We believe in a distinctive way of managing money.  

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THE CAPITAL SYSTEM

Our system prioritizes superior and repeatable fund results.

Jonathan Bell Lovelace 1968

Early in Capital Group history, our leaders realized that their funds would outlast the professionals who managed them.      


They believed they had a responsibility to provide stability and management continuity to their investors, so they asked themselves a key question: If a portfolio manager left the firm, how could they keep funds going strong?  

They pioneered a plan. By dividing funds into sections and giving each of the existing managers a portion to administer, no fund would be too dependent on a single person.   

This distinctive way of managing money became The Capital System. By incorporating the highest conviction investment ideas of each manager in a fund, we aim to both increase the diversity of those ideas and reduce the volatility of a fund, which can give investors a smoother ride in bumpy markets.  



The best of both worlds.

CRMC Meeting 1961. Jonathan Bell Lovelace,
Chuck Schimpff, Coleman Morton, Jim Fullerton, Mary Bauer

The Capital SystemSM can give advisors and investors the best of both worlds: the upside of high-conviction ideas and the power of collaboration.       


At Capital Group, home of American Funds, we assemble teams of managers who have different investing styles and complementary strengths to help foster a diversified investing approach.

The benefits of our multimanager approach can be boiled down to simple math: If a typical mutual fund has a star manager with 120 of her best ideas for investments, that’s a lot of ideas for one person to track. But imagine if the fund were divided among four managers, including each of their 30 highest conviction ideas — ideas they've explored inside out — that’s The Capital System.  


A history lesson. 

For decades, many of our funds have delivered strong results, helping investors stay on the path to achieving their financial goals.    


Take a look at the results of a $10,000 hypothetical investment in the S&P 500, as well as each of the five U.S. equity-focused American Funds available when the first S&P 500 index-tracking fund was founded in 1976.

Click for more information on the results of our equity, fixed income and multi-asset funds.

Class F-2

Source: Capital Group, using data obtained from Morningstar. $10,000 hypothetical investment in five U.S. equity-focused American Funds and the S&P 500, from August 31, 1976, through December 31, 2018. The market indexes are unmanaged and, therefore, have no expenses. Investors cannot invest directly in an index. There may have been periods when the results lagged the index(es).


Aim for a smoother ride.

A group of managers with complementary investing styles on a single fund can diversify risk, which is part of what has made our funds generally less volatile in down markets.      


Losing less when the market dips means investors stand to gain more when it climbs. And a steadier journey can help investors stay the course for the long term.  

Take a look at these examples of market downturns from recent history. You can see that the U.S. equity-focused American Funds didn't drop as much as the index, on average. 

Class F-2

The U.S. equity-focused American Funds in these analyses include: AMCAP Fund, American Mutual Fund, Fundamental Investors, The Growth Fund of America, The Investment Company of America, The New Economy Fund and Washington Mutual Investors Fund. The investment was rebalanced monthly.

Source: Capital Group calculations based on Capital Group and Morningstar data, as of 12/31/2018. All comparisons are with each fund’s primary or secondary benchmarks as disclosed in the fund’s most recent prospectus. The market index is unmanaged and, therefore, has no expenses. Investors cannot invest directly in an index. There may have been periods when the results lagged the index(es).

The $10,000 hypothetical investment in the line chart is based on daily returns. The S&P 500 values are calculated using the total return index, which includes dividends. The equal-weighted blended average of the seven U.S. equity-focused American Funds includes AMCAP Fund, American Mutual Fund, Fundamental Investors, The Growth Fund of America, The Investment Company of America, The New Economy Fund and Washington Mutual Investors Fund. The investment was rebalanced monthly. Dates shown for market highs and lows are based on the price return of the unmanaged S&P 500 Index, which does not include reinvested dividends. The total percentage loss from high to low shown for the index and American Funds averages are calculated using these dates and based on total returns, which include reinvested dividends. For each of the bear markets shown, the Days to Recovery for the S&P 500 Index and American Funds equal-weighted blended average reflect the number of calendar days (including weekends and holidays) between the stated market low and the next time the value of the investments for each met or surpassed the value set at the pre-downturn market high. 


Built to last.

The Capital System has stood the test of time.


An innovative idea then and now, our distinctive multimanager system has become a defining feature of our success. Distinct in the market and diverse in its strategy, The Capital System has helped many of our investment vehicles generate superior outcomes. 

Capital Group has managed investment strategies through funds and other vehicles over the years, the results of which have varied.

Click for more information on the results of the American Funds equity, fixed income and multi-asset funds.

A long-term perspective can really pay off. Take a look at how an initial investment of $10,000 grew over 84 years, despite market ups and downs. 

Class F-2

1Includes dividends of $45,282,202, and capital gain distributions totaling $95,798,465, reinvested in the years 1936–2018.

2Includes reinvested capital gain distributions of $9,258,017, but not income dividends totaling $4,652,617 taken in cash.

Source: Capital Group. The market indexes are unmanaged and, therefore, have no expenses. Investors cannot invest directly in an index. There may have been periods when the results lagged the index(es).

The stock market is represented by Standard & Poor’s 500 Index, a market capitalization-weighted index based on the results of approximately 500 widely held common stocks. The index is unmanaged and, therefore, has no expenses.

Our beliefs

Your goals power ours.

We have four core beliefs central to helping you succeed.

More beliefs

Build a more personal portfolio.

Your clients need portfolios as individual as they are. Our portfolio construction approach lets you customize a mix that works with the individual goals of your clients.

Figures shown are past results and are not predictive of results in future periods. Current and future results may be lower or higher than those shown. Share prices and returns will vary, so investors may lose money. Investing for short periods makes losses more likely. View fund expense ratios and returns

Returns shown at net asset value (NAV) have all distributions reinvested.

Investments are not FDIC-insured, nor are they deposits of or guaranteed by a bank or any other entity, so they may lose value.

Investors should carefully consider investment objectives, risks, charges and expenses. This and other important information is contained in the fund prospectuses and summary prospectuses, which can be obtained from a financial professional and should be read carefully before investing.

Investment results assume all distributions are reinvested and reflect applicable fees and expenses. When applicable, investment results reflect fee waivers and/or expense reimbursements, without which the results would have been lower. Read details about how waivers and/or reimbursements affect the results for each fund. View results and yields without fee waiver and/or expense reimbursement.

Investing outside the United States involves risks, such as currency fluctuations, periods of illiquidity and price volatility, as more fully described in the prospectus. These risks may be heightened in connection with investments in developing countries.

Small-company stocks entail additional risks, and they can fluctuate in price more than larger company stocks.

The return of principal for bond portfolios and for portfolios with significant underlying bond holdings is not guaranteed. Investments are subject to the same interest rate, inflation and credit risks associated with the underlying bond holdings. Lower rated bonds are subject to greater fluctuations in value and risk of loss of income and principal than higher rated bonds. 

Fund results for periods before a share class was sold are hypothetical. These hypothetical returns were calculated by adjusting Class A share results without a sales charge for the difference between the Class A share expense ratio and the estimated expense ratio for the share class as of the date of first sale. View dates of first sale and specific expense adjustment information.

Regular investing does not ensure a profit or protect against loss. Investors should consider their willingness to keep investing when share prices are declining.

Statements attributed to an individual represent the opinions of that individual as of the date published and do not necessarily reflect the opinions of Capital Group or its affiliates. This information is intended to highlight issues and should not be considered advice, an endorsement or a recommendation.

Standard & Poor’s 500 Composite Index is a market capitalization-weighted index based on the average weighted results of approximately 500 widely held common stocks.

The S&P 500 Index is a product of S&P Dow Jones Indices LLC and/or its affiliates and has been licensed for use by Capital Group. Copyright © 2019 S&P Dow Jones Indices LLC, a division of S&P Global, and/or its affiliates. All rights reserved. Redistribution or reproduction in whole or in part is prohibited without written permission of S&P Dow Jones Indices LLC.

© 2019 Morningstar, Inc. All rights reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results. These numbers were calculated by the Capital Group based on underlying Morningstar data.

This content, developed by Capital Group, home of American Funds, should not be used as a primary basis for investment decisions and is not intended to serve as impartial investment or fiduciary advice.

All Capital Group trademarks are registered trademarks owned by The Capital Group Companies, Inc. or an affiliated company. All other company and product names mentioned are the trademarks or registered trademarks of their respective companies.

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

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