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Fund Spy

American Funds Adapts to Changing Markets

Even the strongest have to evolve.

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Morningstar recently issued a new Stewardship Grade for American Funds. The firm's overall grade--which considers corporate culture, fund board quality, fund manager incentives, fees, and regulatory history--is an A. What follows is Morningstar's analysis of the firm's corporate culture. This text, as well as analytical text on the other four Stewardship Grade criteria, is available to subscribers of Morningstar's software for advisors and institutions: Morningstar Principia®, Morningstar Advisor Workstation(SM), Morningstar Office(SM), and Morningstar Direct(SM).

American Funds' cultural strengths begin at the founding of its parent company, Capital Group, in 1931 by investor Jonathan Lovelace. Since then, investors have remained firmly at the helm of this privately held company, and longtime portfolio managers such as Tim Armour, Rob Lovelace, and Jim Rothenberg comprise the majority of the firm's management committee. That group sets the firm's overall business direction, and its guidance mirrors the patient and long-term nature that have long been the hallmarks of the firm's investment offerings.

Janet Yang, CFA does not own (actual or beneficial) shares in any of the securities mentioned above. Find out about Morningstar’s editorial policies.