Oklahoma Municipal Retirement Fund - OkMRF · 4/25/2016 · The views expressed in this...

For Institutional Use Only. Not for use with the Public.

The views expressed in this presentation are those of Pioneer, and are

subject to change at any time. These views should not be relied upon as investment

advice, as securities recommendations, or as an indication

of trading intent on behalf of any of Pioneer’s strategies.

Pioneer Institutional Asset Management, Inc.

60 State Street, Boston MA 02109

Oklahoma Municipal Retirement Fund

April 29, 2016

Page 2 I For Institutional Use Only I March 2016

Agenda

1. Account Update

2. Firm Update & Fixed Income Overview

3. Multi-Sector Fixed Income CIT Overview

4. Economic Outlook

5. Appendices


Defined Benefit Bond Funds Performance

MTD YTD 1-Year 3-YearInception to Date

(11/1/11)

Portfolio Return – Tier 3 2.50% 2.34% -0.40% 2.07% 4.01%

Barclays U.S. Universal Index

Return1.23% 3.07% 1.75% 2.51% 3.16%


Defined Benefit Bond Funds

Source: SEI Trust Company. Returns are net of trustee fee and operating expense As of March 31, 2016.

Past Performance is no guarantee of future results.

Market Value

$61,649,483


Defined Contribution Total Yield Fund

MTD YTD Inception to Date (10/01/15)

Portfolio Return – Tier 2 (net) 2.43% 2.27% 1.68%

Barclays U.S. Universal Index

Return1.23% 3.07% 2.51%


Defined Contribution Total Yield Fund

Source: SEI Trust Company. As of March 31, 2016


Market Value

$4,123,822



Portfolio Management & Relationship Management

Ken Taubes

617-517-8833

[email protected]

Andrew Feltus, CFA

617-422-4860

[email protected]

Charles Melchreit, CFA

617-422-4854

[email protected]

Portfolio Management Team

Relationship Management Team

Meredith Birdsall, CFA

617-422-4840

[email protected]

Craig DeGiacomo

617-422-4205

[email protected]

As of March 31, 2016

mailto:[email protected]






Pioneer Multi-Sector Fixed Income

Benchmark Barclays U.S. Universal Index

Investment Universe U.S. and international government, investment grade corporate, high yield and emerging market bonds

Investment Approach Integrated top-down and bottom-up approach to investing across global fixed income sectors

Top Down: actively allocate among all global fixed income sectors strategically overweighting

those we believe with superior relative value characteristics.

Bottom Up: rigorous fundamental research approach to issue selection leveraging Pioneer’s

extensive global fixed income capabilities.

Management Team Ken Taubes, Andy Feltus, and Charles Melchreit

Composite Inception Date July 1999

Assets Under Management $12.95 billion as of December 31, 2015

Credit Quality Range of Portfolio* A to BBB (minimum of BBB- investment grade rating)

Duration Within +/- 2 years of benchmark

Investment Horizon Typically 1-3 years

Holdings Typically 600

Historical Turnover Range 30-50%

*Credit Quality Range is a range of the ratings of the underlying fixed income securities, cash, and cash equivalents held in the representative account of the composite as of the

date noted, as provided by Moody's Investor Service or the Standard & Poor's ("S&P") or Fitch's, as applicable. If the ratings provided by the rating agency for a security differ, the

higher of the ratings is included. Bond ratings are ordered highest to lowest in a portfolio. Based on S&P's measures, AAA (the highest possible rating) through BBB are

considered "investment grade". Cash equivalents and some bonds may not be rated.

Please note: The Internal guidelines referenced do not necessarily represent statutory limitations. These internal guidelines are used as guidance in the daily

management of the Strategy’s investments. These guidelines are subject to change and should not be relied upon as a long-term view of the Strategy’s

exposures, limitations and/or risks.


Agenda

1. Account Update



4. Economic Outlook

5. Appendices


Firm Overview

• Value investing: Pillar of Pioneer’s investment culture since 1928

• Global investment hubs: Boston, Dublin, London

– Over 25 countries

– Over 1,900 employees

– Over 300 investment professionals

• Assets under management:

– Global: $243.4 billion

– U.S.: $67.0 billion, including $38.5 billion fixed income

and alternatives

– U.S. Managed Institutional: $12.4 billion

As of December 31, 2015

Boston

London

Dublin


$38.5 Billion in US Fixed Income and Alternative Assets Under Management

as of December 31, 2015

Pioneer Fixed Income and Alternatives Capabilities and Assets in $Billions

$2.68

$4.73

$12.96$3.76

$5.33

$1.53

$0.32

$0.33

$2.44

$3.68

$0.33 $0.38

$0.03$0.09

Investment Grade*

Opportunistic Core

Multi-Sector Fixed Income

Global High Yield

US High Yield

Bank Loans

Credit Opportunities

Money Markets

Municipals

Multi-Asset Ultrashort Income/Short-Term Income

Alternatives

Dynamic Credit

Global Multi-Sector Fixed Income

Insurance-Linked Securities

Source: Pioneer Research as of December 31, 2015 in billions $ USD

*Primarily includes Intermediate Investment Grade, Investment Grade Long Duration, Investment Grade Multisector, US Government, Intermediate and Mortgage Credit Opportunity, Global

Fixed Income.

We also manage approximately $2,079 million in Balanced/Flexible portfolios consisting of $823 million in Flexible Opportunities, $828 million in Multi-Asset Income and $428 million in

Balanced portfolios.


Full Coverage of Global Fixed Income Universe

Dublin

Global, European Investment Grade

Fixed Income

• 18 Portfolio Managers

• 10 Credit Research Analysts

London

Emerging Markets, Currency

Euro High Yield




Boston

Multi-Sector, Credit, Broad Bonds, US

and Global High Yield




Pioneer InvestmentsUS Fixed Income Team

1Represents members of the structured research team. As of March 18, 2016.

Michael Temple

Director of

Credit Research

Ken Taubes

Chief Investment Officer, US

Head of Fixed Income

Anthony J. Koenig, Jr.

Chief of Staff, US

Jonathan Sharkey

Tracy Wright

Joseph Hogan, CFA

Non-US Fixed Income

13 Research Analysts

RESEARCH

Andrew Feltus, CFA

Director of High Yield

and Bank Loans

David Eurkus

Director of

Municipals

Thomas Swaney

Head of Alternative

Fixed Income

Charles Melchreit, CFA

Director of Investment

Grade

PORTFOLIO MANAGEMENT

Steve Bernhardt1

Bradley Komenda, CFA

Chin Liu

Nicolas Pauwels1

Seth Roman, CFA

Jonathan Scott, CFA

Larry Zeno1

Jonathan Chirunga Benjamin Gord

Kevin Choy, CFA

Paresh Upadhyaya

Director of Currency

Strategy, US

Risk/ComplianceTrading Equity Research

Betty Chan, CFA

Senior Portfolio

Construction Analyst

US Fixed Income

14 Research Analysts

Meredith Birdsall, CFA

Client Portfolio Manager

Andrew Goodale


Joseph Morgart



Global Corporate Credit Research Teams

Asset Class Geography

Name Industry CoverageInvestment

GradeHigh Yield US Europe

Emerging

Markets

Jeff Payne (30) Capital Goods, Healthcare, Materials, Utilities ✓ ✓

Andrew Schiappa (6) Autos, Insurance, REITs, Transportation ✓ ✓

Priyanka Khare (4) Technology, Consumer, Telecom ✓ ✓

Jessica Frattura (13) Financials, Cable ✓ ✓ ✓

Erin Olofson (8) Energy, Media ✓ ✓ ✓

Andriy Boychuck (10) Autos ✓ ✓ ✓

Max Castle (7) Retail ✓ ✓ ✓

Paul Cheung (6) Real Estate, Retail ✓ ✓ ✓ ✓

Brian Farrell (20) Industrials, Energy ✓ ✓ ✓ ✓

Alison Harvey (9) Capital Goods ✓ ✓ ✓ ✓

Ray Jian (7) Industrials, Shipping ✓ ✓ ✓ ✓

Suzanne Keane (18 ) Utilities ✓ ✓ ✓

Conor McCarrick (13) Cable, Paper & Packaging/Chemicals/TMT ✓ ✓ ✓ ✓

Gavin McKeown (17) Telecom, Media, Packaging ✓ ✓ ✓ ✓

Jing Nie (1) Financials ✓ ✓ ✓

Florent Robineau (20) Metals & Mining ✓ ✓ ✓

Marina Vlasenko (13) Financials ✓ ✓ ✓ ✓

Ciaran Callaghan (11) Financials ✓ ✓

David Brecht (19) Healthcare, Consumer Products ✓ ✓

Alan Buck (20) Leveraged Loan Generalist ✓ ✓

Josh Gonzalez (4) Gaming, Retail, Consumer Brands ✓ ✓ ✓

Keith Hogan (18); Automotive, Industrials, Manufacturing ✓ ✓

Matthew Shulkin (18) Broadcasting, Metals & Mining, Utilities ✓ ✓

Richard Stevens (29) Technology, Housing, Cable, Telecom ✓ ✓

William Taylor (9) Energy, Chemicals ✓ ✓

William Woo (26) Transportation, Refining, Paper/Packaging ✓ ✓ ✓


Figures in parenthesis denote industry experience, team members are subject to change


Global Currency Professionals

9 Investment Professionals

Name Responsibility

Paresh Upadhyaya Head of FX Strategy (US)

Andreas Koenig Head of FX Strategy (Europe)

Hakan Aksoy Global EM PM

Derek Arnold FX PM (Europe)

Margarete Strasser Global Fixed Income PM

Joseph Hogan FX Strategist (US)

Riccardo Soggiu Global Macro Economist

Dan Sim FX Trader

Mark Phillips FX Trader



Agenda

1. Account Update



4. Economic Outlook

5. Appendices


Multi-Sector Fixed Income Investment PhilosophyConsistent approach since 1999 inception

• Driven by Fundamentals:

- The team seeks to invest in broad sectors that offer attractive relative value on a risk-adjusted basis.

• Broad Diversification*:

- Broader opportunity set increases the potential for higher returns, while also providing diversification

benefits due to low correlations.

• Downside Risk Focus:

- Seeks to mitigate loss by avoiding at-risk sectors and securities.

• Performance targets over a market cycle:

- Volatility: 4.0% to 5.0%, similar to the Barclays US Universal Bond Index (benchmark)

- Excess return: 1.5% to 2.0%

- Tracking error: 2.0% to 4.0%

*Diversification does not guarantee a profit or protect against a loss.

Please Note: The Internal Guidelines referenced do not necessarily represent statutory limitations. These internal guidelines are used as guidance in the daily management of the strategy’s

investments. These guidelines are subject to change and should not be relied upon as a long term view of the strategy’s exposures, limitations, and/or risks.


Multi-Sector Fixed Income Team

• Stable, experienced team

– Portfolio Managers: 28 years’ average industry experience and 16 years with Pioneer

– Fixed Income Team: 20 years’ average investment experience; expertise across entire fixed income

spectrum

– No portfolio manager turnover since strategy inception in 1999

Charles Melchreit, CFAPortfolio Manager

Ken TaubesChief Investment Officer, U.S.

Lead Portfolio Manager

Andrew Feltus, CFAPortfolio Manager

Portfolio Management Team



Multi-Sector Fixed IncomeInvestment Framework

Investment Parameters

Credit Quality Range*: A to BBB (minimum of BBB- investment grade rating)

Non-Investment Grade:60% maximum (includes high yield bonds, bank loans, emerging markets issues, non-

agency mortgage-backed securities/asset-backed securities, high yield convertible bonds)

Currency: 30% maximum non-USD, including 10% emerging markets

Non-US Exposure: 50 % maximum, including 25% emerging markets

Industry: 25% maximum limit

Issuer: 5% maximum, typical 0.30% to 0.50% (10% issuer enterprise value)

Duration: +/- 2 years compared to benchmark

Cash: 0% to 5%

Investment Ranges

Investment Horizon: 1 to 3 years with a typical turnover range of 30% to 50%



*Credit Quality Range is a range of the ratings of the underlying fixed income securities, cash, and cash equivalents held in the representative account of the composite as of the date noted, as

provided by Moody's Investor Service or the Standard & Poor's ("S&P") or Fitch's, as applicable. If the ratings provided by the rating agency for a security differ, the average of the ratings is

included. Bond ratings are ordered highest to lowest in a portfolio. Based on S&P's measures, AAA (the highest possible rating) through BBB are considered "investment grade“; BB or lower

ratings are considered non-investment grade. Cash equivalents and some bonds may not be rated.


Multi-Sector Fixed Income: Investment Process

Portfolio Construction

& Risk Assessment

Macro Themes

& Outlook

Asset

Allocation

Security Research

& Analysis

Security

Selection


Multi-Sector Fixed IncomeInvestment Decision-Making Process

• Weekly Fixed Income team meeting

– Review macroeconomic developments and trends

– Discuss asset class valuations and fundamentals with sector portfolio

managers

– Develop investment themes from Analyst team

– Document through investment theme matrix

• Portfolio Management meeting

– Assess ex-ante risk versus cash and versus benchmark, and risk and sector

contributions to total volatility and tracking error volatility

– Review and revise risk and sector exposures in context of Fixed Income

meeting and investment theme matrix

Macro Themes

and Outlook

Asset

Allocation


Multi-Sector Fixed IncomeInvestment Decision-Making Process (continued)

• Asset allocation aligned with portfolio-specific objectives and risk

tolerances

• Non-siloed approach to sector investment

– Appropriate sector risk profile and contribution to overall

portfolio volatility

– Optimal exposure for specific risk

– Non-overlapping risk exposures

• Portfolio managers make all investment decisions

– Sector portfolio managers can determine security selection,

within specific industry and risk parameters specified by

portfolio managers

Macro Themes

and Outlook

Asset

Allocation


• Intensive fundamental research to find attractive opportunities

– Analysts primary source of idea generation

– Portfolio managers can also contribute

– Generate ideas to meet target sector exposures, with appropriate risk

profile for

specific strategy

– Highly collaborative decision-making process

– Internally-generated research

• Portfolio managers or sector portfolio managers make security decision

• Buy discipline:

– Focus on total return, not simply yield

– Seek price appreciation from mispriced securities

– Emphasize downside risk assessment alongside capital appreciation

• Sell discipline:

– Deterioration in fundamentals

– More attractive alternatives

Security Research

and Analysis

Security

Selection

Security Research

and Analysis

Security

Selection

Multi-Sector Fixed IncomeInvestment Decision-Making Process (continued)


Multi-Sector Fixed IncomeRisk Management Process and Systems

Multiple Levels of Risk Management



Investment

Committee

Portfolio

Management

Independent Risk

Management

Legal and

Compliance

Guideline Limits

• Diversification of issuer and industry

• Average investment grade quality

• 30% non-dollar currency

• Duration of +/- 2 years versus benchmark

Risk Monitoring

• Daily risk analysis and decomposition

• Value-at-risk and tracking error by sources of risk

• Scenario and worst-case analysis

Compliance

• Pre-trade and post-trade compliance with

investment guidelines

Risk Systems

• Barclays Point Global Risk Model and Attribution

Module

• BlackRock Solutions operation management

system—Aladdin


Performance DriversMultiple Alpha Sources through Diversified Approach



Asset Allocation35% to 45%

Security Selection20% to 30%

Quality Rating10% to 20%

Duration10% to 15%

Curve Positioning5% to 10%

Currency0% to 10%


Multi-Sector Fixed Income CIT: Sector Allocation

Source: Pioneer Investments. The strategy is actively managed; sector allocations will vary over other periods and do not reflect a commitment

to an investment policy or sector.

11/30/2012 0:00

12/31/2012 0:00

1/31/2013 0:00

2/28/2013 0:00

3/31/2013 0:00

4/30/2013 0:00

5/31/2013 0:00

6/30/2013 0:00

7/31/2013 0:00

8/31/2013 0:00

9/30/2013 0:00

10/31/2013 0:00

11/30/2013 0:00

0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

100%Cash

TreasuryMunicipals

Agency Mortgage-Backed Securities

Non-Agency Mortgage-Backed Securities

Asset-Backed Securities

Commercial Mortgage-Backed Securities

International Investment Grade

Bank Loans

U.S. Investment Grade

U.S. High Yield*

International High Yield

Emerging Markets**

Convertible Securities

—6%

—2%

—18%

—7%

—2% —3%

—8%

—10%

—16%

—17%

—3%

—7%

—2%

Data as of March 31, 2016.

*Includes Event-Linked Bonds (1%), Common and Preferred Stock (>1%) **Sovereign (4%) and Corporate (3%)

Due to rounding, figures may not total 100%.



Multi-Sector Fixed Income CIT : Portfolio Characteristics

2.02%

2.07%

2.29%

2.87%

3.38%

5.77%

6.76%

7.46%

7.54%

9.87%

15.68%

17.19%

17.55%

0% 5% 10% 15% 20%

Municipals

ABS

Convertibles

Int'l High Yield

CMBS

Treasury

CMO

Emerging Markets***

Int'l Investment Grade

Bank Loans

U.S. Investment Grade

U.S. High Yield**

Agency MBS

Portfolio %

Duration Distribution %

0 to 1 Year 6.5

1 to 3 Years 28.0

3 to 5 Years 23.0

5 to 7 Years 17.7

7 to 10 Years 10.7

10+ Years 14.2

Characteristics

Average Credit Quality* BBB+

Effective Duration 4.35 Years

Average Life 8.99 Years

Yield to Worst 4.46%

Quality Distribution* %

AAA 32.7

AA 4.0

A 8.2

BBB 19.6

Below BBB 33.3

Not Rated 2.2

**Includes Event-Linked Bonds (1%), Preferred Stock (0.1%) ***Includes Sovereign (4%) and Corporate (3%)

*Ratings reflect the average numeric rating equivalent of available ratings of Moody’s, Standard & Poor’s and Fitch, with midpoints averaged to the lower rating. Bond ratings are ordered highest to

lowest in portfolio. Based on S&P’s measures, AAA (highest possible rating) through BBB are considered “investment grade”; BB or lower ratings are considered non-investment grade. Cash

equivalents and some bonds may not be rated. This is not a rating of the Strategy’s overall credit quality. The rating includes securities that have not been rated by either of the rating agencies, which

has the effect of reducing the overall average. Source: Barclays Point. The rating is as of March 31, 2016 and will change over time. Please note that that Strategy itself has not been rated by any

independent rating agency.


Multi-Sector Fixed Income CIT: Performance


Source: SEI Trust Company. Multi-Sector Fixed Income CIT returns are net of trustee fee and operating expense. As of March 31, 2015.


2.50%2.26%

1.76%

-0.39%

2.08%

5.23%

1.23%

3.07%2.51%

1.75%

2.51%

3.40%

-1%

1%

3%

5%

7%

9%

MTD QTD 6 Months 1 Year 3 Year Since CIT Inception(7/29/11)

Pioneer Multi-Sector Fixed Income CIT Tier 3 Barclays U.S. Universal Index


Multi-Sector Fixed Income CIT: Attribution

2015 1Q16

Pioneer Multi-Sector Fixed Income CIT (gross)* -0.76% 2.31%

Barclays U.S. Universal Index 0.43% 3.07%

Total Outperformance -1.19% -0.76%

Currency -0.40% -0.04%

Duration -0.22% -0.67%

Yield Curve 0.09% -0.08%

Sector 0.22% 0.28%

Quality -0.18% 0.13%

Security -0.70% -0.38%

Total Outperformance -1.19% -0.76%

Source: Pioneer Investments, Barclays Point. Gross of Fees

*Gross performance does not reflect trustee fee and operating expenses


Agenda

1. Account Update



4. Economic Outlook

5. Appendices


• We expect modest growth of approximately 2% to 2.5% over the next year in the US led by consumption, the housing sector and improved government spending.

• Easy global monetary policies may continue to support growth. Europe may enjoy higher-than-expected growth from the European Central Bank stimulus, lower euro and lower oil prices.

• Corporations are currently enjoying solid margins and balance sheets. They may continue to benefit from US growth and a stabilized global economic climate, although they may begin to experience margin pressures from wage increases.

• While multi-nationals have experienced significant headwinds from the strong dollar, this should diminish as the rate of change begins to slow. Shareholder-friendly activity remains a risk(bondholders)/opportunity (equity owners) in many slow-growing sectors.

• Many emerging market countries may suffer from high levels of US dollar-denominated debt, as well as continued low commodities prices and lower growth in China.

• The greatest risks to our forecast are a much stronger dollar that continues to put downward pressure on US manufacturing, trade, commodities and emerging market countries; disappointing growth in China; and global geo-political uncertainties.

2016 Economic Outlook


Financial Markets Performance in 2015 and YTD 2016

Source: Pioneer Investments, Bloomberg and Barclays. 2015 data as of December 31, 2015. YTD as of February 24, 2016. Indices are unmanaged and their returns assume reinvestment of

dividends, and unlike investment product returns, do not reflect any fees or expenses. It is not possible to invest directly in an index. Past performance is no guarantee of future results

1.2%

1.5%

1.0%

1.4%

-0.7%

-4.6%

-0.7%

-0.8%

4.5%

1.4%

0.5%

1.8%

1.3%

-35.0%

11.4%

10.9%

-40% -30% -20% -10% 0% 10% 20%

1-10 Year US Treasuries

US Agency MBS

US CMBS

US Non-Agency MBS/ABS

US IG Corporates

US High Yield

US HY X Enrgy X Mtls/Mining

Bank Loans

Event-linked Bonds (ILS)

S&P 500 Index

1-10-Year Bund (EUR)

EM Sovereigns USD

EM Corp USD

Brent Oil

USD/EUR

Trade-Weighted USD Index

20151.6%

1.6%

2.3%

-0.6%

0.8%

-2.9%

-1.4%

-1.7%

0.5%

-5.3%

1.7%

1.2%

0.8%

-7.7%

-1.4%

-1.8%

-10% -5% 0% 5%

YTD-2016


Solid Private Sector Growth Has Been Offset by “Fiscal Austerity”Public Sector Spending will Contribute More than in Prior Years

GDP = Gross Domestic Product

Year-over-year monthly percent change. Source: FactSet. Reflects latest revision. Updated as of April 11, 2016. Last data point March 31, 2016.

1.98%

1.11%

2.16%

-8

-6

-4

-2

0

2

4

6

8

1996 1999 2001 2003 2006 2008 2010 2013 2015

An

nu

al

Gro

wth

Rate

%

U.S. GDP U.S. Government Component of GDP The Rest of U.S. GDP


US Index of Leading Economic Indicators

US Economic OutlookThe Index of Leading Economic Indicators is Still Rising

Source: FactSet

Last data point. February 29, 2016, updated as of April 11, 2016.

0

20

40

60

80

100

120

1401

96

0

19

62

19

64

19

66

19

68

19

70

19

72

19

74

19

76

19

78

19

80

19

82

19

84

19

86

19

88

19

90

19

92

19

94

19

96

19

98

20

00

20

02

20

04

20

06

20

08

20

10

20

12

20

14

20

16

Recession Periods - United States Leading Economic Index - United States

The U.S. Conference

Board Leading Economic

Index


Source: Pioneer Investments, Bloomberg. Last data point March 31, 2016. Updated April 11, 2016.

Labor Market

Business Conditions are Generally Improving

-1000

-800

-600

-400

-200

0

200

400

600

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Net

Ch

an

ge (

Pers

on

s in

000s)

Labor Market Showing Strong Gains

Non-Farm Payroll

12 month Avg.

3 month Avg.

-1%

1%

3%

5%

7%

9%

11%

13%

15%

1960 1970 1980 1990 2000 2010

Headline unemployment rate

Unemployed for 15 weeks or more

Cyclical Signs of Recovery

200

250

300

350

400

450

500

550

600

650

700

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Net

Ch

an

ge (

Pers

on

s in

000s)

Jobless Claims Consolidating

Jobless Claims 4-Week Moving Avg.

30

35

40

45

50

55

60

65

2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 2015

Dif

fus

ion

In

de

x

Leading Indicators Mixed

ISM Manufacturing

ISM Non-Manufacturing


InflationCPI, CPI-Commodities, CPI Services Are Trending Higher

0.0%

0.5%

1.0%

1.5%

2.0%

2.5%

3.0%

3.5%

4.0%

2008 2009 2010 2011 2012 2013 2014 2015 2016

CPI Core Inflation (Ex-food and energy) CPI Services (Ex-energy)

Evidence of Inflation

Year-over-year monthly percent change. Source: Pioneer Investments and Bloomberg. Last data point 2/29/2016.


Federal Funds Forecast:Divergence between the FOMC and the Federal Funds Futures Market

Source: Federal Reserve DOTS latest projections released from the FOMC’s March 2016 Meeting. Bloomberg, March 31, 2016.

0.88%

1.88%

3.00%

0.54%

0.75%

1.00%

0%

1%

2%

3%

4%

2015 2016 2017 2018 Longer Term

FOMC (Mar-16 Median Rate)

FOMC (Dec-15 Meeting Median Rate)

Fed Funds Futures 12/31/15

Fed Funds Futures 3/31/16

. . . and more recently

were even lower

The market's predictions for rates were

well below the Fed's in December 2015 . . .


Central Banks’ Financial Repression Set to Continue

Nominal Rates

Source: Pioneer Investments, Bloomberg. Data as of March 31, 2016.

-2

0

2

4

6

8

20

00

20

01

20

02

20

03

20

04

20

05

20

06

20

07

20

08

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

Ra

tes %

US Eurozone UK Japan Switzerland Sweden Denmark

12/16/15: FOMC raised target rate

From: .25

To: range of .25 to .50.


Divergence between US and Global Monetary Policies

Total G4 Balance Sheet: Increased by

• $2000 billion or ~5.0% of GDP in 2013 ($1300 billion Federal Reserve, $700 billion Bank of Japan)

• $1000 billion in 2014 ($300 billion Federal Reserve, $700 billion Bank of Japan)

• Projecting $1300 billion in 2015 ($700 billion Bank of Japan and $600 billion European Central Bank)

Source: Pioneer Investments, Bloomberg, as of March 2016


China: Structural Economic Transition is on Track China Hard Landing

0

2

4

6

8

10

12

14

16

18

20

%

GDP (real) Secondary sector (real)

Tertiary sector (real) Primary sector (real)

China GDP Growth by Sectors (% y/y)

Source: CEIC, Pioneer Investments. Data as of March 31, 2016.

-60.0

-40.0

-20.0

0.0

20.0

40.0

60.0

80.0

100.0

Ye

ar

on

Ye

ar

% C

ha

nge

China Export Trade USD YoY

China Import Trade USD YoY

China Exports and Imports


The Big Picture: Debt Deleveraging in DM at Early Stage

Total Credit Total Credit - DM (as % of their GDP)

Notes: Data are for credit to non-financial sector. Coverage: 5 DMs: US, Eurozone, UK, Japan, Canada; 15 EMs: China, India, Indonesia, Malaysia, Thailand, Korea, Russia, Turkey,

Poland, Czech, Hungary, Brazil, Mexico, Argentina; South Africa. Sources: Pioneer Investments, BIS. Data as of February 29, 2016.

0

20

40

60

80

100

120

140

160

180

US

D T

rillio

n

EMs DMs

50

60

70

80

90

100

110

DMs - Government DMs - Households

DMs - Corporations


…and Emerging Markets are Still Piling up Debt, Especially in Private Sector

Total Credit - EM (as % of GDP) Total Credit By Country (as % of GDP)

0

20

40

60

80

100

120

140

EMs - Government EMs - Households

EMs - Corporations EMs - Private

0

50

100

150

200

250

300

20

07

Q3

20

15

20

07

Q3

20

15

20

07

Q3

20

15

20

07

Q3

20

15

20

07

Q3

20

15

20

07

Q3

20

15

20

07

Q3

20

15

20

07

Q3

20

15

20

07

Q3

20

15

20

07

Q3

20

15

Brazil China India KoreaMalaysiaMexico Poland RussiaThailandTurkey

Private Public

Notes: Data are for credit to non-financial sector. Coverage: 15 EMs: China, India, Indonesia, Malaysia, Thailand, Korea, Russia, Turkey, Poland, Czech, Hungary, Brazil, Mexico,

Argentina; South Africa. Source: Pioneer Investments, BIS. Data as of February 29, 2016.


Nominal and Real 2-Year and 30-Year Treasury Yields: Historically Low

Constant Maturity Rates. Source: US Federal Reserve/Bloomberg. Treasury Yields as of 3/1/2016. PCE as of 2/29/2016.

-2%

0%

2%

4%

6%

8%

10%

12%

14%

16%

18%

1977 1981 1984 1987 1990 1993 1996 1999 2002 2005 2008 2011 2014

PCE Nominal 2-Year Treasury Yield

0.85%

1.68%

1.68%

2.70%

-2%

0%

2%

4%

6%

8%

10%

12%

14%

16%

1977 1981 1984 1987 1990 1993 1996 1999 2002 2005 2008 2011 2014

PCE Nominal 30-Year Treasury Yield

-0.83%

1.02%

-4%

-2%

0%

2%

4%

6%

8%

10%

1977 1981 1984 1987 1990 1993 1996 1999 2002 2005 2008 2011 2014

30-Year Real Treasury Yield

2-Year Real Treasury Yield


Treasury Inflation Protected Securities (TIPS) and Breakeven Yields

-2%

-1%

0%

1%

2%

3%

4%

2002 2006 2009 2012 2015

5-Year 10-Year 30-Year

Source: Federal Reserve. Last data point 3/31/16.


Fixed Income Values in a Quantitative Easing Environment

Source: Bloomberg, BoA Merrill Lynch Data as of 4/8/16.

0

100

200

300

400

500

600

700

800

1988 1991 1994 1996 1999 2002 2004 2007 2010 2012 2015

BA

SIS

PO

INT

S

+ 1 SD

+ 2 SD

- 1 SD

+ 3 SD

+ 4 SD

MEAN

+ 5 SD

170 bps

U.S. Corporate Investment Grade vs. U.S. Treasury

172

-25

25

75

125

175

1998 2001 2004 2006 2009 2012 2015

BA

SIS

PO

INT

S

26 bps

U.S. Agency Mortgages vs. U.S. Treasury

+ 1 SD

+ 2 SD

+ 3 SD

MEAN

- 1 SD

51

0

500

1000

1500

2000

1989 1992 1995 1998 2001 2003 2006 2009 2012 2015

BA

SIS

PO

INT

S

MEAN

+ 2 SD

- 1 SD

+ 3 SD

+ 1 SD

+ 4 SD

703

U.S. High Yield Corporate vs. U.S. Treasury

589

0

500

1000

1500

2000

1997 1999 2002 2004 2007 2009 2012 2015

SP

RE

AD

OV

ER

LIB

OR

+ 1 SD

+ 2 SD

+ 3 SD

- 1 SD

MEAN

590 bps

BB/B Bank Loans Average Spread over LIBOR

+ 4 SD

566.


While Leverage has Increased, Coverage Levels have Remained Strong

Source: Morgan Stanley Research. Data as of 9/30/15

2.5

3.0

3.5

4.0

4.5

2002 2004 2006 2008 2010 2012 2014

Interest Coverage

1.00

2.00

3.00

4.00

5.00

6.00

7.00

1998 2002 2006 2010 2015

HY Gross Leverage

High Yield (All) Commodities Energy Ex-Energy

(x) Forecast


US High Yield Spreads and Defaults

Source: Moody’s and BofA ML US High Yield Index and as of 3/31/16. BofA ML US High Yield Index is a commonly accepted measure of the performance of US high yield bonds. Default rate is

calculated as the amount defaulted over the last twelve months divided by the amount outstanding at the beginning of the twelve-month period.

0.00

5.00

10.00

15.00

20.00

198

8

198

9

199

0

199

2

199

3

199

5

199

6

199

7

199

9

200

0

200

1

200

3

200

4

200

5

200

7

200

8

201

0

201

1

201

2

201

4

201

5

Pe

rce

nt

Defaults OAS

Average:

562 bp

Spread

4.56% Default

Current

OAS

703 bp

Current

Default

Rate:

3.63%


U.S Bank Loan Prices: February 18, 2016B

id P

rice

Source: S&P/LSTA Leveraged Loan Index, as of February 18, 2016.

Sp

rea

d (

Bp

s)


Fixed Income Opportunities in a Quantitative Easing Environment

Emerging Market Corporates Facing Higher Volatility

Source: Bloomberg. Data as of 2/16/16. The BofA ML US High Yield Index and High Yield Emerging Markets Indices are commonly accepted measures of the performance

of U.S high yield and Emerging Markets securities, respectively.

-200

0

200

400

600

800

1000

20

05

20

06

20

07

20

08

20

09

20

10

20

11

20

12

20

13

20

14

20

15

20

16

BA

SIS

PO

INT

S

US High Yield OAS less EM Corporate OAS

+ 1 SD

+ 2 SD

- 2 SD

MEAN =

+ 3 SD

191

146

- 1 SD


2016 Market Outlook

• Developed market sovereigns, including most US government debt, look unattractive.

• Corporate credit offers value. Fundamentals, excluding energy, remain relatively strong. High

yield, including bank loans, offers value with above average spreads and well below average

default rates. Leverage has risen, but coverage ratios remain strong.

• Non-Agency structured credit is attractive, in light of the strong housing and commercial real

estate markets in the US

• Floating rate securities, including structured securities and event-linked (catastrophe) bonds

may be attractive to hedge interest rate risk without too much yield give-up.

• Select emerging market sovereigns may be attractive, reflecting longer term secular positive

credit trends.

• The Dollar should remain cyclically strong as US monetary policy normalizes more quickly

than Europe or Japan.


Agenda

1. Account Update



4. Economic Outlook

5. Appendices


Well-diversified portfolios across issuers, industries, geographies, and

credit qualities

Portfolio Construction

Portfolio Manager

Analyst

TraderCompliance

Risk Management

Industry Factors

• Position in economic cycle

• Cyclical/Non-cyclical/Financials

• Target Industry Weights

Security Selection• Relative value

• Fundamental outlook

• Stability of business plan

Macro Themes & Outlook• Interest rate outlook

• Inflation

• GDP

• Employment


Buy Discipline/ Underwriting

Surveillance

Exposure Management/Sell

discipline

Credit Research ProcessThree Pillars

1. Buy Discipline/Underwriting

• Top down – Sector selection

• Bottom Up – Fundamental credit review

2. Surveillance

• Integrated Global Research Platform

• 27 Credit Analysts

• Boston

• Dublin

• London

3. Exposure Management/Sell Discipline

• Reduce less attractive sectors

• Reduce overvalued issues

• Target spreads achieved

• Increasing fundamental risks

• Changing security fundamentals



• Financial statement analysis

• Company strategy/market position

• Porter’s five forces model

• Financial model

• Capital structure & Indenture analysis

Credit Research Process Buy Discipline/Underwriting

Starts With Relative Value Framework

• Derive intrinsic value

• Comprehensive market data

• Internal Pioneer credit ratings

• Evaluate entire capital structure

• Differentiate between risk & alpha

Objective: Optimize Risk-Adjusted Returns Through Security Selection

Underwriting: Fundamental Credit Review


Energy data points represent energy bonds within the index that have a maturity greater than 3 years. For Illustrative purposes only.


Credit Research Process Surveillance

Proprietary Global Research Platform

• Analyst coverage list

• Recommendation

• Pioneer credit ratings

• Fundamental momentum

• Downgrade risk

Objective: Active Monitoring of Fundamental Credit Risk

• Investment thesis

• Analysis to support internal rating and downgrade risk

• Quarterly earnings review

• Quarterly sector reviews

Issuers on Active Coverage List

For illustrative purposes only as an example of our credit research process


Agency Mortgage Valuation Models

Sector Allocation

Security Selection

Investment Decision

Buy/Sell/Avoid

Compares fair value of agency mortgages. Includes:

• Treasury yields and curve shape

• Swap spreads

• Implied volatility

• Coupon

• Mortgage prices

Compares risk of structured mortgage securities.

Factors focus on:

• Interest rate volatility

• Prepayment model risk

• OAS

• Agency spreads

• Spread duration

• Convexity

• Refinance sensitivity



Surveillance

Exposure Management/Sell

discipline

Structured Product Research ProcessThree Pillars

1. Buy Discipline/Underwriting

• Top down – Sector selection

• Bottom Up – Collateral, Structure

Analysis and Stress Runs

2. Surveillance

• Credit Surveillance done monthly

post remittance report

3. Exposure Management/Sell Discipline

• Reduce less attractive/over-valued sectors

• Reduce overvalued issues

• Relative spreads tighter than warranted

• Increasing fundamental risks

• Changing security credit metrics/structure


• Collateral Metrics

• Total Structural Analysis

• Originator/Sponsor Evaluation

• Servicing capabilities

• Priority of Payments

Structured Product Research Process Buy Discipline/Underwriting

Starts With Relative Value Framework

• Structured Product vs. Corporate

• Collateral trends and performance

• Evaluate Value vs. like structures

• Evaluate liquidity prospects

Objective: Optimize Risk-Adjusted Returns Through Security Selection

Underwriting: Collateral & Structure Analysis


Source: Barclays Live. As of March 2016.


Structured Product Research Process Surveillance

Quantitative and Qualitative Information

• Month over month changes and trends

• Adjust modeling assumptions

• Review Morningstar Analysis (CMBS)

• Re-evaluate value

• Hold/Sell Decision

Objective: Active Monitoring of Credit Risk vs Market Price

• Delinquent and Special Serviced Loans

• Credit Enhancement and Interest Shortfalls

• Loan Modifications and Timelines

• Ratings

Key Structured Product Surveillance Data

For illustrative purposes only as an example of our credit research process


Biographies

KENNETH J. TAUBES – Executive Vice President, Chief Investment Officer, U.S.

Joined Pioneer: 1998

Investment Experience: Since 1983

Ken Taubes is Chief Investment Officer at Pioneer Investment Management USA,Inc., the U.S. investment division of Pioneer Investments. He is Lead

Portfolio Manager on the Opportunistic Core and Multi-Sector Fixed Income strategies. He is also a Portfolio Manager on the Multi-Asset Real Return

strategy. Ken also oversees the equity and fixed income portfolio management and research analyst staff in the U.S. and is chairman of the U.S.

Investment Committee, a member of the Global Investment Committee, and a member of the U.S. Management Committee. He is a member of the

Board of Trustees of the Pioneer Funds, which oversees Pioneer’s U.S. registered portfolios.

Prior to joining Pioneer Investments in 1998, Ken spent seven years with Putnam Investments in Boston, most recently as senior vice president and

senior portfolio manager for over $15 billion in fixed income assets for more than 30 institutional accounts and 15 open-end mutual funds. Ken Taubes

also served as Senior Vice President and corporate treasurer of Home Owners Savings Bank in Boston, New England’s largest thrift holding company

and one of the nation’s largest mortgage banks, where he worked from 1986 to 1990. He began his career in 1980 with Bank of New England as a

treasury officer in the bank’s international treasury division.

He holds a BS in accounting from Syracuse University’s Utica College (1980) and a MBA from Suffolk University (1985).

ANDREW FELTUS, CFA – Senior Vice President , Director of High Yield & Bank Loans, Portfolio Manager



Andrew Feltus is Senior Vice President, Director of High Yield and Bank Loans and Portfolio Manager, based in Boston. He is lead Portfolio Manager of

the Global High Yield and U.S. High Yield Institutional and a co-Portfolio Manager of the U.S. High Yield and Multi-Sector Fixed Income strategies. He is

also co-Portfolio Manager for Pioneer Dynamic Credit strategy. He has extensive experience managing a wide range of debt securities globally, including

emerging markets and foreign exchange, and has previously managed money market portfolios.

Andrew joined Pioneer Investments as a Fixed Income Analyst and was promoted to Portfolio Manager in 2001. Prior to joining Pioneer, he worked on

the bond desk at Massachusetts Financial Services. Andrew has been actively managing U.S. fixed income portfolios since 1994, and managing

derivatives (primarily bond futures – since 1992, currency forwards – since 1994, and credit default swaps – since 2008) which are used in a number

of portfolios under his management.

He holds a BA in quantitative economics and philosophy from Tufts University (1991). He is a CFA® charterholder.


Biographies (Cont’d.)

CHARLES MELCHREIT, CFA – Senior Vice President, Director of Investment Grade and Portfolio Manager



Charles Melchreit is a Senior Vice President, Director of Investment Grade and Portfolio Manager, based in Boston. He is a co-Portfolio Manager on the

Opportunistic Core, Global Multi-Sector and Multi-Sector Fixed Income Strategies. He is also a Portfolio Manager on the Multi-Asset Ultrashort Income

strategy. Charles specializes in structured securities as well as developing analytic methods and tools to enhance portfolio management processes.

Prior to joining Pioneer, he worked with Cigna Investment Management where he managed an ABS and mortgage-backed portfolio. Previously, Charles

worked for ING Aeltus, where he managed Aeltus’ Mortgage Group and Quantitative Research effort. His responsibilities included oversight of portfolio

managers pursuing government and structured securities strategies, management of dedicated MBS/ABS portfolios, analysis and trading of fixed

income derivatives, and leading a quantitative research team that focused on development of proprietary valuation and risk management tools. He has

also worked in the Quantitative Management Group at MassMutual (now part of Babson Capital), where he was responsible for research in the area of

mortgage-backed securities. Charles began his investment career in 1986 the Investment Department at Aetna Life and Casualty, where he was a

quantitative investment analyst and later Head of Quantitative Research. In those roles, he was responsible for portfolio optimization and investment risk

management; product development, including LDI and portfolio insurance strategies; development of proprietary investment systems; and research in

rate forecasting and prepayment behavior. Currently, he has implemented derivatives positions at Pioneer which include duration and curve

management strategies using futures and swaps.

He holds a BA in Economics (1982) and a MA in Statistics (2005) both from Yale University, as well as a MSc in Management from Sloan School of

Management, MIT (1984). He is CFA® charterholder.

MEREDITH BIRDSALL, CFA – Senior Client Portfolio Manager


Industry Experience: Since 1982

Meredith Birdsall is a Senior Client Portfolio Manager supporting the U.S. fixed income team. She covers all of Pioneer’s U.S. fixed income strategies.

Meredith has been involved in the investment industry for over twenty years.

Before joining Pioneer, Meredith was a fixed income product engineer and portfolio manager at State Street Global Advisors, specializing in credit

products, including high yield and investment grade debt. Her prior roles included consulting to endowments and other institutional investors at Hirtle,

Callaghan & Co , as well as managing the firm’s private equity and hedge fund programs. She also was a Vice President in corporate finance and mergers

and acquisitions at Drexel, Burnham Lambert, focusing on structuring financings for leveraged acquisitions and leveraged buyouts.

Meredith received both her bachelor and MBA degrees from Harvard University and is a CFA® charterholder.


Biographies (Cont’d.)

CRAIG DEGIACOMO – Senior Vice President, Director of Relationship Management


Industry experience: Since 1994

Craig is Senior Vice President, Director of Relationship Management for Pioneer Investments. Prior to joining the firm in 2011, Craig was the team leader

of Public Fund and Taft-Hartley Sales at State Street Global Advisors (SSgA), which was responsible for selling SSgA's suite of institutional strategies to the

public fund and Taft-Hartley marketplace in the United States. Prior to that, Craig was a Senior Relationship Manager, where he was responsible for

managing relationships within SSgA's existing public fund client base. Craig has also worked as a member of the Active International Equity investment

team. He was responsible for investment management, research, product development, and positioning for International strategies. Before that, Craig

was an Operations Manager for SSgA's Global Structured Products Group, where he was responsible for overseeing Investment Operations for developed

and emerging markets. Prior to joining SSgA in 1996, Craig worked in State Street Corporation's Public Funds Division.

Craig holds an MBA from the Carroll School of Management at Boston College with a concentration in Finance and received a Bachelor of Science degree

from Providence College. Additionally, he is a member of the International Foundation of Employee Benefit Plans (IFEBP).

MICHAEL DIRSTINE, CFA, CAIA – Senior Vice President, Institutional Business Development Officer


Industry experience: Since 1991

Michael Dirstine is Senior Vice President and Institutional Business Development Officer based in Boston.

Before joining Pioneer, Michael was Vice President of Institutional Sales at Eaton Vance where his focus strategies included senior floating-rate loan, high yield, multi-

sector and investment grade bond, global macro and emerging market debt and equities. Before joining Eaton Vance, Michael was Vice President, Mid-West Team

Leader at State Street Global Advisors. Michael was also Vice President of Institutional Sales for seven years at State Street. Before joining State Street, Michael was

Vice President of Corporate Finance at Putnam Investments.

Michael has a B.S. in Management with a concentration in Finance from the University of Massachusetts, Boston, and a M.S. in Finance from Boston College. Michael

holds CFA® and CAIA designations.


Endnotes

PerformanceThe performance data quoted represents past performance, which is no guarantee of future results. Current performance may be lower or higher than the performance data quoted above. Returns are in US$.

Characteristics/HoldingsThe portfolio is actively managed; sector allocations will vary over other periods and do not reflect a commitment to an investment policy or sector.

Portfolio Security Holdings and Sector Allocations will vary over time and should not be considered as security purchase or sale recommendations.

*Diversification does not guarantee a profit or protect against a loss.

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