A time-honoured system is reassuring in a time of volatility

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26 September 2022
| By Capital Group |
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Doing one thing, and one thing only for more than eight decades tends to make any organisation rather good at that one thing.

And as a global active investment manager, we’ve helped investors succeed by remaining true to our values and approach.

This type of active focus enables ideas and processes to be tested and validated; it helps identify your own decision-making strengths and weaknesses; it builds resilience to noise that comes from periodic volatility; it enables an organisation to adapt to evolving client needs; and it inspires them to remain committed and actively focused on that one thing.

This has been Capital Group’s sole, focus since the 1930s; bottom-up, research-driven, active-only investing.

Today, Capital Group is a global leader in investing, working with financial intermediaries and institutions to manage more than US$2.2 trillion1 in long-term assets for investors around the world across multi-asset, equity and fixed income strategies.

A major part of what makes Capital Group a global leader in investing is its investment approach – the Capital SystemSM. It has been a highly successful investing approach for more than 60 years, bringing together the best minds in investing to deliver robust ideas that drive investment results.

Rather than relying on the ideas, preferences and decisions of one or two key portfolio managers, the Capital System taps the intelligence of many; each individual acting independently, with conviction and according to their personal experience and insight. While managers collaborate and share insights, each invests independently according to their strongest convictions.

The resulting portfolios are a diverse collection of investment ideas, not just one manager’s perspective. This approach creates the potential for portfolios to fare well in a variety of market conditions.

In addition, while at most investment firms analysts only recommend investments, at Capital Group they typically have the opportunity to actually invest in their highest conviction ideas. Most Capital Group funds have a portion of fund assets, called the Research Portfolio, managed by a group of investment analysts.

Capital Group’s investment approach enables it to utilise the power of diversity to navigate near-term noise and periods of volatility and economic and market uncertainty.

This combination of independent high-conviction decision making and the diversity that comes from multiple perspectives has brought about sustainable benefits to investors and advisors.

 

  • Resilience. Capital Group’s track record of consistent long-term results over decades is enduring. It’s an investment approach that has delivered a smoother ride and higher downturn resilience to investors, time and time again.
  • Stability. As fund managers have come and gone, Capital Group has quietly taken and maintained the lead. The Capital System takes succession planning to the next level, taking key-person risk out of the picture and safeguarding investment results over decades of market cycles. 
  • Opportunity. Capital Group delivers a wealth of global investment ideas to its clients, exploring diverse opportunities from multiple perspectives, enhancing the potential for investors to profit from a wide, global investment universe.

 

As one of the largest active investment managers in the world, Capital Group connects investors and advisors with superior investment ideas, drawn from its extensive research network. With an integrated research network of more than 450 investment professionals operating from the major investment jurisdictions around the world, Capital Group, quite literally, can lay claim to having authentic “investment boots on the ground”.

These resources are actively focused on tracking down the best investment opportunities, beyond corporate offices and investor briefings. They examine and experience developments in factories, villages, laboratories, shopping districts, new residential areas and more. This type of “bottom-up” research goes deep and broad, exploring economies on the ground, from start-ups to the next multinational corporation.

It also means attending thousands of company meetings every year2, all for the sole purpose of finding the best companies and securities to invest in that will build long-term wealth for investors.

Capital Group believes that a financial goal is more than just a number. This belief has underpinned its unrelenting 90-year-plus focus on delivering superior long-term results, to safeguard the future wealth of investors, who take confidence in Capital Group’s track record and benefit from the quality of its research and ideas.

 

Data as at 31 December 2021, unless otherwise stated. Source: Capital Group  

  1. As at 30 June 2022.
  2. Capital Group investment professionals conducted more than 22,000 company meetings in 2021.

The Capital Group companies manage equities through three investment divisions that make investment and proxy voting decisions independently. Fixed income investment professionals provide fixed income research and investment management across the Capital organisation; however, for securities with equity characteristics, they act solely on behalf of one of the three equity investment groups.

 

FOR PROFESSIONAL INVESTORS AND INFORMATION PURPOSES ONLY

The value of investments and income from them can go down as well as up and you may lose some or all of your initial investment. Past results are not a guarantee of future results.

This material is of a general nature, and not intended to provide investment, tax or other advice, or to be a solicitation to buy or sell any securities. This communication has been prepared by Capital International, Inc., a member of Capital Group, a company incorporated in California, United States of America. The liability of members is limited. In Australia, this communication is issued by Capital Group Investment Management Limited (ACN 164 174 501 AFSL No. 443 118), a member of Capital Group, located at Level 18, 56 Pitt Street, Sydney NSW 2000 Australia.

© 2022 Capital Group. All rights reserved.

Capital Group
Capital Group

Since 1931, we've helped millions of investors worldwide pursue their real-life goals. ...

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