Helping clients achieve tangible life goals can be a challenging task with so many complex investment options available. Capital Group has developed the USD Portfolio Series, a range of six multi-asset model portfolios for dollar-based investors outside of the US that are designed to simplify this process by delivering clear investment objectives aligned to client goals.

We sat down with the strategies’ principal investment officer, Philip Chitty, and investment director Andy Budden to get some insights into how these portfolios are constructed and how they can help advisers deliver relevant, easily-digestible investment solutions to their clients. 

 

What is the Capital Group USD Portfolio Series?

Andy Budden: The Capital Group USD Portfolio Series is a range of six multi-asset model portfolios that Capital Group has developed for dollar-based investors outside of the US. These portfolios are designed to help investors achieve their long-term life goals. Each portfolio aims to achieve a particular investment objective. Alongside our traditional offering of individual funds, these multi-asset solutions offer investors portfolios that are aligned to particular outcomes in a pre-blended, easy-to-access package.

 

Can you define what you mean by investment objective? What’s the difference between that and a life goal?

Andy Budden: Let’s start with life goals. They will be things like being able to retire at a certain age; being able to make a major purchase such as a house; being able to live comfortably in retirement; or even being able to pass on a legacy to children and grandchildren. To achieve those life goals, you then need to translate them into an investment objective: long-term growth of capital; preservation of capital; or the ability to draw a sustainable income from your assets. 

As a generalisation, we believe the financial industry has overcomplicated things. We bamboozle investors with complex terminology and jargon and then try to get them to invest in something like ‘global value equities’ or ‘asset-backed securitised debt’. How many investors really understand what that is, and how it’s going to help them achieve those goals? It’s no wonder that the industry has lost the trust of individual investors, and that they panic when markets go down. 

Rather, if we can align what people invest into their goals with a clear objective, we think that will help investors stay the course and ultimately get a better outcome.

Risk factors you should consider before investing:

• This material is not intended to provide investment advice or be considered a personal recommendation.
• 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 guide to future results.
• If the currency in which you invest strengthens against the currency in which the underlying investments of the fund are made, the value of your investment will decrease.
• Depending on the strategy, risks may be associated with investing in fixed income, derivatives, emerging markets and/or highyield securities; emerging markets are volatile and may suffer from liquidity problems.