Capital Group is set to launch a multi-asset income fund for investors in Asia.
The new fund – Capital Group Capital Income Builder – follows the same investment approach as the over $100 billion multi-asset income strategy in the US that was incepted since 1987.
The company's spokesperson told Citywire Asia that the new fund will be available for both high-net-worth and retail investors in Hong Kong and Singapore.
Scheduled to be launched on 21 September , the new fund will be Capital Group’s third multi-asset fund available for sale in Asia, the spokesperson said.
The other two multi-asset funds that are available for sale in the region are the Capital Group Emerging Market Total Opportunities fund and Capital Group Global Allocation fund.
James Lovelace, the company's Los Angeles-based portfolio manager and principal investment officer, will be the lead manager for the Capital Group Capital Income Builder fund.
He works with a team of 11 portfolio managers that are spread across Capital Group's offices globally.
The new Luxembourg-domiciled fund seeks to provide income that exceeds the average yield paid by US stocks in general and is managed by the same investment team of its multi-income strategy in the US.
The fund would invest at least 90% of the fund’s portfolio in income-producing securities, and at least 50% of the fund’s assets in common stocks of large, established companies with prove records of increasing dividends.
The fund may also invest in preferred stocks, convertibles, bonds and cash, as well as up to 50% of its assets outside the US.
The launch of the new multi-asset fund continues the build-out of a multi-year strategic plan to give clients based outside the US access to Capital Group’s long-standing US strategies.
In today’s low-yield environment, many investors are looking for more balanced products that can provide a reliable income stream without excessive exposure to volatility, Andy Budden, the company’s investment director said.
‘Our tried-and-tested approach, which focuses on dividend stocks for income as opposed to lower quality fixed income investments, can potentially provide a more durable return profile for investors,’ he added.
Tom Quantrille, the company’s president and head of Asia, said Capital Group is seeing growing demand in Asia for multi-asset goal-oriented solutions and therefore continues to expand its offering and capabilities in this area for investors in Asia.
Capital Group manages about $400 billion in multi-asset investments globally, and more than $1.8 trillion of assets under management.
The firm has been serving investors in the Asia-Pacific region for more than 30 years, and has offices in Beijing, Hong Kong, Mumbai, Singapore, Sydney and Tokyo.