BY UE STUDIO

Wednesday, October 13, 2021 - 16:31

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Capital Group, the world's largest active fund manager1 was born in California in 1931, just two years after the crash of 29, a financial disaster that shook the world economy.

At that time, Jonathan Bell Lovelace, seasoned in the 1920s in an investment firm in Detroit, the Silicon Valley of the time, decided to found a management company that was very clear about its objective: to improve people's lives through an investment. of success.

To achieve this, Capital Group was created taking into account several very clear pillars:

  • A long-term sustainable approach

  • A singular approach to offer its clients the best global investment opportunities through active management

  • The Capital System - its unique approach to active management, designed to deliver superior results to clients

The company's approach is based on in-depth analysis of the companies in which it invests.

Together, these solid principles have allowed the firm in these 90 years to become an institution that at the end of June of this year managed more than 2.6 trillion dollars and served more than 55 million clients throughout the world.

The key question is how Capital Group has managed to overcome the obstacles that have arisen in these nine decades.

It should not be forgotten that, throughout this time, the world has faced multiple crises, financial and of all kinds, events such as World War II and recently, the Covid pandemic.

Mario González, co-head of business development at Capital Group Iberia

The key is Capital Group's distinctive investment process - the Capital System, which seeks to combine the benefit of seasoned investment professionals acting on their core convictions, while limiting the risks involved in making isolated decisions. . The management of a portfolio is divided between a series of carefully selected managers, each chosen to complement the investment styles of the other members of the team. By incorporating the most compelling investment ideas of each manager into a portfolio, Capital Group aims to both increase the diversity of those ideas and reduce the volatility of a fund, which can provide investors with a smoother ride in busy markets. As a pioneer of industry standards for analytics,the company's extensive analytical capabilities add depth to the Capital System.

"Through our Capital System we approach active management in a different way, providing investors with the power of collaboration and diversity of thought within our investment teams, always investing with high conviction", describes Mario González, co-director of Capital Group for Iberia.

Complementary teams in their visions

This distinctive approach to investing makes it clear that "we do not believe in star managers. Experience has taught us that no manager can consistently do well in every market cycle. Therefore, our investment process is based on having teams investment teams are very experienced and complementary in their views. This process provides us with many benefits, including the opportunity for greater consistency through market cycles, "says Álvaro Fernández, the other co-director of Capital Group for Iberia.

Álvaro Fernández, co-head of business development at Capital Group Iberia

The firm is also differentiated by the high experience of the teams. "Our managers have an average of 27 years of experience in the sector and this is something unique in the asset management industry. They invest together with our clients in the funds they manage. It is this co-investment that makes them fully aligned with the long-term interests of our investors, "says Mario González.

In addition, investment professionals are remunerated based on the results of their investments over a long-term horizon (eight, five, three and 1 year and in this order of importance), which allows them to commit to producing results of consistent long-term investment.

"Our investment strategies are broad and long-lasting rather than based on short-term trends, supported by our own exhaustive analysis process," adds Álvaro Fernández.

A total of 32 vehicles in Europe

As a private company, Capital Group benefits from its long-term focus, and this has been a key factor for its organic growth: it has not participated in any acquisitions or corporate operations, keeping external pressures at bay.

With operations established in Spain for almost seven years, the entity currently offers 32 UCITS funds domiciled in Luxembourg and available to Spanish investors.

The success story that is Capital Group has earned it different recognitions.

Among the most recent, the company has been named by Morningstar 'Best Fund Manager: Fixed Income' in 2021 for Spain.

Additionally, Broadridge's independent panel of fund selectors ranked the company as the fourth strongest asset management brand globally in its 2021 Fund Brand 50.

* As of December 31, 2020. Source: Morningstar

Although Capital Group makes reasonable efforts to obtain information from third party sources that it believes to be reliable, it does not guarantee the accuracy, reliability or completeness of the information.

This communication is not intended to be exhaustive or to provide investment, tax or other advice.

Made by UE Studio

This text has been developed by UE Studio, creative firm of branded content and content marketing of Unidad Editorial, for Capital Group.

According to the criteria of The Trust Project

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