Capital Group Portfolio Construction
Today’s portfolio construction tools were built upon 60 years of Nobel Prize-winning academic research that has proven its worth to investors. That evolution continues, and we invite you to work with us to expand your thinking around portfolio construction.
The Capital Group Approach to Portfolio Construction
We believe that objective-based portfolio construction, using flexible funds, provides better investor outcomes. Our philosophy places real-life goals front and center, and seeks to address a broader set of risk factors than traditional methods of portfolio construction.
Aligned With Real-Life Goals
The biggest risk to any portfolio is failing to meet the client’s goal. Traditional methods have their place, but an objective-based focus may help further address that risk and create better outcomes.
An Expanded View of Risk
When you place client goals at the center of your thinking around risk, you can broaden your definition of risk itself — and create portfolios that help increase the chances for long-term success.
Objective-Based Investing Risk Factors
Flexible Investments With Superior Results
The foundation of our portfolio construction is the American Funds — equity investments with superior results over a number of periods and the flexibility to pursue objectives across asset classes and geography.
Investment Management Success Rate
Our U.S.-Focused Equity Funds, on Average, Have a History of Outpacing the Market
Average returns for monthly rolling one-, three-, five- and 10-year periods for the 20 years ended December 31, 2016
Objective-Based Portfolios Compare Well to Index Blends
Flexibility can deliver better results, as seen in this 20-year illustration where we’ve placed a combination of our flexible, objective–based funds up against a simple index blend and a fine-tuned style-box index blend.
Ending Value of Hypothetical $100,000 Investment Over 20 Years Ended March 31, 2017
Portfolios for Every Investor
From global growth to preservation, the American Funds model portfolios span the range of potential client goals and risk profiles, and are built by portfolio managers with decades of experience.
Guided by Objectives That Align With Goals-Based Wealth Management
Equity and Volatility Profile for the American Funds Model Portfolios Each of these models carefully weighs asset allocation against volatility in the pursuit of objectives.
F-3 Shares as of 3/31/17
1Since the inception date of the youngest underlying fund within the models.
Models in Your Practice
These model portfolios can be a solution for some clients, or a starting point for others.
- Using a model, when appropriate, can save effort and allow you more time to interact with your clients.
- Flexibility inherent in these models helps in asset allocation over market cycles.
A Team of Proven Portfolio Managers
Our Portfolio Oversight Committee consists of seven portfolio managers with an average of 29 years’ investment experience. They collectively manage more than $90 billion in assets, and their knowledge of the underlying funds informs their portfolio construction efforts, supported by intensive research.