American Fund's Investment Portfolio: Company Breakdown

The American Funds Investment Company of America (AIVSX) is a large-blend stock fund that offers dozens of traditional mutual funds, as well as a large selection of portfolio and target funds. The company has a long history, dating back to 1931, and is known for its focus on capital preservation and consistent long-term performance. With a combination of individual accountability and teamwork, American Funds seeks to provide investors with a spectrum of investment objectives, volatility levels, and asset types. The company's funds are actively managed and known for their higher fees compared to competitors like Vanguard. As of May 2023, American Funds Investment Company of America (AIVSX) had a total asset under management (AUM) of $110.45 billion, with 86% of its assets invested in U.S. equities.

American Funds Investment Company of America (AIVSX)

The American Funds Investment Company of America (AIVSX) is a large-blend stock fund that has been in operation since 1934. It is a subsidiary of Capital Group and offers a range of traditional mutual funds, portfolio funds, and target funds. AIVSX has a three-star Morningstar rating and a total asset under management (AUM) of $110.45 billion as of May 2023, with 75% of its portfolio invested in large-cap stocks.

The fund primarily focuses on American holdings, with 86% of its assets in US equities, 8.4% in non-US equities, and the remainder in cash and US bonds. The top two sectors of the fund are information technology and healthcare, comprising 18.6% and 14% of the fund's net assets, respectively, as of March 31, 2023.

AIVSX's investment strategy involves investing in a diverse group of large, well-established companies across the United States, with a long-term focus on future income rather than high current yield. The fund's top equity holdings include General Electric (3.8%) and Meta Platforms, formerly Facebook (2.4%), as of April 30, 2023.

The fund's longest-serving managers, James Lovelace and Donald O'Neal, have been with the fund for nearly three decades and are supported by seven other fund managers. As of May 31, 2023, AIVSX had a one-year return of 4.57%, a five-year average return of 8.78%, and a ten-year average return of 10.48%.

Overall, the American Funds Investment Company of America (AIVSX) offers a combination of growth and income to investors, with a focus on large, well-established companies and a long-term investment strategy.

American Funds SMALLCAP World (SMCWX)

As of 23 October 2024, the fund's price at NAV was $68.75, with total assets of $77.07 billion and an expense ratio of 1.060%. The fund has delivered a 1-year return of 21.01% with sales charge and 14.06% without, and an annualised 10-year return of 8.47% with sales charge and 7.83% without.

The fund's top sectors by percentage of net assets as of 30 September 2024, are consumer discretionary (18.8%), information technology (15.7%), consumer staples (3.2%), and communication services (2.4%).

Some notable investments by the fund as of January 2024 include Tube Investments of India, Comfort Systems USA Inc, Molina Healthcare Inc, Ares Management Corp Ordinary Shares - Class A, and Insight Enterprises Inc.

Growth Fund of America (AGTHX)

The Growth Fund of America (AGTHX) is a mutual fund that seeks to provide growth of capital by investing primarily in common stocks in companies that offer superior opportunities for growth. The fund takes a flexible approach to growth investing, seeking opportunities in traditional growth stocks, cyclical companies, and turnarounds with significant growth potential. It may also invest in convertibles, preferred stocks, U.S. government securities, bonds, and cash equivalents. The fund's investment objective is to provide investors with growth of capital.

As of November 27, 2023, the fund had assets totaling almost $214.32 billion invested in 358 different holdings. Its portfolio consists primarily of U.S. stocks, making up more than 80% of the portfolio, with consumer cyclical, technology, and healthcare forming the bulk of equities. Amazon, Gilead Sciences, and Comcast are among the top three holdings. Non-U.S. equities make up about 10% of the portfolio, while U.S. bonds and non-cash equivalents are just over 7.5%.

The fund has a large number of managers, each employing different strategies and asset classes within the fund. As of 2024, the fund is managed by Donnalisa Parks Barnum, Barry Crosthwaite, J. Blair Frank, Gregg Ireland, Carl Kawaja, Michael Kerr, Ronald Morrow, Donald O'Neal, Martin Romo, James Rothenberg, James Terrile, and Bradley Vogt. The fund has returned 13.69% over the past year, 4.60% over three years, 9.77% over five years, and 10.60% over the past decade.

The Growth Fund of America (AGTHX) is rated as a "core" player in an investment portfolio by Morningstar, which calls it an "excellent choice to anchor the growth portion of a portfolio." The fund has a Morningstar Risk Rating of average for its category and an expense ratio of 0.63%.

American Funds Fundamental Investors (ANCFX)

The American Funds Fundamental Investors fund falls into Morningstar's large-blend category. The fund's managers primarily invest in the largest segment of the U.S. stock market based on market cap. The fund may invest up to 35% of its portfolio's assets outside of the United States. As of November 27, 2023, the fund had assets totalling almost $115.19 billion invested in 263 different holdings. The fund's holdings include Microsoft, Amazon.com, Broadcom, Philip Morris International and Comcast.

The fund's investment objective is to achieve long-term growth of capital and income. With an emphasis on growth over income, the strategy seeks undervalued and overlooked opportunities. It invests in companies with high-quality products and leading market shares with underappreciated potential for growth in sales, earnings and dividends.

The fund primarily invests in common stocks or securities convertible into common stocks, bonds, U.S. government securities and cash. It may invest up to 5% of assets in debt securities rated Ba and BB or below (or unrated but determined to be of equivalent quality).

As of September 30, 2024, the fund's assets totalled $141,825.6 million. The fund had a 1-year return of 37.17%, a 5-year return of 14.68% and a 10-year return of 12.15%. The fund's expense ratio is 0.60%.

The fund is team-managed by eight individuals who have been with the fund for varying lengths of time, ranging from 6 to 35 years. This is typical of the team approach used by the various funds in the American Funds family.

American Funds' portfolio and target funds

American Funds, a subsidiary of Capital Group, offers a wide range of investment options, including portfolio and target funds. These funds are known as "funds of funds" as they invest in traditional mutual funds rather than individual securities. Here is an overview of American Funds' portfolio and target fund offerings:

American Funds Portfolio Series

The American Funds Portfolio Series provides investors with a range of investment objectives, volatility levels, and asset types to choose from. This series includes funds such as the Growth-and-Income Funds, Tax-Exempt Bond Funds, and the American Funds Global Balanced Fund. Each fund within this series has a specific investment strategy, allowing investors to align their investments with their financial goals.

American Funds Retirement Income Portfolio Series

This series of target funds is designed for investors seeking stable income during their retirement years. These funds aim to provide consistent returns with a focus on capital preservation. The funds in this series may invest in a mix of dividend-paying stocks, bonds, and other fixed-income securities to generate steady income for retirees.

American Funds Target Date Retirement Series

The Target Date Retirement Series offers funds that are tailored to investors' planned retirement dates. These funds automatically adjust their asset allocation over time to become more conservative as the target retirement date approaches. This series is suitable for investors who want a hands-off approach to saving for retirement, as the funds are managed according to a predetermined glide path.

American Funds College Target Date Series

Similar to the Target Date Retirement Series, the College Target Date Series helps investors save for future college expenses. These funds are designed to accumulate wealth over time, gradually shifting from higher-risk, higher-return investments to more conservative options as the target date for college expenses approaches.

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