Capital Group
 |
|
| Private | |
| Industry | Financial services |
| Founded | 1931 |
| Founder | Jonathan Bell Lovelace |
| Headquarters | Los Angeles, California, United States |
|
Area served
|
Worldwide |
|
Key people
|
Capital Group Management Committee: Tim Armour Kevin Clifford Phil de Toledo Darcy Kopcho Rob Lovelace Martin Romo Brad Vogt |
| Products | Mutual fund, Private wealth management, Private equity investing, Retirement plan services |
| AUM |
 US$ 1.5 trillion (2017) |
|
Number of employees
|
7,000+ (December 31, 2015) |
| Subsidiaries | Capital World Investors Capital Research Global Investors Capital International Investors Capital Research and Management Company |
| Website | thecapitalgroup |
Capital Group is an American financial services company. It ranks among the world’s oldest and largest investment management organizations, with $1.5 trillion in assets under management. Founded in Los Angeles, California in 1931, it is privately held and has offices around the globe in the Americas, Asia, Australia and Europe.
Capital offers a range of products, including more than 40 mutual funds through its subsidiary, American Funds, as well as separately managed accounts (or collective investment trusts), private equity, investment services for high net worth investors in the U.S., and a range of other offerings for institutional clients and individual investors globally.
Capital Group's investment philosophy, based on bottom-up portfolio management and rigorous research to drive long-term investment results, has been consistent since the company was founded. The firm is known for its long-term focus and research-based approach and maintains a large research team that develops proprietary insights into investment decisions. The Capital Group companies manage equity assets through three investment groups that make investment and proxy voting decisions independently.
In 1931, Jonathan Bell Lovelace founded the investment firm, Lovelace, Dennis & Renfrew, which would eventually become Capital Group. Lovelace had previously been a partner in the stock brokerage firm E.E. MacCrone, where he explored the concept of developing an open-end mutual fund. He eventually sold his stake in that company, just prior to the Wall Street Crash of 1929.
In 1933, Lovelace’s firm took over management of The Investment Company of America, which he had launched at E.E. MacCrone in 1927. For the next 20 years, his firm enjoyed modest success. As mutual funds gained in popularity in the 1950s, Capital’s roster of mutual funds grew.
The International Resources Fund, established in 1954, was Capital’s first foray into international investing. A year earlier, Lovelace had established an international investment staff at the urging of his son, Jon Lovelace, Jr. The establishment of the firm’s first overseas research office in Geneva followed in 1962.
In 1958, Jon Lovelace, Jr. introduced a new system of managing the firm’s mutual funds and accounts. Rather than assign a portfolio to a single manager, he divided each portfolio among several managers. Each manager would share ideas with peers but have total discretion over a section of the portfolio. Known today as The Capital System, it avoids the phenomenon of creating single-manager “stars,” who can impact a fund’s results should they leave. In the mid-1960s, Capital began to include research analysts in the management of the portfolios, reserving a portion of each to allow analysts to pursue their highest conviction investment ideas.
Capital Group’s long-term approach has helped it avoid some of the pitfalls that have plagued other firms. In the late 1990s, the firm was criticized for not offering then-popular tech funds. But when the tech bubble burst, Capital was praised for not jumping on the bandwagon.
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Wikipedia