a Vice
President of Bank of
Boston from 1991 to
1994.
Mid-Cap Messrs. Breed, Bannick and Same as Capital See above.
McManus and Ms. Burdon Appreciation Fund
NFJ An affiliated sub-partnership of PIMCO Advisors, NFJ provides
advisory services to mutual funds and institutional accounts. NFJ
Investment Group, Inc., the predecessor investment adviser to NFJ,
commenced operations in 1989. Accounts managed by NFJ had combined
assets as of December 31, 1999 of approximately $2.1 billion.
The following individuals at NFJ share primary responsibility for
the noted Fund.
<CAPTION>
Fund Portfolio Managers Since Recent Professional Experience
---------------------------------------------------------------------------------------------
<C> <C> <C> <S>
Small-Cap Value Chris Najork 1991 (Inception) Managing Director and
founding partner of NFJ.
He has 30 years"
experience encompassing
equity research and
portfolio management.
Prior to the formation
of NFJ in 1989, he was a
Senior Vice President,
Senior Portfolio Manager
and analyst at
NationsBank, which he
joined in 1974.
Benno J. Fischer 1991 (Inception) Managing Director and
founding partner of NFJ.
He has 32 years"
experience in portfolio
management, investment
analysis and research.
Prior to the formation
of NFJ in 1989, he was
Chief Investment Officer
(institutional and fixed
income), Senior Vice
President and Senior
Portfolio Manager at
NationsBank, which he
joined in 1971. Prior to
joining NationsBank, Mr.
Fischer was a securities
analyst at Chase
Manhattan Bank and
Clark, Dodge.
Paul A. Magnuson 1995 Principal at NFJ. He is
a Portfolio Manager and
Senior Research Analyst
with 14 years'
experience in equity
analysis and portfolio
management. Prior to
joining NFJ in 1992, he
was an Assistant Vice
President at
NationsBank, which he
joined in 1985. Within
the Trust Investment
Quantitative Services
Division of NationsBank,
he was responsible for
equity analytics and
structured fund
management.
An affiliated sub-partnership of PIMCO Advisors, Parametric
provides advisory services to mutual funds and institutional
accounts. Parametric Portfolio Associates, Inc., the predecessor
investment adviser to Parametric, commenced operations in 1987.
Accounts managed by Parametric had combined assets as of December
31, 1999 of approximately $4.1 billion.
</TABLE>
Parametric
Prospectus
38
<PAGE>
The following individuals at Parametric share primary
responsibility for the Tax-Efficient Equity Fund.
<TABLE>
<CAPTION>
Fund Portfolio Managers Since Recent Professional Experience
-----------------------------------------------------------------------------
<C> <C> <C> <S>
Tax-Efficient David Stein 1998 (Inception) Managing Director of
Equity Parametric. He also
serves as a Senior
Portfolio
Manager of PIMCO Equity
Advisors. He has been
with Parametric since
1996
where he leads the
investment, research and
product development
activities.
Previously, he served in
Investment Research at
GTE Corporation from
1995
to 1996, in Equity
Research at Vanguard
Group from 1994 to 1995
and in
Investment Research at
IBM Corporation from
1977 to 1994.
Tom Seto 1998 (Inception) Vice President and
Portfolio Manager of
Parametric. Since
joining Parametric
in 1998, he has been
responsible for
management of
Parametric's active U.S.
equity strategies and
has managed structured
equity portfolios.
Previously, he
was with Barclays Global
Investors from 1991 to
1998, serving in various
capacities including as
head of U.S. Equity
Index Investments and
Portfolio
Manager.
Blairlogie Blairlogie provides advisory services to mutual funds and
institutional accounts. Blairlogie Capital Management Ltd., the
predecessor investment adviser to Blairlogie, commenced operations
in 1992. Accounts managed by Blairlogie had combined assets as of
December 31, 1999 of approximately $1.4 billion.
Blairlogie is an indirect majority-owned subsidiary of the
Alleghany Corporation, and is not an affiliate of PIMCO Advisors.
Blairlogie was formerly an affiliated sub-partnership of PIMCO
Advisors. On April 30, 1999, PIMCO Advisors sold all of its
ownership interest in Blairlogie to subsidiaries of the Alleghany
Corporation. PIMCO Advisors retained Blairlogie as the Sub-Adviser
of the International Fund both prior and subsequent to this
transaction.
The following individual at Blairlogie has primary responsibility
for the International Fund.
<CAPTION>
Fund Portfolio Manager Since Recent Professional Experience
-----------------------------------------------------------------------------
<C> <C> <C> <S>
International James Smith 1994 Chief Investment Officer
of Blairlogie since
1992, responsible for
setting investment
policy, asset
allocation, managing the
investment team and
stock selection in Latin
America.
</TABLE>
Distributor The Trust's Distributor is PIMCO Funds Distributors LLC, a wholly
owned subsidiary of PIMCO Advisors. The Distributor, located at
2187 Atlantic Street, Stanford, CT 06902, is a broker-dealer
registered with the Securities and Exchange Commission.
PIMCO Funds: Multi-Manager Series
39
<PAGE>
Investment Options -- Class A, B and C Shares
The Trust offers investors Class A, Class B and Class C shares of
each Fund in this Prospectus. Each class of shares is subject to
different types and levels of sales charges than the other classes
and bears a different level of expenses.
The class of shares that is best for you depends upon a number of
factors, including the amount and the intended length of your
investment. The following summarizes key information about each
class to help you make your investment decision, including the
various expenses associated with each class. More extensive
information about the Trust's multi-class arrangements is included
in the PIMCO Funds Shareholders' Guide for Class A, B and C Shares
(the "Guide"), which is included as part of the Statement of
Additional Information and can be obtained free of charge from the
Distributor. See "How to Buy and Sell Shares--PIMCO Funds
Shareholders' Guide" below.
Class A . You pay an initial sales charge of up to 5.50% when you buy
Shares Class A shares. The sales charge is deducted from your
investment so that not all of your purchase payment is invested.
. You may be eligible for a reduction or a complete waiver of the
initial sales charge under a number of circumstances. For
example, you normally pay no sales charge if you purchase
$1,000,000 or more of Class A shares. Please see the Guide for
details.
. Class A shares are subject to lower 12b-1 fees than Class B or
Class C shares. Therefore, Class A shareholders generally pay
lower annual expenses and receive higher dividends than Class B
or Class C shareholders.
. You normally pay no contingent deferred sales charge ("CDSC")
when you redeem Class A shares, although you may pay a 1% CDSC
if you purchase $1,000,000 or more of Class A shares (and
therefore pay no initial sales charge) and then redeem the
shares during the first 18 months after your initial purchase.
The Class A CDSC is waived for certain categories of investors
and does not apply if you are otherwise eligible to purchase Class
A shares without a sales charge. Please see the Guide for details.
Class B . You do not pay an initial sales charge when you buy Class B
Shares shares. The full amount of your purchase payment is invested
initially.
. You normally pay a CDSC of up to 5% if you redeem Class B shares
during the first six years after your initial purchase. The
amount of the CDSC declines the longer you hold your Class B
shares. You pay no CDSC if you redeem during the seventh year
and thereafter. The Class B CDSC is waived for certain categories
of investors. Please see the Guide for details.
. Class B shares are subject to higher 12b-1 fees than Class A
shares for the first seven years they are held. During this
time, Class B shareholders normally pay higher annual expenses
and receive lower dividends than Class A shareholders.
. Class B shares automatically convert into Class A shares after
they have been held for seven years. After the conversion takes
place, the shares are subject to the lower 12b-1 fees paid by
Class A shares.
Class C . You do not pay an initial sales charge when you buy Class C
Shares shares. The full amount of your purchase payment is invested
initially.
. You normally pay a CDSC of 1% if you redeem Class C shares
during the first year after your initial purchase. The Class C
CDSC is waived for certain categories of investors. Please see
the Guide for details.
. Class C shares are subject to higher 12b-1 fees than Class A
shares. Therefore, Class C shareholders normally pay higher
annual expenses and receive lower dividends than Class A
shareholders.
. Class C shares do not convert into any other class of shares.
Because Class B shares convert into Class A shares after seven
years, Class C shares will normally be subject to higher
expenses and will pay lower dividends than Class B shares if the
shares are held for more than seven years.
The following provides additional information about the sales
charges and other expenses associated with Class A, Class B and
Class C shares.
- --------------------------------------------------------------------------------
Initial Unless you are eligible for a waiver, the public offering price
Sales you pay when you buy Class A shares of the Funds is the net asset
Charges-- value ("NAV") of the shares plus an initial sales charge. The
Class A initial sales charge varies depending upon the size of your
Shares purchase, as set forth below. No sales charge is imposed where
Class A shares are issued to you pursuant to the automatic
reinvestment of income dividends or capital gains distributions.
Prospectus
40
<PAGE>
All Funds
<TABLE>
<S> <C> <C>
Initial Sales Charge Initial Sales Charge
Amount of as % of Net as % of Public
Purchase Amount Invested Offering Price
-------------------------------------------------------------------
$0-$49,999 5.82% 5.50%
-------------------------------------------------------------------
$50,000-$99,999 4.71% 4.50%
-------------------------------------------------------------------
$100,000-$249,999 3.63% 3.50%
-------------------------------------------------------------------
$250,000-$499,999 2.56% 2.50%
-------------------------------------------------------------------
$500,000-$999,999 2.04% 2.00%
-------------------------------------------------------------------
$1,000,000 + 0.00%* 0.00%*
-------------------------------------------------------------------
*As shown, investors that purchase $1,000,000 or more of any
Fund's Class A shares will not pay any initial sales charge on the
purchase. However, purchasers of $1,000,000 or more of Class A
shares may be subject to a CDSC of 1% if the shares are redeemed
during the first 18 months after their purchase. See "CDSCs on
Class A Shares" below.
- -------------------------------------------------------------------------------
Contingent Unless you are eligible for a waiver, if you sell (redeem) your
Deferred Class B or Class C shares within the time periods specified below,
Sales you will pay a CDSC according to the following schedules.
Charges
(CDSCs)
- -- Class
B and
Class C
Shares
Class B Years Since Purchase Percentage Contingent
Shares Payment was Made Deferred Sales Charge
-------------------------------------------------------------------
First 5
-------------------------------------------------------------------
Second 4
-------------------------------------------------------------------
Third 3
-------------------------------------------------------------------
Fourth 3
-------------------------------------------------------------------
Fifth 2
-------------------------------------------------------------------
Sixth 1
-------------------------------------------------------------------
Seventh 0*
-------------------------------------------------------------------
*After the seventh year, Class B shares convert into Class A
shares.
Class C Years Since Purchase Percentage Contingent
Shares Payment was Made Deferred Sales Charge
-------------------------------------------------------------------
First 1
-------------------------------------------------------------------
Thereafter 0
-------------------------------------------------------------------
</TABLE>
- --------------------------------------------------------------------------------
CDSCs on Unless a waiver applies, investors who purchase $1,000,000 or more
Class A of Class A shares (and, thus, pay no initial sales charge) will be
Shares subject to a 1% CDSC if the shares are redeemed within 18 months
of their purchase. The Class A CDSC does not apply if you are
otherwise eligible to purchase Class A shares without an initial
sales charge or if you are eligible for a waiver of the CDSC. See
"Reductions and Waivers of Initial Sales Charges and CDSCs" below.
- --------------------------------------------------------------------------------
How CDSCs A CDSC is imposed on redemptions of Class B and Class C shares
are (and where applicable, Class A shares) on the amount of the
Calculated redemption which causes the current value of your account for the
particular class of shares of a Fund to fall below the total
dollar amount of your purchase payments subject to the CDSC.
However, no CDSC is imposed if the shares redeemed have been
acquired through the reinvestment of dividends or capital gains
distributions or if the amount redeemed is derived from increases
in the value of your account above the amount of the purchase
payments subject to the CDSC. CDSCs are deducted from the proceeds
of your redemption, not from amounts remaining in your account. In
determining whether a CDSC is payable, it is assumed that the
purchase payment from which the redemption is made is the earliest
purchase payment for the particular class of shares in your
account (from which a redemption or exchange has not already been
effected).
For instance, the following example illustrates the operation of
the Class B CDSC:
. Assume that an individual opens an account and makes a purchase
payment of $10,000 for Class B shares of a Fund and that six
months later the value of the investor's account for that Fund
has grown through investment performance and reinvestment of
distributions to $11,000. The investor then may redeem up to
$1,000 from that Fund ($11,000 minus $10,000) without incurring
a CDSC. If the investor should redeem $3,000, a CDSC would be
imposed on $2,000 of the redemption (the amount by which the
investor's account for the Fund was reduced below the amount of
the purchase payment). At the rate of 5%, the Class B CDSC would
be $100.
PIMCO Funds: Multi-Manager Series
41
<PAGE>
In determining whether an amount is available for redemption
without incurring a CDSC, the purchase payments made for all
shares of a particular class of a Fund in the shareholder's
account are aggregated, and the current value of all such shares
is aggregated.
- --------------------------------------------------------------------------------
Reductions The initial sales charges on Class A shares and the CDSCs on Class
and A, Class B and Class C shares may be reduced or waived under
Waivers certain purchase arrangements and for certain categories of
of investors. Please see the Guide for details. The Guide is
Initial available free of charge from the Distributor. See "How to Buy and
Sales Sell Shares--PIMCO Funds Shareholders' Guide" below.
Charges
and CDSCs
- --------------------------------------------------------------------------------
Distri- The Funds pay fees to the Distributor on an ongoing basis as
bution and compensation for the services the Distributor renders and the
Servicing expenses it bears in connection with the sale and distribution of
(12b-1) Fund shares ("distribution fees") and/or in connection with
Plans personal services rendered to Fund shareholders and the
maintenance of shareholder accounts ("servicing fees"). These
payments are made pursuant to Distribution and Servicing Plans
("12b-1 Plans") adopted by each Fund pursuant to Rule 12b-1 under
the Investment Company Act of 1940.
There is a separate 12b-1 Plan for each class of shares offered
in this Prospectus. Class A shares pay only servicing fees. Class
B and Class C shares pay both distribution and servicing fees. The
following lists the maximum annual rates at which the distribution
and/or servicing fees may be paid under each 12b-1 Plan
(calculated as a percentage of each Fund's average daily net
assets attributable to the particular class of shares):
<TABLE>
<S> <C> <C>
Servicing Distribution
All Funds Fee Fee
------------------------------------------------------------------------------------
Class A 0.25% None
------------------------------------------------------------------------------------
Class B 0.25% 0.75%
------------------------------------------------------------------------------------
Class C 0.25% 0.75%
------------------------------------------------------------------------------------
</TABLE>
Because 12b-1 fees are paid out of a Fund's assets on an ongoing
basis, over time these fees will increase the cost of your
investment and may cost you more than sales charges which are
deducted at the time of investment. Therefore, although Class B
and Class C shares do not pay initial sales charges, the
distribution fees payable on Class B and Class C shares may, over
time, cost you more than the initial sales charge imposed on Class
A shares. Also, because Class B shares convert into Class A shares
after they have been held for seven years and are not subject to
distribution fees after the conversion, an investment in Class C
shares may cost you more over time than an investment in Class B
shares.
How Fund Shares Are Priced
The net asset value ("NAV") of a Fund's Class A, Class B and Class
C shares is determined by dividing the total value of a Fund's
portfolio investments and other assets attributable to that class,
less any liabilities, by the total number of shares outstanding of
that class.
For purposes of calculating the NAV, portfolio securities and
other assets for which market quotes are available are stated at
market value. Market value is generally determined on the basis of
last reported sales prices, or if no sales are reported, based on
quotes obtained from a quotation reporting system, established
market makers, or pricing services. Certain securities or
investments for which daily market quotes are not readily
available may be valued, pursuant to guidelines established by the
Board of Trustees, with reference to other securities or indices.
Short-term investments having a maturity of 60 days or less are
generally valued at amortized cost. Exchange traded options,
futures and options on futures are valued at the settlement price
determined by the exchange. Other securities for which market
quotes are not readily available are valued at fair value as
determined in good faith by the Board of Trustees or persons
acting at their direction.
Investments initially valued in currencies other than the U.S.
dollar are converted to U.S. dollars using exchange rates obtained
from pricing services. As a result, the NAV of a Fund's shares may
be affected by changes in the value of currencies in relation to
the U.S. dollar. The value of securities traded in markets outside
the United States or denominated in currencies other than the U.S.
dollar may be affected significantly on a day that the New York
Stock Exchange is closed and an investor is not able to purchase,
redeem or exchange shares. In particular, calculation of the NAV
of the Global Innovation and International Funds may not take
place contemporaneously with the determination of the prices of
foreign securities used in NAV calculations.
Prospectus
42
<PAGE>
Fund shares are valued at the close of regular trading (normally
4:00 p.m., Eastern time) (the "NYSE Close") on each day that the
New York Stock Exchange is open. For purposes of calculating the
NAV, the Funds normally use pricing data for domestic equity
securities received shortly after the NYSE Close and do not
normally take into account trading, clearances or settlements that
take place after the NYSE Close. Domestic fixed income and foreign
securities are normally priced using data reflecting the earlier
closing of the principal markets for those securities. Information
that becomes known to the Funds or their agents after the NAV has
been calculated on a particular day will not generally be used to
retroactively adjust the price of a security or the NAV determined
earlier that day.
In unusual circumstances, instead of valuing securities in the
usual manner, the Funds may value securities at fair value or
estimate their value as determined in good faith by the Board of
Trustees pursuant to procedures approved by the Board of Trustees.
Fair valuation may also be used by the Board of Trustees if
extraordinary events occur after the close of the relevant market
but prior to the NYSE Close.
How to Buy and Sell Shares
The following section provides basic information about how to buy,
sell (redeem) and exchange shares of the Funds.
PIMCO More detailed information about the Trust's purchase, sale and
Funds exchange arrangements for Fund shares is provided in the PIMCO
Share- Funds Shareholders' Guide, which is included in the Statement of
holders' Additional Information and can be obtained free of charge from the
Guide Distributor by written request or by calling 1-800-426-0107. The
Guide provides technical information about the basic arrangements
described below and also describes special purchase, sale and
exchange features and programs offered by the Trust, including:
. Automated telephone and wire transfer procedures
. Automatic purchase, exchange and withdrawal programs
. Programs that establish a link from your Fund account to your
bank account
. Special arrangements for tax-qualified retirement plans
. Investment programs which allow you to reduce or eliminate the
initial sales charges on Class A shares
. Categories of investors that are eligible for waivers or
reductions of initial sales charges and CDSCs
Calculation When you buy shares of the Funds, you pay a price equal to the NAV
of Share of the shares, plus any applicable sales charge. When you sell
Price and (redeem) shares, you receive an amount equal to the NAV of the
Redemption shares, minus any applicable CDSC. NAVs are determined at the
Payments close of regular trading (normally, 4:00 p.m., Eastern time) on
the New York Stock Exchange on each day the New York Stock
Exchange is open. See "How Fund Shares Are Priced" above for
details. Generally, purchase and redemption orders for Fund shares
are processed at the NAV next calculated after your order is
received by the Distributor. There are certain exceptions where an
order is received by a broker or dealer prior to the close of
regular trading on the New York Stock Exchange and then
transmitted to the Distributor after the NAV has been calculated
for that day (in which case the order may be processed at that
day's NAV). Please see the Guide for details.
The Trust does not calculate NAVs or process orders on days when
the New York Stock Exchange is closed. If your purchase or
redemption order is received by the Distributor on a day when the
New York Stock Exchange is closed, it will be processed on the
next succeeding day when the New York Stock Exchange is open (at
the succeeding day's NAV).
Buying You can buy Class A, Class B or Class C shares of the Funds in the
Shares following ways:
. Through your broker, dealer or other financial intermediary.
Your broker, dealer or other intermediary may establish higher
minimum investment requirements than the Trust and may also
independently charge you transaction fees and additional
amounts (which may vary) in return for its services, which will
reduce your return. Shares you purchase through your broker,
dealer or other intermediary will normally be held in your
account with that firm.
PIMCO Funds: Multi-Manager Series
43
<PAGE>
. Directly from the Trust. To make direct investments, you must
open an account with the Distributor and send payment for your
shares either by mail or through a variety of other purchase
options and plans offered by the Trust.
If you wish to invest directly by mail, please send a check
payable to PIMCO Funds Distributors LLC, along with a completed
application form to:
PIMCO Funds Distributors LLC
P.O. Box 9688
Providence, RI 02940-0926
The Trust accepts all purchases by mail subject to collection of
checks at full value and conversion into federal funds. You may
make subsequent purchases by mailing a check to the address above
with a letter describing the investment or with the additional
investment portion of a confirmation statement. Checks for
subsequent purchases should be payable to PIMCO Funds Distributors
LLC and should clearly indicate your account number. Please call
the Distributor at 1-800-426-0107 if you have any questions
regarding purchases by mail.
The Guide describes a number of additional ways you can make
direct investments, including through the PIMCO Funds Auto-Invest
and PIMCO Funds Fund Link programs. You can obtain a Guide free of
charge from the Distributor by written request or by calling 1-
800-426-0107. See "PIMCO Funds Shareholders' Guide" above.
The Distributor, in its sole discretion, may accept or reject any
order for purchase of Fund shares. No share certificates will be
issued unless specifically requested in writing.
Investment The following investment minimums apply for purchases of Class A,
Minimums Class B and Class C shares.
<TABLE>
<CAPTION>
Initial Investment Subsequent Investments
------------------ ----------------------
<S> <C>
$2,500 per Fund $100 per Fund
</TABLE>
Lower minimums may apply for certain categories of investors,
including certain tax-qualified retirement plans, and for special
investment programs and plans offered by the Trust, such as the
PIMCO Funds Auto-Invest and PIMCO Funds Fund Link programs. Please
see the Guide for details.
Small Because of the disproportionately high costs of servicing accounts
Account with low balances, if you have a direct account with the
Fee Distributor, you will be charged a fee at the annual rate of $16
if your account balance for any Fund falls below a minimum level
of $2,500, except for Uniform Gift to Minors, IRA, Roth IRA and
Auto-Invest accounts for which the limit is $1,000. The fee also
applies to employer-sponsored retirement plan accounts, Money
Purchase and/or Profit Sharing plans, 401(k) plans, 403(b)(7)
custodial accounts, SIMPLE IRAs, SEPs and SAR/SEPs. (A separate
custodial fee may apply to IRAs, Roth IRAs and other retirement
accounts.) However, you will not be charged this fee if the
aggregate value of all of your PIMCO Funds accounts is at least
$50,000. Any applicable small account fee will be deducted
automatically from your below-minimum Fund account in quarterly
installments and paid to the Administrator. Each Fund account will
normally be valued, and any deduction taken, during the last five
business days of each calendar quarter. Lower minimum balance
requirements and waivers of the small account fee apply for
certain categories of investors. Please see the Guide for details.
Minimum Due to the relatively high cost to the Funds of maintaining small
Account accounts, you are asked to maintain an account balance in each
Size Fund in which you invest of at least the minimum investment
necessary to open the particular type of account. If your balance
for any Fund remains below the minimum for three months or longer,
the Administrator has the right (except in the case of employer-
sponsored retirement accounts) to redeem your remaining shares and
close that Fund account after giving you 60 days to increase your
balance. Your Fund account will not be liquidated if the reduction
in size is due solely to a decline in market value of your Fund
shares or if the aggregate value of all your PIMCO Funds accounts
exceeds $50,000.
Exchanging Except as provided below and/or in the applicable Funds' or
Shares series' prospectus(es), you may exchange your Class A, Class B or
Class C shares of any Fund for the same Class of shares of any
other Fund or of another series of the Trust or PIMCO Funds:
Pacific Investment Management Series. Shares are exchanged on the
basis of their respective NAVs next calculated after your exchange
order is received by
Prospectus
44
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the Distributor. Currently, the Trust does not charge any exchange
fees or charges. Exchanges are subject to the $2,500 minimum
initial purchase requirements for each Fund, except with respect
to tax-qualified programs and exchanges effected through the PIMCO
Funds Auto-Exchange plan. In addition, an exchange is generally a
taxable event which will generate capital gains or losses, and
special rules may apply in computing tax basis when determining
gain or loss. If you maintain your account with the Distributor,
you may exchange shares by completing a written exchange request
and sending it to PIMCO Funds Distributors LLC, P.O. Box 9688,
Providence, RI 02940-0926. You can get an exchange form by calling
the Distributor at 1-800-426-0107.
The Trust reserves the right to refuse exchange purchases if, in
the judgment of PIMCO Advisors, the purchase would adversely
affect a Fund and its shareholders. In particular, a pattern of
exchanges characteristic of "market-timing" strategies may be
deemed by PIMCO Advisors to be detrimental to the Trust or a
particular Fund. Currently, the Trust limits the number of "round
trip" exchanges an investor may make. An investor makes a "round
trip" exchange when the investor purchases shares of a particular
Fund, subsequently exchanges those shares for shares of a
different PIMCO Fund and then exchanges back into the originally
purchased Fund. The Trust has the right to refuse any exchange for
any investor who completes (by making the exchange back into the
shares of the originally purchased Fund) more than six round trip
exchanges in any twelve-month period. Although the Trust has no
current intention of terminating or modifying the exchange
privilege other than as set forth in the preceeding sentence, it
reserves the right to do so at any time. Except as otherwise
permitted by the Securities and Exchange Commission, the Trust
will give you 60 days' advance notice if it exercises its right to
terminate or materially modify the exchange privilege with respect
to Class A, B and C shares.
. Exchange Limitations. Until July 3, 2000, shareholders will
not be permitted to exchange their shares of any Fund or series of
the Trust or of PIMCO Funds: Pacific Investment Management Series
for shares of the Global Innovation Fund, although investors will
be permitted to exchange their shares of the Global Innovation
Fund for shares of the same class of any other Fund or series of
the Trust or of PIMCO Funds: Pacific Investment Management Series.
This restriction may be changed or eliminated at any time at the
discretion of the Distributor.
The Guide provides more detailed information about the exchange
privilege, including the procedures you must follow and additional
exchange options. You can obtain a Guide free of charge from the
Distributor by written request or by calling 1-800-426-0107. See
"PIMCO Funds Shareholders' Guide" above.
Selling You can sell (redeem) Class A, Class B or Class C shares of the
Shares Funds in the following ways:
. Through your broker, dealer or other financial intermediary.
Your broker, dealer or other intermediary may independently charge
you transaction fees and additional amounts (which may vary) in
return for its services, which will reduce your return.
. Directly from the Trust by Written Request. To redeem shares
directly from the Trust by written request (whether or not the
shares are represented by certificates), you must send the
following items to the Trust's Transfer Agent, PFPC, Inc., P.O.
Box 9688, Providence, RI 02940-0926:
(1) a written request for redemption signed by all registered
owners exactly as the account is registered on the Transfer
Agent's records, including fiduciary titles, if any, and
specifying the account number and the dollar amount or number of
shares to be redeemed;
(2) for certain redemptions described below, a guarantee of all
signatures on the written request or on the share certificate or
accompanying stock power, if required, as described under
"Signature Guarantee" below;
(3) any share certificates issued for any of the shares to be
redeemed (see "Certificated Shares" below); and
(4) any additional documents which may be required by the
Transfer Agent for redemption by corporations, partnerships or
other organizations, executors, administrators, trustees,
custodians or guardians, or if the redemption is requested by
anyone other than the shareholder(s) of record. Transfers of
shares are subject to the same requirements.
A signature guarantee is not required for redemptions requested
by and payable to all shareholders of record for the account, and
to be sent to the address of record for that account. To avoid
delay in redemption or transfer, if you have any questions about
these requirements you should contact the Transfer Agent in
writing or call 1-800-426-0107 before submitting a request.
Written redemption or
PIMCO Funds: Multi-Manager Series
45
<PAGE>
transfer requests will not be honored until all required documents
in the proper form have been received by the Transfer Agent. You
can not redeem your shares by written request to the Trust if they
are held in broker "street name" accounts--you must redeem through
your broker.
If the proceeds of your redemption (i) are to be paid to a person
other than the record owner, (ii) are to be sent to an address
other than the address of the account on the Transfer Agent's
records, and/or (iii) are to be paid to a corporation, partnership,
trust or fiduciary, the signature(s) on the redemption request and
on the certificates, if any, or stock power must be guaranteed as
described under "Signature Guarantee" below. The Distributor may,
however, waive the signature guarantee requirement for redemptions
up to $2,500 by a trustee of a qualified retirement plan, the
administrator for which has an agreement with the Distributor.
The Guide describes a number of additional ways you can redeem
your shares, including:
. Telephone requests to the Transfer Agent
. PIMCO Funds Automated Telephone System (ATS)
. Expedited wire transfers
. Automatic Withdrawal Plan
. PIMCO Funds Fund Link
Unless you specifically elect otherwise, your initial account
application permits you to redeem shares by telephone subject to
certain requirements. To be eligible for ATS, expedited wire
transfer, Automatic Withdrawal Plan, and Fund Link privileges, you
must specifically elect the particular option on your account
application and satisfy certain other requirements. The Guide
describes each of these options and provides additional information
about selling shares. You can obtain a Guide free of charge from
the Distributor by written request or by calling 1-800-426-0107.
Other than an applicable CDSC, you will not pay any special fees
or charges to the Trust or the Distributor when you sell your
shares. However, if you sell your shares through your broker,
dealer or other financial intermediary, that firm may charge you a
commission or other fee for processing your redemption request.
Redemptions of Fund shares may be suspended when trading on the
New York Stock Exchange is restricted or during an emergency which
makes it impracticable for the Funds to dispose of their securities
or to determine fairly the value of their net assets, or during any
other period as permitted by the Securities and Exchange Commission
for the protection of investors. Under these and other unusual
circumstances, the Trust may suspend redemptions or postpone
payments for more than seven days, as permitted by law.
Timing of Redemption proceeds will normally be mailed to the redeeming
Redemption shareholder within seven calendar days or, in the case of wire
Payments transfer or Fund Link redemptions, sent to the designated bank
account within one business day. Fund Link redemptions may be
received by the bank on the second or third business day. In cases
where shares have recently been purchased by personal check,
redemption proceeds may be withheld until the check has been
collected, which may take up to 15 days. To avoid such withholding,
investors should purchase shares by certified or bank check or by
wire transfer. Under unusual circumstances, the Trust may delay
your redemption payments for more than seven days, as permitted by
law.
Redemptions The Trust had agreed to redeem shares of each Fund solely in cash
In Kind up to the lesser of $250,000 or 1% of the Fund's net assets during
any 90-day period for any one shareholder. In consideration of the
best interests of the remaining shareholders, the Trust may pay any
redemption proceeds exceeding this amount in whole or in part by a
distribution in kind of securities held by a Fund in lieu of cash.
Except for Funds with a tax-efficient management strategy, it is
highly unlikely that your shares would ever be redeemed in kind. If
your shares are redeemed in kind, you should expect to incur
transaction costs upon the disposition of the securities received
in the distribution.
Certificated If you are redeeming shares for which certificates have been
Shares issued, the certificates must be mailed to or deposited with the
Trust, duly endorsed or accompanied by a duly endorsed stock power
or by a written request for redemption. Signatures must be
guaranteed as described under "Signature Guarantee" below. The
Trust may request further documentation from institutions or
fiduciary accounts, such as corporations, custodians (e.g., under
the Uniform Gifts to Minors Act), executors, administrators,
trustees or guardians. Your redemption request and stock power
must be signed exactly as the account is registered, including
indication of any special capacity of the registered owner.
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46
<PAGE>
Signature When a signature guarantee is called for, you should have
Guarantee "Signature Guaranteed" stamped under your signature and guaranteed
by any of the following entities: U.S. banks, foreign banks having
a U.S. correspondent bank, credit unions, savings associations,
U.S. registered dealers and brokers, municipal securities dealers
and brokers, government securities dealers and brokers, national
securities exchanges, registered securities associations and
clearing agencies (each an "Eligible Guarantor Institution"). The
Distributor reserves the right to reject any signature guarantee
pursuant to its written signature guarantee standards or
procedures, which may be revised in the future to permit it to
reject signature guarantees from Eligible Guarantor Institutions
that do not, based on credit guidelines, satisfy such written
standards or procedures. The Trust may change the signature
guarantee requirements from time to time upon notice to
shareholders, which may be given by means of a new or supplemented
Prospectus.
Fund Distributions
Each Fund distributes substantially all of its net investment
income to shareholders in the form of dividends. You begin earning
dividends on Fund shares the day after the Trust receives your
purchase payment. Dividends paid by each Fund with respect to each
class of shares are calculated in the same manner and at the same
time, but dividends on Class B and Class C shares are expected to
be lower than dividends on Class A shares as a result of the
distribution fees applicable to Class B and Class C shares. The
following shows when each Fund intends to declare and distribute
income dividends to shareholders of record.
<TABLE>
<CAPTION>
Fund At Least Annually Quarterly
-------------------------------------------------------------
<S> <C> <C>
Equity Income, Renaissance and .
Value Funds
-------------------------------------------------------------
All other Funds .
-------------------------------------------------------------
</TABLE>
In addition, each Fund distributes any net capital gains it earns
from the sale of portfolio securities to shareholders no less
frequently than annually. Net short-term capital gains may be paid
more frequently.
You can choose from the following distribution options:
. Reinvest all distributions in additional shares of the same class
of your Fund at NAV. This will be done unless you elect another
option.
. Invest all distributions in shares of the same class of any
other Fund or another series of the Trust or PIMCO Funds:
Pacific Investment Management Series which offers that class at
NAV. You must have an account existing in the Fund or series
selected for investment with the identical registered name. You
must elect this option on your account application or by a
telephone request to the Transfer Agent at 1-800-426-0107.
. Receive all distributions in cash (either paid directly to you
or credited to your account with your broker or other financial
intermediary). You must elect this option on your account
application or by a telephone request to the Transfer Agent at
1-800-426-0107.
You do not pay any sales charges on shares you receive through
the reinvestment of Fund distributions.
If you elect to receive Fund distributions in cash and the postal
or other delivery service is unable to deliver checks to your
address of record, the Trust's Transfer Agent will hold the
returned checks for your benefit in a non-interest bearing
account.
For further information on distribution options, please contact
your broker or call the Distributor at 1-800-426-0107.
Tax Consequences
. Taxes on Fund distributions. If you are subject to U.S. federal
income tax, you will be subject to tax on Fund distributions
whether you received them in cash or reinvested them in
additional shares of the Funds. For federal income tax purposes,
Fund distributions will be taxable to you as either ordinary
income or capital gains.
PIMCO Funds: Multi-Manager Series
47
<PAGE>
Fund dividends (i.e., distributions of investment income) are
taxable to you as ordinary income. Federal taxes on Fund
distributions of gains are determined by how long the Fund owned
the investments that generated the gains, rather than how long you
have owned your shares. Distributions of gains from investments
that a Fund owned for more than 12 months will generally be
taxable to you as capital gains. Distributions of gains from
investments that the Fund owned for 12 months or less will
generally be taxable to you as ordinary income.
Fund distributions are taxable to you even if they are paid from
income or gains earned by a Fund prior to your investment and thus
were included in the price you paid for your shares. For example,
if you purchase shares on or just before the record date of a Fund
distribution, you will pay full price for the shares and may
receive a portion of your investment back as a taxable
distribution.
. Taxes when you sell (redeem) or exchange your shares. Any gain
resulting from the sale of Fund shares will generally be subject
to federal income tax. When you exchange shares of a Fund for
shares of another series, the transaction generally will be
treated as a sale of the Fund shares for these purposes, and any
gain on those shares will generally be subject to federal income
tax.
. A Note on the Tax-Efficient Equity Fund. The Tax-Efficient
Equity Fund utilizes a number of tax-efficient management
techniques designed to minimize taxable distributions. For
instance, the Fund generally seeks to minimize realized gains and,
when realizing gains, attempts to realize gains that will be taxed
as capital gains (i.e., as gains on investments owned for more
than 12 months) when distributed to shareholders. Although the
Fund attempts to minimize taxable distributions, it may be
expected to earn and distribute taxable income and realize and
distribute capital gains from time to time.
. A Note on Foreign Investments. A Fund's investment in foreign
securities may be subject to foreign withholding taxes. In that
case, the Fund's yield on those securities would be decreased. In
addition, a Fund's investments in foreign securities or foreign
currencies may increase or accelerate the Fund's recognition of
ordinary income and may affect the timing or amount of the Fund's
distributions. Shareholders of the Global Innovation and
International Funds may be entitled to claim a credit or deduction
with respect to foreign taxes.
This section relates only to federal income tax consequences of
investing in the Funds; the consequences under other tax laws may
differ. You should consult your tax advisor as to the possible
application of foreign, state and local income tax laws to Fund
dividends and capital distributions. Please see the Statement of
Additional Information for additional information regarding the
tax aspects of investing in the Funds.
Characteristics and Risks of Securities and Investment Techniques
This section provides additional information about some of the
principal investments and related risks of the Funds identified
under "Summary Information" above. It also describes
characteristics and risks of additional securities and investment
techniques that are not necessarily principal investments or
strategies but may be used by the Funds from time to time. Most of
these securities and investment techniques are discretionary,
which means that the portfolio managers can decide whether to use
them or not. This Prospectus does not attempt to disclose all of
the various types of securities and investment techniques that may
be used by the Funds. As with any mutual fund, investors in the
Funds must rely on the professional investment judgment and skill
of PIMCO Advisors, the Sub-Advisers and the individual portfolio
managers. Please see "Investment Objectives and Policies" in the
Statement of Additional Information for more detailed information
about the securities and investment techniques described in this
section and about other strategies and techniques that may be used
by the Funds.
Fixed Fixed income securities are obligations of the issuer to make
Income payments of principal and/or interest on future dates, and include
Securities corporate and government bonds, notes, certificates of deposit,
and commercial paper, convertible securities and mortgage-backed and
Defensive other asset-backed securities.
Strategies
The Capital Appreciation, Mid-Cap and Tax-Efficient Equity Funds
intend to be as fully invested in common stocks as practicable at
all times, although, for cash management purposes, each of these
Funds may maintain a portion of its assets (normally not more than
10%) in U.S. Government securities, high quality fixed income
securities, money market obligations and cash to pay certain Fund
expenses and to meet redemption requests. None of these Funds will
make defensive investments in
Prospectus
48
<PAGE>
response to unfavorable market and other conditions and therefore
may be particularly vulnerable to general declines in stock prices
and/or other categories of securities in which they invest.
Under normal circumstances, the Small-Cap Value Fund intends to
be fully invested in common stocks (aside from cash management
practices), except that the Fund may temporarily hold up to 10% of
its assets in cash and cash equivalents for defensive purposes in
response to unfavorable market and other conditions. The Equity
Income, Global Innovation, Growth, Innovation, International,
Opportunity, Renaissance, Select Growth, Target and Value Funds
will each invest primarily in common stocks, and may also invest
in other kinds of equity securities, including preferred stocks
and securities (including fixed income securities and warrants)
convertible into or exercisable for common stocks. Each of these
Funds may invest a portion of its assets in fixed income
securities. These Funds may temporarily hold up to 100% of their
assets in short-term U.S. Government securities and other money
market instruments for defensive purposes in response to
unfavorable market and other conditions. The International Fund
may also hold up to 100% of its assets in other domestic fixed
income, foreign fixed income and equity securities principally
traded in the U.S., including obligations issued or guaranteed by
a foreign government or its agencies, authorities or
instrumentalities, corporate bonds and American Depository
Receipts, for temporary defensive purposes. The temporary
defensive strategies described in this paragraph would be
inconsistent with the investment objective and principal
investment strategies of each of the noted Funds and may adversely
affect the Fund's ability to achieve its investment objective.
Companies Each of the Funds may invest in securities of companies with
With market capitalizations that are small compared to other publicly
Smaller traded companies. The Opportunity and Small-Cap Value Funds invest
Market primarily in smaller companies and are especially sensitive to the
Capital- risks described below. In addition, the Global Innovation and
izations Innovation Funds generally have substantial exposure to these
risks. The Mid-Cap and Target Funds also have significant exposure
to these risks because they invest primarily in companies with
medium-sized market capitalizations, which are smaller than the
largest companies.
Companies which are smaller and less well-known or seasoned than
larger, more widely held companies may offer greater opportunities
for capital appreciation, but may also involve risks different
from, or greater than, risks normally associated with larger
companies. Larger companies generally have greater financial
resources, more extensive research and development, manufacturing,
marketing and service capabilities, and more stability and greater
depth of management and technical personnel than smaller
companies. Smaller companies may have limited product lines,
markets or financial resources or may depend on a small,
inexperienced management group. Securities of smaller companies
may trade less frequently and in lesser volume than more widely
held securities and their values may fluctuate more abruptly or
erratically than securities of larger companies. They may also
trade in the over-the-counter market or on a regional exchange, or
may otherwise have limited liquidity. These securities may
therefore be more vulnerable to adverse market developments than
securities of larger companies. Also, there may be less publicly
available information about smaller companies or less market
interest in their securities as compared to larger companies, and
it may take longer for the prices of the securities to reflect the
full value of a company's earnings potential or assets.
Because securities of smaller companies may have limited
liquidity, a Fund may have difficulty establishing or closing out
its positions in smaller companies at prevailing market prices. As
a result of owning large positions in this type of security, a
Fund is subject to the additional risk of possibly having to sell
portfolio securities at disadvantageous times and prices if
redemptions require the Fund to liquidate its securities
positions. For these reasons, it may be prudent for a Fund with a
relatively large asset size to limit the number of relatively
small positions it holds in securities having limited liquidity in
order to minimize its exposure to such risks, to minimize
transaction costs, and to maximize the benefits of research. As a
consequence, as a Fund's asset size increases, the Fund may reduce
its exposure to illiquid smaller capitalization securities, which
could adversely affect performance.
The Funds may purchase securities in initial public offerings
(IPOs). These securities are subject to many of the same risks of
investing in companies with smaller market capitalizations.
Securities issued in IPOs have no trading history, and information
about the companies may be available for very limited periods. In
addition, the prices of securities sold in IPOs may be highly
volatile. A Fund may not be able to invest in securities issued in
IPOs to the extent desired because, for example, only a small
portion of the securities being offered in an IPO may be made
available to the Fund or because under certain market conditions
few companies may issue securities in IPOs.
Foreign The International Fund normally invests principally in securities
Securities of foreign issuers, securities traded principally in securities
markets outside the United States and/or securities denominated in
foreign currencies (together, "foreign securities"). The Global
Innovation Fund will invest in the securities of
PIMCO Funds: Multi-Manager Series
49
<PAGE>
issuers located in at least three countries (one of which may be
the United States). The Equity Income, Growth, Innovation,
Opportunity, Renaissance, Select Growth, Target and Value Funds
may invest up to 15% of their respective assets in foreign
securities.
All of the Funds may invest in American Depository Receipts
("ADRs"). In addition, the Equity Income, Global Innovation,
Growth, Innovation, International, Opportunity, Renaissance,
Select Growth, Target and Value Funds may invest in European
Depository Receipts (EDRs) and Global Depository Receipts (GDRs).
ADRs are dollar-denominated receipts issued generally by domestic
banks and representing the deposit with the bank of a security of
a foreign issuer, and are publicly traded on exchanges or over-
the-counter in the United States. EDRs are receipts similar to
ADRs and are issued and traded in Europe. GDRs may be offered
privately in the United States and also traded in public or
private markets in other countries.
Investing in foreign securities involves special risks and
considerations not typically associated with investing in U.S.
securities and shareholders should consider carefully the
substantial risks involved for Funds that invest in these
securities. These risks include: differences in accounting,
auditing and financial reporting standards; generally higher
commission rates on foreign portfolio transactions; the
possibility of nationalization, expropriation or confiscatory
taxation; adverse changes in investment or exchange control
regulations; and political instability. Individual foreign
economies may differ favorably or unfavorably from the U.S.
economy in such respects as growth of gross domestic product, rate
of inflation, capital reinvestment, resources, self-sufficiency
and balance of payments position. The securities markets, values
of securities, yields and risks associated with foreign securities
markets may change independently of each other. Also, foreign
securities and dividends and interest payable on those securities
may be subject to foreign taxes, including taxes withheld from
payments on those securities. Foreign securities often trade with
less frequency and volume than domestic securities and therefore
may exhibit greater price volatility. Investments in foreign
securities may also involve higher custodial costs than domestic
investments and additional transaction costs with respect to
foreign currency conversions. Changes in foreign exchange rates
also will affect the value of securities denominated or quoted in
foreign currencies.
Emerging Each of the Funds that may invest in foreign securities may invest
Market in securities of issuers based in or that trade principally in
Securities countries with developing (or "emerging market") economies. The
Global Innovation and International Funds may invest significant
portions of their assets in emerging market securities. Investing
in emerging market securities imposes risks different from, or
greater than, risks of investing in domestic securities or in
foreign, developed countries. These risks include: smaller market
capitalization of securities markets, which may suffer periods of
relative illiquidity; significant price volatility; restrictions
on foreign investment; and possible repatriation of investment
income and capital. In addition, foreign investors may be required
to register the proceeds of sales, and future economic or
political crises could lead to price controls, forced mergers,
expropriation or confiscatory taxation, seizure, nationalization
or the creation of government monopolies. The currencies of
emerging market countries may experience significant declines
against the U.S. dollar, and devaluation may occur subsequent to
investments in these currencies by a Fund. Inflation and rapid
fluctuations in inflation rates have had, and may continue to
have, negative effects on the economies and securities markets of
certain emerging market countries.
Additional risks of emerging market securities may include:
greater social, economic and political uncertainty and
instability; more substantial governmental involvement in the
economy; less governmental supervision and regulation;
unavailability of currency hedging techniques; companies that are
newly organized and small; differences in auditing and financial
reporting standards, which may result in unavailability of
material information about issuers; and less developed legal
systems. In addition, emerging securities markets may have
different clearance and settlement procedures, which may be unable
to keep pace with the volume of securities transactions or
otherwise make it difficult to engage in such transactions.
Settlement problems may cause a Fund to miss attractive investment
opportunities, hold a portion of its assets in cash pending
investment, or be delayed in disposing of a portfolio security.
Such a delay could result in possible liability to a purchaser of
the security.
Special Risks of Investing in Russian and Other Eastern European
Securities. The Global Innovation and International Funds may
invest a portion of their assets in securities of issuers located
in Russia and in other Eastern European countries. While
investments in securities of such issuers are subject generally to
the same risks associated with investments in other emerging
market countries described above, the political, legal and
operational risks of investing in Russian and other Eastern
European
Prospectus
50
<PAGE>
issuers, and of having assets custodied within these countries,
may be particularly acute. A risk of particular note with respect
to direct investment in Russian securities is the way in which
ownership of shares of companies is normally recorded. When a Fund
invests in a Russian issuer, it will normally receive a "share
extract," but that extract is not legally determinative of
ownership. The official record of ownership of a company's share
is maintained by the company's share registrar. Such share
registrars are completely under the control of the issuer, and
investors are provided with few legal rights against such
registrars.
Foreign A Fund that invests directly in foreign currencies or in
Currencies securities that trade in, and receive revenues in, foreign
currencies will be subject to currency risk. The Global Innovation
and International Funds are particularly sensitive to this risk.
Foreign currency exchange rates may fluctuate significantly over
short periods of time. They generally are determined by supply and
demand and the relative merits of investments in different
countries, actual or perceived changes in interest rates and other
complex factors. Currency exchange rates also can be affected
unpredictably by intervention (or the failure to intervene) by
U.S. or foreign governments or central banks, or by currency
controls or political developments. For example, significant
uncertainty surrounds the recent introduction of the euro (a
common currency unit for the European Union) in January 1999 and
the effect it may have on the value of securities denominated in
local European currencies. These and other currencies in which the
Funds' assets are denominated may be devalued against the U.S.
dollar, resulting in a loss to the Funds.
Foreign Currency Transactions. The Equity Income, Global
Innovation, Growth, Innovation, International, Opportunity,
Renaissance, Select Growth, Target and Value Funds may enter into
forward foreign currency exchange contracts to reduce the risks of
adverse changes in foreign exchange rates. In addition, the Global
Innovation and International Funds may buy and sell foreign
currency futures contracts and options on foreign currencies and
foreign currency futures. A forward foreign currency exchange
contract, which involves an obligation to purchase or sell a
specific currency at a future date at a price set at the time of
the contract, reduces a Fund's exposure to changes in the value of
the currency it will deliver and increases its exposure to changes
in the value of the currency it will receive for the duration of
the contract. The effect on the value of a Fund is similar to
selling securities denominated in one currency and purchasing
securities denominated in another currency. Contracts to sell
foreign currency would limit any potential gain which might be
realized by a Fund if the value of the hedged currency increases.
A Fund may enter into these contracts to hedge against foreign
exchange risk arising from the Fund's investment or anticipated
investment in securities denominated in foreign currencies.
Suitable hedging transactions may not be available in all
circumstances and there can be no assurance that a Fund will
engage in such transactions at any given time or from time to
time. Also, such transactions may not be successful and may
eliminate any chance for a Fund to benefit from favorable
fluctuations in relevant foreign currencies.
The Global Innovation and International Funds may also enter into
these contracts for purposes of increasing exposure to a foreign
currency or to shift exposure to foreign currency fluctuations
from one currency to another. To the extent that it does so, a
Fund will be subject to the additional risk that the relative
value of currencies will be different than anticipated by the
Fund's portfolio manager. The Global Innovation and International
Funds may use one currency (or a basket of currencies) to hedge
against adverse changes in the value of another currency (or a
basket of currencies) when exchange rates between the two
currencies are positively correlated. Each Fund will segregate
assets determined to be liquid by PIMCO Advisors or the Fund's
Sub-Adviser in accordance with procedures established by the Board
of Trustees to cover its obligations under forward foreign
currency exchange contracts entered into for non-hedging purposes.
Convertible Each Fund may invest in convertible securities. Convertible
Securities securities are generally preferred stocks and other securities,
including fixed income securities and warrants, that are
convertible into or exercisable for common stock at either a
stated price or a stated rate. The price of a convertible security
will normally vary in some proportion to changes in the price of
the underlying common stock because of this conversion or exercise
feature. However, the value of a convertible security may not
increase or decrease as rapidly as the underlying common stock. A
convertible security will normally also provide income and is
subject to interest rate risk. While convertible securities
generally offer lower interest or dividend yields than non-
convertible fixed income securities of similar quality, their
value tends to increase as the market value of the underlying
stock increases and to decrease when the value of the underlying
stock decreases. Also, a Fund may be forced to convert a security
before it would otherwise choose, which may have an adverse effect
on the Fund's ability to achieve its investment objective.
PIMCO Funds: Multi-Manager Series
51
<PAGE>
Derivatives Each Fund (except the Capital Appreciation, Mid-Cap and Small-Cap
Value Funds) may, but is not required to, use a number of
derivative instruments for risk management purposes or as part of
its investment strategies. Generally, derivatives are financial
contracts whose value depends upon, or is derived from, the value
of an underlying asset, reference rate or index, and may relate to
stocks, bonds, interest rates, currencies or currency exchange
rates, commodities, and related indexes. A portfolio manager may
decide not to employ any of these strategies and there is no
assurance that any derivatives strategy used by a Fund will
succeed.
Examples of derivative instruments include options contracts,
futures contracts, options on futures contracts and swap
agreements. The Equity Income, Global Innovation, Growth,
Innovation, International, Opportunity, Renaissance, Select
Growth, Target, Tax-Efficient Equity and Value Funds may purchase
and sell (write) call and put options on securities, securities
indexes and foreign currencies. Each of these Funds may purchase
and sell futures contracts and options thereon with respect to
securities, securities indexes and foreign currencies. The Tax-
Efficient Equity Fund may enter into swap agreements with respect
to securities indexes. A description of these and other derivative
instruments that the Funds may use are described under "Investment
Objectives and Policies" in the Statement of Additional
Information.
A Fund's use of derivative instruments involves risks different
from, or greater than, the risks associated with investing
directly in securities and other more traditional investments. A
description of various risks associated with particular derivative
instruments is included in "Investment Objectives and Policies" in
the Statement of Additional Information. The following provides a
more general discussion of important risk factors relating to all
derivative instruments that may be used by the Funds.
Management Risk Derivative products are highly specialized
instruments that require investment techniques and risk analyses
different from those associated with stocks and bonds. The use of
a derivative requires an understanding not only of the underlying
instrument but also of the derivative itself, without the benefit
of observing the performance of the derivative under all possible
market conditions.
Credit Risk The use of a derivative instrument involves the risk
that a loss may be sustained as a result of the failure of another
party to the contract (usually referred to as a "counterparty") to
make required payments or otherwise comply with the contract's
terms.
Liquidity Risk Liquidity risk exists when a particular derivative
instrument is difficult to purchase or sell. If a derivative
transaction is particularly large or if the relevant market is
illiquid (as is the case with many privately negotiated
derivatives), it may not be possible to initiate a transaction or
liquidate a position at an advantageous time or price.
Leveraging Risk Because many derivatives have a leverage
component, adverse changes in the value or level of the underlying
asset, reference rate or index can result in a loss substantially
greater than the amount invested in the derivative itself. Certain
derivatives have the potential for unlimited loss, regardless of
the size of the initial investment. When a Fund uses derivatives
for leverage, investments in that Fund will tend to be more
volatile, resulting in larger gains or losses in response to
market changes. To limit leverage risk, each Fund will segregate
assets determined to be liquid by PIMCO Advisors or a Sub-Adviser
in accordance with procedures established by the Board of Trustees
(or, as permitted by applicable regulation, enter into certain
offsetting positions) to cover its obligations under derivative
instruments.
Lack of Availability Because the markets for certain derivative
instruments (including markets located in foreign countries) are
relatively new and still developing, suitable derivatives
transactions may not be available in all circumstances for risk
management or other purposes. There is no assurance that a Fund
will engage in derivatives transactions at any time or from time
to time. A Fund's ability to use derivatives may also be limited
by certain regulatory and tax considerations.
Market and Other Risks Like most other investments, derivative
instruments are subject to the risk that the market value of the
instrument will change in a way detrimental to a Fund's interest.
If a portfolio manager incorrectly forecasts the values of
securities, currencies or interest rates or other economic factors
in using derivatives for a Fund, the Fund might have been in a
better position if it had not entered into the transaction at all.
While some strategies involving derivative instruments can reduce
the risk of loss, they can also reduce the opportunity for gain or
even result in losses by offsetting favorable price movements in
other Fund investments. A Fund may also have to buy or sell a
security at a disadvantageous time or price because the Fund is
legally required to maintain offsetting positions or asset
coverage in connection with certain derivatives transactions.
Prospectus
52
<PAGE>
Other risks in using derivatives include the risk of mispricing
or improper valuation of derivatives and the inability of
derivatives to correlate perfectly with underlying assets, rates
and indexes. Many derivatives, in particular privately negotiated
derivatives, are complex and often valued subjectively. Improper
valuations can result in increased cash payment requirements to
counterparties or a loss of value to a Fund. Also, the value of
derivatives may not correlate perfectly, or at all, with the value
of the assets, reference rates or indexes they are designed to
closely track. In addition, a Fund's use of derivatives may cause
the Fund to realize higher amounts of short-term capital gains
(taxed at ordinary income tax rates when distributed to
shareholders who are individuals) than if the Fund had not used
such instruments.
Equity- The International Fund may invest up to 5% of its assets in
Linked equity-linked securities. Equity-linked securities are privately
Securities issued securities whose investment results are designed to
correspond generally to the performance of a specified stock index
or "basket" of stocks, or sometimes a single stock. To the extent
that the Fund invests in equity-linked securities whose return
corresponds to the performance of a foreign securities index or
one or more of foreign stocks, investing in equity-linked
securities will involve risks similar to the risks of investing in
foreign equity securities. See "Foreign Securities" above. In
addition, the Fund bears the risk that the issuer of an equity-
linked security may default on its obligations under the security.
Equity-linked securities may be considered illiquid and thus
subject to the Fund's restrictions on investments in illiquid
securities.
Credit The Funds may invest in securities based on their credit ratings
Ratings assigned by rating agencies such as Moody's Investors Service,
and Inc. ("Moody's") and Standard and Poor's Ratings Services ("S&P").
Unrated Moody's, S&P and other rating agencies are private services that
Securities provide ratings of the credit quality of fixed income securities,
including convertible securities. The Appendix to the Statement of
Additional Information describes the various ratings assigned to
fixed income securities by Moody's and S&P. Ratings assigned by a
rating agency are not absolute standards of credit quality and do
not evaluate market risk. Rating agencies may fail to make timely
changes in credit ratings and an issuer's current financial
condition may be better or worse than a rating indicates. A Fund
will not necessarily sell a security when its rating is reduced
below its rating at the time of purchase. PIMCO Advisors and the
Sub-Advisers do not rely solely on credit ratings, and develop
their own analysis of issuer credit quality.
A Fund may purchase unrated securities (which are not rated by a
rating agency) if its portfolio manager determines that the
security is of comparable quality to a rated security that the
Fund may purchase. Unrated securities may be less liquid than
comparable rated securities and involve the risk that the
portfolio manager may not accurately evaluate the security's
comparative credit rating.
Loans of For the purpose of achieving income, each Fund may lend its
Portfolio portfolio securities to brokers, dealers, and other financial
Securities institutions provided a number of conditions are satisfied,
including that the loan is fully collateralized. Please see
"Investment Objectives and Policies" in the Statement of
Additional Information for details. When a Fund lends portfolio
securities, its investment performance will continue to reflect
changes in the value of the securities loaned, and the Fund will
also receive a fee or interest on the collateral. Securities
lending involves the risk of loss of rights in the collateral or
delay in recovery of the collateral if the borrower fails to
return the security loaned or becomes insolvent. A Fund may pay
lending fees to the party arranging the loan.
Short Each Fund may make short sales as part of its overall portfolio
Sales management strategies or to offset a potential decline in the
value of a security. A short sale involves the sale of a security
that is borrowed from a broker or other institution to complete
the sale. A Fund may only enter into short selling transactions if
the security sold short is held in the Fund's portfolio or if the
Fund has the right to acquire the security without the payment of
further consideration. For these purposes, a Fund may also hold or
have the right to acquire securities which, without the payment of
any further consideration, are convertible into or exchangeable
for the securities sold short. Short sales expose a Fund to the
risk that it will be required to acquire, convert or exchange
securities to replace the borrowed securities (also known as
"covering" the short position) at a time when the securities sold
short have appreciated in value, thus resulting in a loss to the
Fund.
When- Each Fund may purchase securities which it is eligible to purchase
Issued, on a when-issued basis, may purchase and sell such securities for
Delayed delayed delivery and may make contracts to purchase such
Delivery securities for a fixed price at a future date beyond normal
and settlement time (forward commitments). When-issued transactions,
Forward delayed delivery purchases and forward commitments involve a risk
Commitment of loss if the value of the securities declines prior to the
Trans- settlement date. This risk is in addition to the risk that the
actions Fund's
PIMCO Funds: Multi-Manager Series
53
<PAGE>
other assets will decline in value. Therefore, these transactions
may result in a form of leverage and increase a Fund's overall
investment exposure. Typically, no income accrues on securities a
Fund has committed to purchase prior to the time delivery of the
securities is made, although a Fund may earn income on securities
it has segregated to cover these positions.
Repurchase Each Fund may enter into repurchase agreements, in which the Fund
Agreements purchases a security from a bank or broker-dealer that agrees to
repurchase the security at the Fund's cost plus interest within a
specified time. If the party agreeing to repurchase should
default, the Fund will seek to sell the securities which it holds.
This could involve procedural costs or delays in addition to a
loss on the securities if their value should fall below their
repurchase price. Those Funds whose investment objectives do not
include the earning of income will invest in repurchase agreements
only as a cash management technique with respect to that portion
of its portfolio maintained in cash. Repurchase agreements
maturing in more than seven days are considered illiquid
securities.
Reverse Each Fund may enter into reverse repurchase agreements, subject to
Repurchase the Fund's limitations on borrowings. A reverse repurchase
Agreements agreement involves the sale of a security by a Fund and its
And Other agreement to repurchase the instrument at a specified time and
Borrowings price, and may be considered a form of borrowing for some
purposes. A Fund will segregate assets determined to be liquid by
PIMCO Advisors or a Sub-Adviser in accordance with procedures
established by the Board of Trustees to cover its obligations
under reverse repurchase agreements. A Fund also may borrow money
for investment purposes subject to any policies of the Fund
currently described in this Prospectus or in the Statement of
Additional Information. Reverse repurchase agreements and other
forms of borrowings may create leveraging risk for a Fund.
Illiquid Each Fund may invest in securities that are illiquid so long as
Securities not more than 15% of the value of the Fund's net assets (taken at
market value at the time of investment) would be invested in such
securities. Certain illiquid securities may require pricing at
fair value as determined in good faith under the supervision of
the Board of Trustees. A portfolio manager may be subject to
significant delays in disposing of illiquid securities held by a
Fund, and transactions in illiquid securities may entail
registration expenses and other transaction costs that are higher
than those for transactions in liquid securities. The term
"illiquid securities" for this purpose means securities that
cannot be disposed of within seven days in the ordinary course of
business at approximately the amount at which a Fund has valued
the securities. Please see "Investment Objectives and Policies" in
the Statement of Additional Information for a listing of various
securities that are generally considered to be illiquid for these
purposes. Restricted securities, i.e., securities subject to legal
or contractual restrictions on resale, may be illiquid. However,
some restricted securities (such as securities issued pursuant to
Rule 144A under the Securities Act of 1933 and certain commercial
paper) may be treated as liquid, although they may be less liquid
than registered securities traded on established secondary
markets.
Investment The International Fund may invest up to 10% of its assets in
in Other securities of other investment companies, such as closed-end
Investment management investment companies, or in pooled accounts or other
Companies investment vehicles which invest in foreign markets. Each of the
other Funds may invest up to 5% of its assets in other investment
companies. As a shareholder of an investment company, a Fund may
indirectly bear service and other fees which are in addition to
the fees the Fund pays its service providers.
Portfolio With the exception of the Tax-Efficient Equity Fund, the length of
Turnover time a Fund has held a particular security is not generally a
consideration in investment decisions. A change in the securities
held by a Fund is known as "portfolio turnover." Each Fund may
engage in active and frequent trading of portfolio securities to
achieve its investment objective and principal investment
strategies, particularly during periods of volatile market
movements, although the Tax-Efficient Equity Fund will generally
attempt to limit portfolio turnover as part of its tax-efficient
management strategies. High portfolio turnover (e.g., over 100%)
involves correspondingly greater expenses to a Fund, including
brokerage commissions or dealer mark-ups and other transaction
costs on the sale of securities and reinvestments in other
securities. Such sales may also result in realization of taxable
capital gains, including short-term capital gains (which are taxed
at ordinary income tax rates when distributed to shareholders who
are individuals). The trading costs and tax effects associated
with portfolio turnover may adversely affect a Fund's performance.
Changes The investment objective of each of the Global Innovation, Growth,
in Innovation, International, Opportunity, Renaissance, Select
Investment Growth, Target and Tax-Efficient Equity 25 Funds described in this
Objectives Prospectus may be changed by the Board of Trustees without
and shareholder approval. The investment objective of each other Fund
Policies is fundamental and may not be changed without shareholder
approval. Unless otherwise stated in the Statement of Additional
Information, all investment policies of the
Prospectus
54
<PAGE>
Funds may be changed by the Board of Trustees without shareholder
approval. If there is a change in a Fund's investment objective or
policies, including a change approved by shareholder vote,
shareholders should consider whether the Fund remains an
appropriate investment in light of their then current financial
position and needs.
New Funds In addition to the risks described under "Summary of Principal
Risks" above and in this section, the Global Innovation Fund is
newly formed and therefore has no history upon which investors can
evaluate its likely performance. Accordingly, there can be no
assurance that the Fund will achieve its investment objective.
Also, it is possible that the Fund may invest in securities
offered in initial public offerings and other similar transactions
which, because of the Fund's size, have a disproportionate impact
on the Fund's performance results. The Fund would not necessarily
have achieved the same performance results if its aggregate net
assets had been greater.
Percentage Unless otherwise stated, all percentage limitations on Fund
Investment investments listed in this Prospectus will apply at the time of
Limitations investment. A Fund would not violate these limitations unless an
excess or deficiency occurs or exists immediately after and as a
result of an investment.
Other The Funds may invest in other types of securities and use a
Investments variety of investment techniques and strategies which are not
and described in this Prospectus. These securities and techniques may
Techniques subject the Funds to additional risks. Please see the Statement of
Additional Information for additional information about the
securities and investment techniques described in this Prospectus
and about additional securities and techniques that may be used by
the Funds.
PIMCO Funds: Multi-Manager Series
55
<PAGE>
(This page left blank intentionally)
Prospectus
56
<PAGE>
Financial Highlights
The financial highlights table is intended to help you understand
the financial performance of Class A, Class B and Class C shares
of each Fund for the past 5 years or, if the class is less than 5
years old, since the class of shares was first offered. Certain
information reflects financial results for a single Fund share.
The total returns in the table represent the rate that an investor
would have earned or lost on an investment in a particular class
of shares of a Fund, assuming reinvestment of all dividends and
distributions. Except as provided in the next sentence, this
information has been audited by PricewaterhouseCoopers LLP, whose
report, along with each Fund's financial statements, are included
in the Trust's annual report to shareholders. The information for
the Target Fund for the period ended December 31, 1999 is included
in the Trust's semi-annual report to shareholders, and is
unaudited. The annual report and semi-annual report are
incorporated by reference in the Statement of Additional
Information and are available free of charge upon request from the
Distributor.
The information provided for each of the Growth, Innovation,
International, Opportunity, Renaissance and Target Funds reflects
the operational history of a corresponding series of PIMCO
Advisors Funds which reorganized as a series of the Trust on
January 17, 1997. In connection with the reorganizations, these
Funds changed their fiscal year ends from September 30 to June 30.
The expense ratios provided for these Funds for periods prior to
January 17, 1997 reflect fee arrangements of PIMCO Advisors Funds
previously in effect which differ from the current fee
arrangements of the Trust. The Global Innovation and Select Growth
Funds did not offer Class A, B or C shares during the periods
ended June 30, 1999.
<TABLE>
<CAPTION>
Year or Net Realized/ Dividends Dividends in Distributions
Period Net Asset Value Net Unrealized Total Income From Net Excess of Net From Net
Ended Beginning Investment Gain (Loss) on From Investment Investment Investment Realized Capital
of Period Income (Loss) Investments Operations Income Income Gains
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Capital Appreci-
ation Fund
Class A
06/30/99 $26.01 $0.06 (a) $2.33 (a) $2.39 $(0.10) $0.00 $(1.65)
06/30/98 21.16 0.07 (a) 6.55 (a) 6.62 (0.09) 0.00 (1.68)
01/20/97-
06/30/97 19.31 0.09 1.76 1.85 0.00 0.00 0.00
Class B
06/30/99 25.75 (0.13)(a) 2.32 (a) 2.19 0.00 0.00 (1.65)
06/30/98 21.10 (0.11)(a) 6.51 (a) 6.40 (0.07) 0.00 (1.68)
01/20/97-
06/30/97 19.31 0.01 1.78 1.79 0.00 0.00 0.00
Class C
06/30/99 25.78 (0.13)(a) 2.31 (a) 2.18 0.00 0.00 (1.65)
06/30/98 21.10 (0.12)(a) 6.53 (a) 6.41 (0.05) 0.00 (1.68)
01/20/97-
06/30/97 19.31 0.02 1.77 1.79 0.00 0.00 0.00
<CAPTION>
Year or Distributions
Period in Excess of
Ended Net Realized
Capital Gains
- -------------------------------------------------------------------------------------------------------------------------
<S> <C>
Capital Appreci-
ation Fund
Class A
06/30/99 $0.00
06/30/98 0.00
01/20/97-
06/30/97 0.00
Class B
06/30/99 0.00
06/30/98 0.00
01/20/97-
06/30/97 0.00
Class C
06/30/99 0.00
06/30/98 0.00
01/20/97-
06/30/97 0.00
Equity Income
Fund (i)
Class A
06/30/99 $16.04 $0.39 (a) $1.29 (a) $1.68 $(0.38) $0.00 $(1.76)
06/30/98 15.39 0.39 (a) 2.73 (a) 3.12 (0.38) 0.00 (2.09)
01/20/97-
06/30/97 13.94 0.15 1.48 1.63 (0.18) 0.00 0.00
Class B
06/30/99 15.99 0.28 (a) 1.27 (a) 1.55 (0.28) 0.00 (1.76)
06/30/98 15.37 0.26 (a) 2.73 (a) 2.99 (0.28) 0.00 (2.09)
01/20/97-
06/30/97 13.94 0.11 1.48 1.59 (0.16) 0.00 0.00
Class C
06/30/99 16.01 0.27 (a) 1.27 (a) 1.54 (0.27) 0.00 (1.76)
06/30/98 15.37 0.26 (a) 2.74 (a) 3.00 (0.27) 0.00 (2.09)
01/20/97-
06/30/97 13.94 0.11 1.48 1.59 (0.16) 0.00 0.00
Equity Income
Fund (i)
Class A
06/30/99 $0.00
06/30/98 0.00
01/20/97-
06/30/97 0.00
Class B
06/30/99 0.00
06/30/98 0.00
01/20/97-
06/30/97 0.00
Class C
06/30/99 0.00
06/30/98 0.00
01/20/97-
06/30/97 0.00
Growth Fund (ii)
Class A
06/30/99 $32.62 $(0.14)(a) $5.56 (a) $5.42 $0.00 $0.00 $(3.92)
06/30/98 27.03 (0.08)(a) 9.99 (a) 9.91 0.00 0.00 (4.32)
10/01/96-
06/30/97 26.58 0.69 3.27 3.96 0.00 0.00 (3.51)
09/30/96 25.73 0.06 3.72 3.78 0.00 0.00 (2.93)
09/30/95 22.01 0.12 4.79 4.91 0.00 0.00 (1.19)
09/30/94 23.64 0.12 0.12 0.24 0.00 0.00 (1.87)
Class B
06/30/99 30.34 (0.35)(a) 5.08 (a) 4.73 0.00 0.00 (3.92)
06/30/98 25.59 (0.28)(a) 9.35 (a) 9.07 0.00 0.00 (4.32)
10/01/96-
06/30/97 25.46 0.35 3.29 3.64 0.00 0.00 (3.51)
09/30/96 24.94 (0.07) 3.52 3.45 0.00 0.00 (2.93)
05/23/95-
09/30/95 22.63 (0.03) 2.34 2.31 0.00 0.00 0.00
Growth Fund (ii)
Class A
06/30/99 $0.00
06/30/98 0.00
10/01/96-
06/30/97 0.00
09/30/96 0.00
09/30/95 0.00
09/30/94 0.00
Class B
06/30/99 0.00
06/30/98 0.00
10/01/96-
06/30/97 0.00
09/30/96 0.00
05/23/95-
09/30/95 0.00
</TABLE>
- -------
* Annualized
(a) Per share amounts based upon average number of shares outstanding during
the period.
(i) The information provided for the Equity Income Fund reflects the results
of operations under NFJ Investment Group ("NFJ") as the Fund's Sub-
Adviser. NFJ is expected to be replaced by the PIMCO Equity Advisors
division of PIMCO Advisors ("PIMCO Equity Advisors") as the Sub-Adviser to
the Fund on or about May 8, 2000. The Fund would not necessarily have
achieved the results shown had PIMCO Equity Advisors been the Fund's Sub-
Adviser during the periods shown.
(ii) The information provided for the Growth Fund reflects results of
operations under the Fund's former Sub-Adviser through March 6, 1999; the
Fund would not necessarily have achieved the performance results shown
above under its current investment management arrangements.
PIMCO Funds: Multi-Manager Series
57
<PAGE>
<TABLE>
<CAPTION>
Ratio of Net
Ratio of Investment
Tax Basis Net Asset Expenses to Income (Loss) to
Return of Total Value End of Net Assets End Average Net Average Net Portfolio
Capital Distributions Period Total Return of Period (000s) Assets Assets Turnover Rate
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$0.00 $(1.75) $26.65 10.14% $91,296 1.10% 0.24% 120%
0.00 (1.77) 26.01 32.39 72,803 1.10 0.27 75
0.00 0.00 21.16 9.58 6,534 1.11* 0.59* 87
0.00 (1.65) 26.29 9.39 55,094 1.85 (0.52) 120
0.00 (1.75) 25.75 31.39 40,901 1.85 (0.47) 75
0.00 0.00 21.10 9.27 3,022 1.85* (0.26)* 87
0.00 (1.65) 26.31 9.34 81,097 1.85 (0.52) 120
0.00 (1.73) 25.78 31.40 71,481 1.85 (0.49) 75
0.00 0.00 21.10 9.27 13,093 1.86* (0.23)* 87
$0.00 $(2.14) $15.58 12.26% $17,342 1.10% 2.64% 76%
0.00 (2.47) 16.04 21.35 12,954 1.11 2.39 45
0.00 (0.18) 15.39 11.77 1,756 1.13* 2.85* 45
0.00 (2.04) 15.50 11.35 21,732 1.85 1.89 76
0.00 (2.37) 15.99 20.47 15,178 1.85 1.63 45
0.00 (0.16) 15.37 11.45 2,561 1.87* 2.11* 45
0.00 (2.03) 15.52 11.28 26,016 1.85 1.86 76
0.00 (2.36) 16.01 20.51 23,122 1.85 1.60 45
0.00 (0.16) 15.37 11.42 6,624 1.87* 2.15* 45
$0.00 $(3.92) $34.12 18.65% $227,638 1.16% (0.44)% 131%
0.00 (4.32) 32.62 41.03 180,119 1.16 (0.27) 123
0.00 (3.51) 27.03 15.93 147,276 1.11* 0.13* 94
0.00 (2.93) 26.58 16.11 151,103 1.11 0.24 104
0.00 (1.19) 25.73 23.70 134,819 1.10 0.50 111
0.00 (1.87) 22.01 1.30 107,269 1.10 0.60 115
0.00 (3.92) 31.15 17.72 133,850 1.90 (1.19) 131
0.00 (4.32) 30.34 39.97 80,719 1.91 (1.02) 123
0.00 (3.51) 25.59 15.32 55,626 1.86* (0.62)* 94
0.00 (2.93) 25.46 15.22 37,256 1.86 (0.51) 104
0.00 0.00 24.94 10.20 7,671 1.90* (0.40)* 111
</TABLE>
Prospectus
58
<PAGE>
Financial Highlights (continued)
<TABLE>
<CAPTION>
Year or Net Realized/ Dividends Dividends in Distributions
Period Net Asset Value Net Unrealized Total Income From Net Excess of Net From Net
Ended Beginning Investment Gain (Loss) on From Investment Investment Investment Realized Capital
of Period Income (Loss) Investments Operations Income Income Gains
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Growth Fund
(Cont.)
Class C
06/30/99 $30.33 $(0.35)(a) $5.09 (a) $4.74 $0.00 $0.00 $(3.92)
06/30/98 25.58 (0.28)(a) 9.35 (a) 9.07 0.00 0.00 (4.32)
10/01/96-
06/30/97 25.46 0.45 3.18 3.63 0.00 0.00 (3.51)
09/30/96 24.94 (0.12) 3.57 3.45 0.00 0.00 (2.93)
09/30/95 21.52 (0.04) 4.65 4.61 0.00 0.00 (1.19)
09/30/94 23.32 (0.04) 0.11 0.07 0.00 0.00 (1.87)
<CAPTION>
Year or Distributions
Period in Excess of
Ended Net Realized
Capital Gains
- -------------------------------------------------------------------------------------------------------------------------
<S> <C>
Growth Fund
(Cont.)
Class C
06/30/99 $0.00
06/30/98 0.00
10/01/96-
06/30/97 0.00
09/30/96 0.00
09/30/95 0.00
09/30/94 0.00
Innovation Fund
(iii)
Class A
06/30/99 $24.28 $(0.28)(a) $14.72 (a) $14.44 $0.00 $0.00 $(1.26)
06/30/98 17.43 (0.19)(a) 8.21 (a) 8.02 0.00 0.00 (0.99)
10/01/96-
06/30/97 17.26 0.07 0.36 0.43 0.00 0.00 (0.26)
9/30/96 14.74 (0.07) 2.94 2.87 0.00 0.00 (0.35)
12/22/94-
9/30/95 10.00 (0.06) 4.80 4.74 0.00 0.00 0.00
Class B
06/30/99 23.60 (0.49)(a) 14.24 (a) 13.75 0.00 0.00 (1.26)
06/30/98 17.10 (0.33)(a) 8.00 (a) 7.67 0.00 0.00 (0.99)
10/01/96-
06/30/97 17.04 (0.03) 0.35 0.32 0.00 0.00 (0.26)
9/30/96 14.66 (0.11) 2.84 2.73 0.00 0.00 (0.35)
5/22/95-
9/30/95 11.81 (0.08) 2.93 2.85 0.00 0.00 0.00
Class C
06/30/99 23.59 (0.48)(a) 14.23 (a) 13.75 0.00 0.00 (1.26)
06/30/98 17.09 (0.33)(a) 8.00 (a) 7.67 0.00 0.00 (0.99)
10/01/96-
06/30/97 17.04 (0.02) 0.33 0.31 0.00 0.00 (0.26)
9/30/96 14.65 (0.15) 2.89 2.74 0.00 0.00 (0.35)
12/22/94-
9/30/95 10.00 (0.13) 4.78 4.65 0.00 0.00 0.00
Innovation Fund
(iii)
Class A
06/30/99 $0.00
06/30/98 (0.18)
10/01/96-
06/30/97 0.00
9/30/96 0.00
12/22/94-
9/30/95 0.00
Class B
06/30/99 0.00
06/30/98 (0.18)
10/01/96-
06/30/97 0.00
9/30/96 0.00
5/22/95-
9/30/95 0.00
Class C
06/30/99 0.00
06/30/98 (0.18)
10/01/96-
06/30/97 0.00
9/30/96 0.00
12/22/94-
9/30/95 0.00
International
Fund (iv)
Class A
06/30/99 $14.33 $0.01 (a) $(0.74)(a) $(0.73) $0.00 $0.00 $(1.15)
06/30/98 14.26 0.06 (a) 1.13 (a) 1.19 0.00 0.00 (0.82)
10/01/96-
06/30/97 13.03 0.29 1.33 1.62 0.00 0.00 (0.39)
9/30/96 12.19 0.07 0.77 0.84 0.00 0.00 0.00
9/30/95 12.92 0.07 (0.56) (0.49) 0.00 0.00 (0.24)
9/30/94 12.17 0.04 0.94 0.98 0.00 0.00 (0.23)
Class B
06/30/99 13.46 (0.08)(a) (0.72)(a) (0.80) 0.00 0.00 (1.15)
06/30/98 13.56 (0.05)(a) 1.07 (a) 1.02 0.00 0.00 (0.82)
10/01/96-
06/30/97 12.48 0.16 1.31 1.47 0.00 0.00 (0.39)
9/30/96 11.75 0.00 (a) 0.73 (a) 0.73 0.00 0.00 0.00
5/22/95-
9/30/95 11.30 0.00 0.45 0.45 0.00 0.00 0.00
Class C
06/30/99 13.45 (0.09)(a) (0.71)(a) (0.80) 0.00 0.00 (1.15)
06/30/98 13.55 (0.06)(a) 1.08 (a) 1.02 0.00 0.00 (0.82)
10/01/96-
06/30/97 12.47 0.18 1.29 1.47 0.00 0.00 (0.39)
9/30/96 11.75 (0.05) 0.77 0.72 0.00 0.00 0.00
9/30/95 12.56 (0.02) (0.55) (0.57) 0.00 0.00 (0.24)
9/30/94 11.92 (0.06) 0.93 0.87 0.00 0.00 (0.23)
International
Fund (iv)
Class A
06/30/99 $0.00
06/30/98 (0.30)
10/01/96-
06/30/97 0.00
9/30/96 0.00
9/30/95 0.00
9/30/94 0.00
Class B
06/30/99 0.00
06/30/98 (0.30)
10/01/96-
06/30/97 0.00
9/30/96 0.00
5/22/95-
9/30/95 0.00
Class C
06/30/99 0.00
06/30/98 (0.30)
10/01/96-
06/30/97 0.00
9/30/96 0.00
9/30/95 0.00
9/30/94 0.00
Mid-Cap Fund (v)
Class A
06/30/99 $24.00 $0.03 (a) $(0.13)(a) $(0.10) $(0.01) $0.00 $(1.07)
06/30/98 20.24 0.02 (a) 5.11 (a) 5.13 (0.04) 0.00 (1.33)
01/13/97-
06/30/97 18.14 (0.04) 2.14 2.10 0.00 0.00 0.00
Class B
06/30/99 23.77 (0.13)(a) (0.14)(a) (0.27) 0.00 0.00 (1.07)
06/30/98 20.17 (0.16)(a) 5.09 (a) 4.93 0.00 0.00 (1.33)
01/13/97-
06/30/97 18.14 (0.11) 2.14 2.03 0.00 0.00 0.00
Mid-Cap Fund (v)
Class A
06/30/99 $0.00
06/30/98 0.00
01/13/97-
06/30/97 0.00
Class B
06/30/99 0.00
06/30/98 0.00
01/13/97-
06/30/97 0.00
</TABLE>
- -------
* Annualized
(a) Per share amounts based upon average number of shares outstanding during
the period.
(b) Ratio of expenses to average net assets excluding interest expense is
1.45%.
(c) Ratio of expenses to average net assets excluding interest expense is
2.20%.
(d) Ratio of expenses to average net assets excluding interest expense is
2.20%.
(iii) The information provided for the Innovation Fund reflects results of
operations under the Fund's former Sub-Adviser through March 6, 1999;
the Fund would not necessarily have achieved the performance results
shown above under its current investment management arrangements.
(iv) The information provided for the International Fund reflects results of
operations under the Fund's former Sub-Advisers through November 15,
1994; the Fund would not necessarily have achieved the performance
results shown above under its current investment management
arrangements.
(v) Formerly the Mid-Cap Growth Fund.
PIMCO Funds: Multi-Manager Series
59
<PAGE>
<TABLE>
<CAPTION>
Ratio of Net
Ratio of Investment
Tax Basis Net Asset Expenses to Income (Loss) to
Return of Total Value End of Net Assets End Average Net Average Net Portfolio
Capital Distributions Period Total Return of Period (000s) Assets Assets Turnover Rate
- ------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$ 0.00 $(3.92) $31.15 17.76 % $2,064,450 1.90% (1.18)% 131%
0.00 (4.32) 30.33 39.99 1,853,002 1.91 (1.02) 123
0.00 (3.51) 25.58 15.27 1,514,432 1.86* (0.61)* 94
0.00 (2.93) 25.46 15.22 1,450,216 1.86 (0.51) 104
0.00 (1.19) 24.94 22.80 1,290,152 1.90 (0.20) 111
0.00 (1.87) 21.52 0.50 1,085,427 1.90 (0.20) 115
$0.00 $(1.26) $37.46 61.36 % $313,946 1.30% (0.90)% 119%
0.00 (1.17) 24.28 48.10 85,800 1.31 (0.94) 100
0.00 (0.26) 17.43 2.41 56,215 1.28* (0.68)* 80
0.00 (0.35) 17.26 19.86 50,067 1.31 (0.61) 123
0.00 0.00 14.74 47.40 28,239 1.40* (0.60)* 86
0.00 (1.26) 36.09 60.17 351,876 2.05 (1.64) 119
0.00 (1.17) 23.60 46.95 81,130 2.06 (1.69) 100
0.00 (0.26) 17.10 1.79 51,472 2.03* (1.43)* 80
0.00 (0.35) 17.04 18.99 33,778 2.06 (1.36) 123
0.00 0.00 14.66 24.10 6,509 2.30* (1.70)* 86
0.00 (1.26) 36.08 60.20 580,251 2.05 (1.65) 119
0.00 (1.17) 23.59 46.97 219,258 2.06 (1.69) 100
0.00 (0.26) 17.09 1.73 162,889 2.03* (1.43)* 80
0.00 (0.35) 17.04 19.08 137,752 2.06 (1.36) 123
0.00 0.00 14.65 46.50 63,952 2.20* (1.40)* 86
$0.00 $(1.15) $12.45 (4.31)% $18,865 1.55%(b) 0.05% 55%
0.00 (1.12) 14.33 9.95 12,510 1.48 0.41 60
0.00 (0.39) 14.26 12.82 18,287 1.51* 0.58* 59
0.00 0.00 13.03 6.89 20,056 1.41 0.49 110
0.00 (0.24) 12.19 (3.70) 17,951 1.50 0.60 170
0.00 (0.23) 12.92 8.20 23,289 1.40 0.30 55
0.00 (1.15) 11.51 (5.15) 9,478 2.29 (c) (0.67) 55
0.00 (1.12) 13.46 9.17 8,956 2.22 (0.37) 60
0.00 (0.39) 13.56 12.17 8,676 2.26* 0.18* 59
0.00 0.00 12.48 6.21 5,893 2.16 (0.26) 110
0.00 0.00 11.75 4.00 503 2.30* (0.10)* 170
0.00 (1.15) 11.50 (5.15) 101.320 2.30 (d) (0.75) 55
0.00 (1.12) 13.45 9.18 132,986 2.22 (0.43) 60
0.00 (0.39) 13.55 12.18 168,446 2.25* (0.25)* 59
0.00 0.00 12.47 6.13 203,544 2.16 (0.26) 110
0.00 (0.24) 11.75 (4.50) 215,349 2.20 (0.20) 170
0.00 (0.23) 12.56 7.40 294,492 2.20 (0.50) 55
$0.00 $(1.08) $22.82 (0.13)% $124,680 1.10% 0.15% 85%
0.00 (1.37) 24.00 25.71 57,164 1.11 0.07 66
0.00 0.00 20.24 11.58 12,184 1.11* 0.17* 82
0.00 (1.07) 22.43 (0.86) 84,698 1.85 (0.62) 85
0.00 (1.33) 23.77 24.76 84,535 1.86 (0.68) 66
0.00 0.00 20.17 11.19 28,259 1.85* (0.58)* 82
</TABLE>
Prospectus
60
<PAGE>
Financial Highlights (continued)
<TABLE>
<CAPTION>
Year or Net Realized/ Dividends Dividends in Distributions
Period Net Asset Value Net Unrealized Total Income From Net Excess of Net From Net
Ended Beginning Investment Gain (Loss) on From Investment Investment Investment Realized Capital
of Period Income (Loss) Investments Operations Income Income Gains
- -------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Year or Distributions
Period in Excess of
Ended Net Realized
Capital Gains
- -------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Mid-Cap Fund
(Cont.)
Class C
06/30/99 $23.77 $(0.13)(a) $(0.13)(a) $(0.26) $0.00 $0.00 $(1.07)
06/30/98 20.18 (0.16)(a) 5.08 (a) 4.92 0.00 0.00 (1.33)
01/13/97-
06/30/97 18.14 (0.10) 2.14 2.04 0.00 0.00 0.00
<S> <C>
Mid-Cap Fund
(Cont.)
Class C
06/30/99 $0.00
06/30/98 0.00
01/13/97-
06/30/97 0.00
Opportunity Fund
(vi)
Class A
06/30/99 $31.33 $(0.21)(a) $0.46 (a) $0.25 $0.00 $0.00 $(4.62)
06/30/98 29.35 (0.27)(a) 4.19 (a) 3.92 0.00 0.00 (1.94)
10/01/96-
06/30/97 37.36 0.00 (3.10) (3.10) 0.00 0.00 (4.91)
09/30/96 39.08 (0.11) 6.12 6.01 0.00 0.00 (7.73)
09/30/95 28.87 (0.11) 11.19 11.08 0.00 0.00 (0.87)
09/30/94 33.43 (0.17) (2.02) (2.19) 0.00 0.00 (2.26)
Class B
03/31/99-
06/30/99 21.40 (0.09)(a) 2.89 (a) 2.80 0.00 0.00 0.00
Class C
06/30/99 28.86 (0.37)(a) 0.32 (a) (0.05) 0.00 0.00 (4.62)
06/30/98 27.38 (0.46)(a) 3.88 (a) 3.42 0.00 0.00 (1.94)
10/01/96-
06/30/97 35.38 (0.04) (3.05) (3.09) 0.00 0.00 (4.91)
09/30/96 37.64 (0.35) 5.82 5.47 0.00 0.00 (7.73)
09/30/95 28.04 (0.34) 10.81 10.47 0.00 0.00 (0.87)
09/30/94 32.77 (0.38) (1.98) (2.36) 0.00 0.00 (2.26)
Opportunity Fund
(vi)
Class A
06/30/99 $0.00
06/30/98 0.00
10/01/96-
06/30/97 0.00
09/30/96 0.00
09/30/95 0.00
09/30/94 0.00
Class B
03/31/99-
06/30/99 0.00
Class C
06/30/99 0.00
06/30/98 0.00
10/01/96-
06/30/97 0.00
09/30/96 0.00
09/30/95 0.00
09/30/94 0.00
Renaissance Fund
(vii)
Class A
06/30/99 $19.10 $(0.01)(a) $ 1.45 (a) $1.44 $0.00 $0.00 $(2.33)
06/30/98 17.73 0.07 (a) 4.91 (a) 4.98 (0.08) 0.00 (3.53)
10/01/96-
06/30/97 16.08 0.12 (a) 3.90 (a) 4.02 (0.12) 0.00 (2.25)
09/30/96 14.14 0.23 2.79 3.02 (0.23) (0.07) (0.78)
09/30/95 12.50 0.36 1.61 1.97 (0.33) 0.00 0.00
09/30/94 12.88 0.34 (0.17) 0.17 (0.33) 0.00 (0.22)
Class B
06/30/99 19.06 (0.13)(a) 1.39 (a) 1.26 0.00 0.00 (2.33)
06/30/98 17.77 (0.07)(a) 4.91 (a) 4.84 (0.02) 0.00 (3.53)
10/01/96-
06/30/97 16.12 0.03 (a) 3.92 (a) 3.95 (0.05) 0.00 (2.25)
09/30/96 14.13 0.09 2.83 2.92 (0.11) (0.04) (0.78)
05/22/95-
09/30/95 12.55 0.11 1.55 1.66 (0.08) 0.00 0.00
Class C
06/30/99 18.96 (0.13)(a) 1.41 (a) 1.28 0.00 0.00 (2.33)
06/30/98 17.69 (0.07)(a) 4.88 (a) 4.81 (0.01) 0.00 (3.53)
10/01/96-
06/30/97 16.05 0.03 (a) 3.90 (a) 3.93 (0.04) 0.00 (2.25)
09/30/96 14.09 0.12 2.78 2.90 (0.13) (0.03) (0.78)
09/30/95 12.47 0.27 1.59 1.86 (0.24) 0.00 0.00
09/30/94 12.85 0.24 (0.16) 0.08 (0.24) 0.00 (0.22)
Renaissance Fund
(vii)
Class A
06/30/99 $0.00
06/30/98 0.00
10/01/96-
06/30/97 0.00
09/30/96 0.00
09/30/95 0.00
09/30/94 0.00
Class B
06/30/99 0.00
06/30/98 0.00
10/01/96-
06/30/97 0.00
09/30/96 0.00
05/22/95-
09/30/95 0.00
Class C
06/30/99 0.00
06/30/98 0.00
10/01/96-
06/30/97 0.00
09/30/96 0.00
09/30/95 0.00
09/30/94 0.00
</TABLE>
- -------
* Annualized
(a) Per share amounts based upon average number of shares outstanding during
the period.
(vi) The information provided for the Opportunity Fund reflects results of
operations under the Fund's former Sub-Adviser through March 6, 1999;
the Fund would not necessarily have achieved the performance results
shown above under its current investment management arrangements.
(vii) The information provided for the Renaissance Fund reflects results of
operations under the Fund's former Sub-Adviser through May 7, 1999; the
Fund would not necessarily have achieved the performance results shown
above under its current investment management arrangements.
PIMCO Funds: Multi-Manager Series
61
<PAGE>
<TABLE>
<CAPTION>
Ratio of Net
Ratio of Investment
Tax Basis Net Asset Expenses to Income to
Return of Total Value End of Net Assets End Average Net Average Net Portfolio
Capital Distributions Period Total Return of Period (000s) Assets Assets Turnover Rate
- -------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$0.00 $(1.07) $22.44 (0.82)% $112,507 1.85% (0.63)% 85%
0.00 (1.33) 23.77 24.70 140,438 1.86 (0.68) 66
0.00 0.00 20.18 11.25 53,686 1.86* (0.58)* 82
$0.00 $(4.62) $26.96 3.98 % $121,507 1.31% (0.86)% 175%
0.00 (1.94) 31.33 13.87 200,935 1.31 (0.88) 86
0.00 (4.91) 29.35 (8.87) 213,484 1.25* (0.12)* 69
0.00 (7.73) 37.36 18.35 134,859 1.13 (0.32) 91
0.00 (0.87) 39.08 39.70 120,830 1.20 (0.40) 102
(0.11) (2.37) 28.87 (6.70) 95,261 1.10 (0.60) 78
0.00 0.00 24.20 13.08 251 2.03* (1.65)* 175
0.00 (4.62) 24.19 3.20 308,877 2.06 (1.62) 175
0.00 (1.94) 28.86 13.01 500,011 2.06 (1.63) 86
0.00 (4.91) 27.38 (9.40) 629,446 1.97* (0.95)* 69
0.00 (7.73) 35.38 17.47 800,250 1.88 (1.07) 91
0.00 (0.87) 37.64 38.60 715,191 1.90 (1.10) 102
(0.11) (2.37) 28.04 (7.40) 553,460 1.90 (1.40) 78
$0.00 $(2.33) $18.21 9.94 % $90,445 1.26% (0.04)% 221%
0.00 (3.61) 19.10 30.98 85,562 1.26 0.35 192
0.00 (2.37) 17.73 27.53 33,606 1.23* 0.95* 131
0.00 (1.08) 16.08 22.37 20,631 1.25 1.60 203
0.00 (0.33) 14.14 16.10 12,933 1.30 2.90 177
0.00 (0.55) 12.50 1.40 14,942 1.30 2.70 175
0.00 (2.33) 17.99 8.94 126,576 2.00 (0.78) 221
0.00 (3.55) 19.06 29.99 100,688 2.01 (0.39) 192
0.00 (2.30) 17.77 26.88 37,253 1.97* 0.20* 131
0.00 (0.93) 16.12 21.54 15,693 2.00 0.85 203
0.00 (0.08) 14.13 13.30 1,760 2.10* 2.20* 177
0.00 (2.33) 17.91 9.12 442,049 2.00 (0.79) 221
0.00 (3.54) 18.96 29.98 469,797 2.01 (0.37) 192
0.00 (2.29) 17.69 26.86 313,226 1.97* 0.21* 131
0.00 (0.94) 16.05 21.52 230,058 2.00 0.85 203
0.00 (0.24) 14.09 15.20 174,316 2.10 2.10 177
0.00 (0.46) 12.47 0.70 178,892 2.00 2.00 175
</TABLE>
Prospectus
62
<PAGE>
Financial Highlights (continued)
<TABLE>
<CAPTION>
Year or Net Realized/ Dividends Dividends in Distributions
Period Net Asset Value Net Unrealized Total Income From Net Excess of Net From Net
Ended Beginning Investment Gain (Loss) on From Investment Investment Investment Realized Capital
of Period Income (Loss) Investments Operations Income Income Gains
- ------------------------------------------------------------------------------------------------------------------------
<CAPTION>
Year or Distributions
Period in Excess of
Ended Net Realized
Capital Gains
- ------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
Small-Cap Value
Fund
Class A
06/30/99 $17.58 $0.26 (a) $(1.29)(a) $(1.03) $(0.17) $0.00 $0.00
06/30/98 15.75 0.23 (a) 2.49 (a) 2.72 (0.13) 0.00 (0.76)
01/20/97-
06/30/97 14.02 0.10 1.63 1.73 0.00 0.00 0.00
Class B
06/30/99 17.43 0.14 (a) (1.27)(a) (1.13) (0.06) 0.00 0.00
06/30/98 15.71 0.09 (a) 2.48 (a) 2.57 (0.09) 0.00 (0.76)
01/20/97-
06/30/97 14.02 0.08 1.61 1.69 0.00 0.00 0.00
Class C
06/30/99 17.44 0.14 (a) (1.27)(a) (1.13) (0.04) 0.00 0.00
06/30/98 15.71 0.09 (a) 2.49 (a) 2.58 (0.09) 0.00 (0.76)
01/20/97-
06/30/97 14.02 0.08 1.61 1.69 0.00 0.00 0.00
Target Fund
(viii)
Class A
12/31/99+ $17.72 $(0.09)(a) $ 8.91 (a) $ 8.82 $ 0.00 $0.00 $(1.80)
06/30/99 16.35 (0.09)(a) 2.44 (a) 2.35 0.00 0.00 (0.98)
06/30/98 16.82 (0.08)(a) 4.06 (a) 3.98 0.00 0.00 (4.45)
10/01/96-
06/30/97 17.11 (0.04)(a) 1.82 (a) 1.78 0.00 0.00 (2.07)
09/30/96 16.40 (0.05) 2.54 2.49 0.00 0.00 (1.78)
09/30/95 13.13 (0.02) 3.45 3.43 0.00 0.00 (0.16)
09/30/94 12.72 (0.04) 0.57 0.53 0.00 0.00 (0.12)
Class B
12/31/99+ 16.44 (0.16)(a) 8.22 (a) 8.06 0.00 0.00 (1.80)
06/30/99 15.34 (0.19)(a) 2.27 (a) 2.08 0.00 0.00 (0.98)
06/30/98 16.14 (0.19)(a) 3.84 (a) 3.65 0.00 0.00 (4.45)
10/01/96-
06/30/97 16.58 (0.12)(a) 1.75 (a) 1.63 0.00 0.00 (2.07)
09/30/96 16.06 (0.09) 2.39 2.30 0.00 0.00 (1.78)
05/22/95-
09/30/95 13.93 (0.05) 2.18 2.13 0.00 0.00 0.00
Class C
12/31/99+ 16.43 (0.15)(a) 8.22 (a) 8.07 0.00 0.00 (1.80)
06/30/99 15.34 (0.19)(a) 2.26 (a) 2.07 0.00 0.00 (0.98)
06/30/98 16.13 (0.19)(a) 3.85 (a) 3.66 0.00 0.00 (4.45)
10/01/96-
06/30/97 16.58 (0.12)(a) 1.74 (a) 1.62 0.00 0.00 (2.07)
09/30/96 16.05 (0.16) 2.47 2.31 0.00 0.00 (1.78)
09/30/95 12.95 (0.12) 3.38 3.26 0.00 0.00 (0.16)
09/30/94 12.65 (0.14) 0.56 0.42 0.00 0.00 (0.12)
Tax-Efficient
Equity Fund
Class A
07/10/98-
06/30/99 $10.00 $0.03 (a) $1.56 (a) $1.59 $0.00 $0.00 $0.00
Class B
07/10/98-
06/30/99 10.00 (0.05)(a) 1.56 (a) 1.51 0.00 0.00 0.00
Class C
07/10/98-
06/30/99 10.00 (0.05)(a) 1.56 (a) 1.51 0.00 0.00 0.00
Value Fund (ix)
Class A
06/30/99 $15.64 $0.24 (a) $1.35 (a) $1.59 $(0.22) $0.00 $(1.72)
06/30/98 14.80 0.19 (a) 2.46 (a) 2.65 (0.18) 0.00 (1.63)
01/13/97-
06/30/97 13.17 0.47 1.26 1.73 (0.10) 0.00 0.00
Class B
06/30/99 15.63 0.12 (a) 1.35 (a) 1.47 (0.12) 0.00 (1.72)
06/30/98 14.80 0.07 (a) 2.46 (a) 2.53 (0.07) 0.00 (1.63)
01/13/97-
06/30/97 13.16 0.44 1.26 1.70 (0.06) 0.00 0.00
Class C
06/30/99 15.63 0.12 (a) 1.35 (a) 1.47 (0.12) 0.00 (1.72)
06/30/98 14.80 0.07 (a) 2.46 (a) 2.53 (0.07) 0.00 (1.63)
01/13/97-
06/30/97 13.15 0.43 1.28 1.71 (0.06) 0.00 0.00
<S> <C>
Small-Cap Value
Fund
Class A
06/30/99 $(0.45)
06/30/98 0.00
01/20/97-
06/30/97 0.00
Class B
06/30/99 (0.45)
06/30/98 0.00
01/20/97-
06/30/97 0.00
Class C
06/30/99 (0.45)
06/30/98 0.00
01/20/97-
06/30/97 0.00
Target Fund
(viii)
Class A
12/31/99+ $ 0.00
06/30/99 0.00
06/30/98 0.00
10/01/96-
06/30/97 0.00
09/30/96 0.00
09/30/95 0.00
09/30/94 0.00
Class B
12/31/99+ 0.00
06/30/99 0.00
06/30/98 0.00
10/01/96-
06/30/97 0.00
09/30/96 0.00
05/22/95-
09/30/95 0.00
Class C
12/31/99+ 0.00
06/30/99 0.00
06/30/98 0.00
10/01/96-
06/30/97 0.00
09/30/96 0.00
09/30/95 0.00
09/30/94 0.00
Tax-Efficient
Equity Fund
Class A
07/10/98-
06/30/99 $0.00
Class B
07/10/98-
06/30/99 0.00
Class C
07/10/98-
06/30/99 0.00
Value Fund (ix)
Class A
06/30/99 $0.00
06/30/98 0.00
01/13/97-
06/30/97 0.00
Class B
06/30/99 0.00
06/30/98 0.00
01/13/97-
06/30/97 0.00
Class C
06/30/99 0.00
06/30/98 0.00
01/13/97-
06/30/97 0.00
</TABLE>
- -------
* Annualized
+ Unaudited
(a) Per share amounts based upon average number of shares outstanding during
the period.
(viii) The information provided for the Target Fund reflects results of
operations under the Fund's former Sub-Adviser through March 6, 1999; the
Fund would not necessarily have achieved the performance results shown
above under its current investment management arrangements.
(ix) The information provided for the Value Fund reflects the results of
operations under NFJ as the Fund's Sub-Adviser. NFJ is expected to be
replaced by PIMCO Equity Advisors as the Sub-Adviser to the Fund on or
about May 8, 2000. The Fund would not necessarily have achieved the
results shown had PIMCO Equity Advisors been the Fund's Sub-Adviser
during the periods shown.
PIMCO Funds: Multi-Manager Series
63
<PAGE>
<TABLE>
<CAPTION>
Ratio of Net
Ratio of Investment
Tax Basis Net Asset Expenses to Income (Loss) to
Return of Total Value End of Net Assets End Average Net Average Net Portfolio
Capital Distributions Period Total Return of Period (000s) Assets Assets Turnover Rate
- ----------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
$0.00 $(0.62) $15.93 (5.50)% $107,569 1.25% 1.74 % 60%
0.00 (0.89) 17.58 17.33 75,070 1.25 1.27 41
0.00 0.00 15.75 12.34 6,563 1.30* 1.94* 48
0.00 (0.51) 15.79 (6.22) 96,994 2.00 0.95 60
0.00 (0.85) 17.43 16.40 110,833 2.00 0.53 41
0.00 0.00 15.71 12.05 11,077 2.04* 1.23* 48
0.00 (0.49) 15.82 (6.21) 112,926 2.00 0.95 60
0.00 (0.85) 17.44 16.42 130,466 2.00 0.52 41
0.00 0.00 15.71 12.05 20,637 2.05* 1.13* 48
$0.00 $(1.80) $24.74 51.23 % $221,955 1.20%* (0.96)%* 59%
0.00 (0.98) 17.72 15.69 170,277 1.21 (0.57) 229
0.00 (4.45) 16.35 27.49 157,277 1.22 (0.49) 226
0.00 (2.07) 16.82 11.19 150,689 1.20* (0.31)* 145
0.00 (1.78) 17.11 16.50 156,027 1.18 (0.34) 141
0.00 (0.16) 16.40 26.50 121,915 1.20 (0.10) 128
0.00 (0.12) 13.13 4.20 90,527 1.20 (0.30) 104
0.00 (1.80) 22.70 50.60 125,134 1.95* (1.72)* 59
0.00 (0.98) 16.44 14.93 78,659 1.95 (1.31) 229
0.00 (4.45) 15.34 26.45 76,194 1.96 (1.24) 226
0.00 (2.07) 16.14 10.58 67,531 1.94* (1.05)* 145
0.00 (1.78) 16.58 15.58 49,851 1.93 (1.09) 141
0.00 0.00 16.06 15.30 7,554 2.00* (0.90)* 128
0.00 (1.80) 22.70 50.69 1,307,105 1.95* (1.71)* 59
0.00 (0.98) 16.43 14.86 910,494 1.95 (1.31) 229
0.00 (4.45) 15.34 26.53 952,728 1.96 (1.24) 226
0.00 (2.07) 16.13 10.52 969,317 1.94* (1.06)* 145
0.00 (1.78) 16.58 15.66 974,948 1.93 (1.09) 141
0.00 (0.16) 16.05 25.60 780,355 2.00 (0.90) 128
0.00 (0.12) 12.95 3.40 556,043 2.00 (1.10) 104
$0.00 $0.00 $11.59 15.90% $6,579 1.11%* 0.25%* 13%
0.00 0.00 11.51 15.10 6,370 1.85* (0.50)* 13
0.00 0.00 11.51 15.10 10,742 1.84* (0.52)* 13
$0.00 $(1.94) $15.29 11.93 % $22,267 1.11% 1.68 % 101%
0.00 (1.81) 15.64 18.86 21,742 1.11 1.19 77
0.00 (0.10) 14.80 13.19 15,648 1.11* 1.71* 71
0.00 (1.84) 15.26 11.05 36,314 1.85 0.85 101
0.00 (1.70) 15.63 17.98 35,716 1.86 0.45 77
0.00 (0.06) 14.80 12.93 25,433 1.86* 0.96* 71
0.00 (1.84) 15.26 11.04 80,594 1.85 0.83 101
0.00 (1.70) 15.63 17.98 88,235 1.86 0.45 77
0.00 (0.06) 14.80 13.02 64,110 1.86* 0.97* 71
</TABLE>
Prospectus
64
<PAGE>
PIMCO Funds: Multi-Manager Series
The Trust's Statement of Additional Information ("SAI") and annual
and semi-annual reports to shareholders include additional
information about the Funds. The SAI and the financial statements
included in the Funds' most recent annual report to shareholders
are incorporated by reference into this Prospectus, which means
they are part of this Prospectus for legal purposes. The Funds'
annual report discusses the market conditions and investment
strategies that significantly affected each Fund's performance
during its last fiscal year.
The SAI includes the PIMCO Funds Shareholders' Guide for Class A,
B and C Shares, a separate booklet which contains more detailed
information about Fund purchase, redemption and exchange options
and procedures and other information about the Funds. You can get
a free copy of the Guide together with or separately from the rest
of the SAI.
You may get free copies of any of these materials, request other
information about a Fund, or make shareholder inquiries by calling
1-800-426-0107, or by writing to:
PIMCO Funds Distributors LLC
2187 Atlantic Street
Stamford, Connecticut 06902
You may review and copy information about the Trust, including its
SAI, at the Securities and Exchange Commission's public reference
room in Washington, D.C. You may call the Commission at 1-202-942-
8090 for information about the operation of the public reference
room. You may also access reports and other information about the
Trust on the EDGAR database on the Commssion's Web site at
www.sec.gov. You may get copies of this information, with payment
of a duplication fee, by electronic request at the following e-
mail address: [email protected], or by writing the Public
Reference Section of the Commission, Washington, D.C. 20549-6009.
You may need to refer to the Trust's file number under the
Investment Company Act, which is 811-6161.
You can also visit our Web site at www.pimcofunds.com for
additional information about the Funds.
[LOGO OF PIMCO FUNDS APPEARS HERE]
File No. 811-6161
<PAGE>
--------------------------------------------------------------------
PIMCO Funds:
INVESTMENT ADVISER AND ADMINISTRATOR
Multi-Manager
PIMCO Advisors L.P., 800 Newport Center Drive, Newport Beach, CA
Series 92660
--------------------------------------------------------------------
SUB-ADVISERS
PIMCO Equity Advisors division of PIMCO Advisors L.P., Cadence Cap-
ital Management, NFJ Investment Group, Parametric Portfolio Associ-
ates, Blairlogie Capital Management
--------------------------------------------------------------------
DISTRIBUTOR
PIMCO Funds Distributors LLC, 2187 Atlantic Street, Stamford, CT
06902
--------------------------------------------------------------------
CUSTODIAN
State Street Bank & Trust Co., 801 Pennsylvania, Kansas City, MO
64105
--------------------------------------------------------------------
SHAREHOLDER SERVICING AGENT AND TRANSFER AGENT
PFPC, Inc., P.O. Box 9688, Providence, RI 02940
--------------------------------------------------------------------
INDEPENDENT ACCOUNTANTS
PricewaterhouseCoopers LLP, 1055 Broadway, Kansas City, MO 64105
--------------------------------------------------------------------
LEGAL COUNSEL
Ropes & Gray, One International Place, Boston, MA 02110
--------------------------------------------------------------------
For further information about the PIMCO Funds, call 1-800-426-0107
or vist our Web site at www.pimcofunds.com.
<PAGE>
PIMCO Funds is on theWeb
www.pimcofunds.com
A Partial List of What's Available:
On-line Account Access
Daily Share Prices
Daily Manager Commentary
Current and Historical Fund Performance
Lipper Rankings
Morningstar Ratings
Listing of Fund Portfolio Holdings
Risk Analysis
Fund Manager Bios
Downloadable Literature Section
On-line Requests for Literature by Mail
Resources for Investment Professionals
Through the PIMCO Funds Website, at www.pimcofunds.com, you and your financial
advisor have around-the-clock access to the most timely and comprehensive
information available on PIMCO Funds.
In addition, the site includes daily commentary from our fund managers, with
insights on the economy and other factors affecting the stock and bond markets.
And now you can access your account--securely--on- line. This feature is
available to shareholders with direct accounts (a direct account is one where
the shareholder receives statements directly from PIMCO Funds.)
[GRAPHIC]
You'll find the site to be informative and easy-to-use. It's divided into three
main sec- tions: Investment Insight, Fund Information and Resources.
Investment Insight
The Investment Insight section provides an overview of the investment management
firms under the PIMCO Advisors L.P. umbrella. You'll find an explanation of each
firm's investment process, biographies of the investment team, manager updates
and more.
Fund Information
In the Fund Information section you'll access detailed profiles of all the PIMCO
Funds, including current and historical performance, Lipper rankings and
Morningstar ratings.
Additionally, we provide a summary of a fund's portfolio-- complete with risk
analysis data. You can also obtain daily fund share prices. Please read the
relevant prospectus careful- ly before you invest in any PIMCO Fund.
Resources
Our Resources section features a variety of useful information, including:
. an on-line document library with applications and prospectuses that you can
view and print
. a literature-by-mail "catalog," so you can order free materials
. information about our convenient shareholder services, such as Auto-Invest,
Fund Link and our 24-Hour Telephone Information System
. a listing of the features and benefits of the retirement plans offered by
PIMCO Funds
Questions?
We're sure you'll find the PIMCO Funds Web site to be an invaluable tool. If you
have any questions about the site, call us at 1-800-426-0107.
Or, send us e-mail at [email protected].
Not part of the Prospectus
[LOGO OF PIMCO FUNDS]
PIMCO Funds
Distributors LLC
2187 Atlantic Street
Stamford, CT 06902-6896
<PAGE>
PIMCO FUNDS: MULTI-MANAGER SERIES
Supplement Dated April 3, 2000
to the
Prospectus for Class A, B and C Shares
Dated April 3, 2000
Disclosure Relating to PIMCO Value Fund
Changes in Sub-Advisory Arrangements. On or about May 8, 2000, the PIMCO
Equity Advisors division of PIMCO Advisors L.P. ("PIMCO Equity Advisors") will
assume full portfolio management responsibility for the PIMCO Value Fund under
the terms of the Trust's investment advisory agreement with PIMCO Advisors.
Until such time when PIMCO Equity Advisors assumes full portfolio management
responsibility for the Fund (the "Transition Date"), NFJ Investment Group
("NFJ"), the Fund's current Sub-Adviser, will continue to provide portfolio
management services under the terms of its Portfolio Management Agreement with
PIMCO Advisors. Information about NFJ is provided in the Prospectus under the
caption "Management of the Funds."
Until the Transition Date, Chris Najork, Benno J. Fischer and Paul A.
Magnuson will share primary responsibility for the day-to-day management of
the Fund. Messrs. Najork and Fischer have provided portfolio management
services to the Fund since its inception in December 1991. Mr. Magnuson has
provided portfolio management services to the Fund since July, 1995.
Information about Messrs. Najork, Fischer and Magnuson is provided in the
Prospectus under the caption "Management of the Funds--NFJ."
Changes to Principal Investments and Strategies. Until the Transition Date,
the description of the Fund under "Principal Investments and Strategies" in
the Fund's Fund Summary is amended to read in its entirety as follows:
The Fund seeks to achieve its investment objective by normally investing
at least 65% of its assets in common stocks of companies with market
capitalizations of more than $2 billion at the time of investment and below
average P/E ratios relative to the market and their respective industry
groups. To achieve income, the Fund invests a portion of its assets in
income-producing (or dividend-paying) common stocks.
The Fund's initial selection universe consists of the 1,000 largest
publicly traded companies (in terms of market capitalization) in the U.S.
The portfolio managers classify the universe by industry. They then
identify the most undervalued stocks in each industry based mainly on
relative P/E ratios, calculated both with respect to trailing operating
earnings and forward earnings estimates. After narrowing this universe to
approximately 150 candidates, the portfolio manager selected approximately
40 stocks for the Fund, each representing a different industry group. The
portfolio managers select stocks based on a quantitative analysis of
factors including price momentum (based on changes in stock price relative
to changes in overall market prices), earnings momentum (based on analysts'
earnings per share estimates and revisions to those estimates), relative
dividend yields, valuation relative to the overall market and trading
liquidity. The Fund's portfolio is generally rebalanced quarterly. The
portfolio managers may also replace a stock when a stock within the same
industry group has a considerably lower valuation than the Fund's current
holding.
Under normal circumstances, the Fund intends to be fully invested in
common stocks (aside from certain cash management practices). The Fund may
temporarily hold up to 10% of its assets in cash and cash equivalents for
defensive purposes in response to unfavorable market and other conditions.
This would be inconsistent with the Fund's investment objective and
principal strategies.
In addition, in connection with the above changes, until the Transition Date
the disclosure under "Principal Risks" in the Fund Summary is revised to
indicate that the following are among the principal risks of investing in the
Fund: Market Risk, Issuer Risk, Value Securities Risk, Credit Risk and
Management Risk.
<PAGE>
Disclosure Relating to PIMCO Equity Income Fund
Changes in Sub-Advisory Arrangements. On or about May 8, 2000, the PIMCO
Equity Advisors division of PIMCO Advisors L.P. ("PIMCO Equity Advisors") will
assume full portfolio management responsibility for the PIMCO Equity Income
Fund under the terms of the Trust's investment advisory agreement with PIMCO
Advisors. Until such time when PIMCO Equity Advisors assumes full portfolio
management responsibility for the Fund (the "Transition Date"), NFJ Investment
Group ("NFJ"), the Fund's current Sub-Adviser, will continue to provide
portfolio management services under the terms of its Portfolio Management
Agreement with PIMCO Advisors. Information about NFJ is provided in the
Prospectus under the caption "Management of the Funds."
Until the Transition Date, Chris Najork and Benno J. Fischer will share
primary responsibility for the day-to-day management of the Fund. Messrs.
Najork and Fischer have provided portfolio management services to the Fund
since its inception in March 1991. Information about Messrs. Najork and
Fischer is provided in the Prospectus under the caption "Management of the
Funds--NFJ."
Changes to Principal Investments and Strategies. Until the Transition Date,
the description of the Fund under "Principal Investments and Strategies" in
the Fund's Fund Summary is amended to read in its entirety as follows:
The Fund seeks to achieve its investment objective by normally investing
at least 65% of its assets in income-producing (or dividend-paying) common
stocks of companies with market capitalizations of more than $2 billion at
the time of investment.
The Fund's initial selection universe consists of the 1,000 largest
publicly traded companies (in terms of market capitalization) in the U.S.
The portfolio managers classify the universe by industry. They then
identify the most undervalued stocks in each industry based mainly on
relative P/E ratios, calculated both with respect to trailing operating
earnings and forward earnings estimates. From this group of stocks, the
Fund buys approximately 25 stocks with the highest dividend yields. The
portfolio managers then screen the most undervalued companies in each
industry by dividend yield to identify the highest yielding stocks in each
industry. From this group, the Fund buys approximately 25 additional stocks
with the lowest P/E ratios.
In selecting stocks, the portfolio managers consider quantitative factors
such as price momentum (based on changes in stock price relative to changes
in overall market prices), earnings momentum (based on analysts' earnings
per share estimates and revisions to those estimates), relative dividend
yields, valuation relative to the overall market and trading liquidity. The
portfolio managers may replace a stock when a stock within the same
industry group has a considerably higher dividend yield or lower valuation
than the Fund's current holding.
Under normal circumstances, the Fund intends to be fully invested in
common stocks (aside from certain cash management practices). The Fund may
temporarily hold up to 10% of its assets in cash and cash equivalents for
defensive purposes in response to unfavorable market and other conditions.
This would be consistent with the Fund's investment objective and principal
strategies.
In addition, in connection with the above changes, until the Transition Date
the disclosure under "Principal Risks" in the Fund Summary is revised to
indicate that the following are among the principal risks of investing in the
Fund: Market Risk, Issuer Risk, Value Securities Risk, Credit Risk and
Management Risk.
2
