Morningstar - Q3 2020 - 53

Staying Power
American Funds AMCAP has been a standout through
varied cycles.
BEST IDEAS: MANAGER

Alec Lucas

American Funds AMCAP AMCPX

This article is adapted from the fund's Morningstar Global Fund Report dated
June 24, 2020.

Stats 06/30/2020

American Funds AMCAP AMCPX has a moderate growth profile that
hasn't been an advantage in recent years, but its ability to stand out through
varied market cycles remains intact. Its cheapest share classes earn
a Morningstar Analyst Rating of Gold, while its pricier shares get Silver.

Morningstar Analyst Rating
Œ

Morningstar Category
Large Growth

Expense Ratio
0.69%

Fee Level
Low

10-Yr Annlzd Return
13.99%

10-Yr % Rank in Cat
69

Morningstar Pillars 06/30/2020
Process
Above Avg

This multicap fund's 1967 origins predate the slicing and dicing of the market
into narrowly prescribed segments. Even today, its managers look for
broader capital appreciation opportunities than most of their large-growth
Morningstar Category counterparts and aren't afraid to hold cash when
they don't find any.

People
High

Growth of 10K 06/30/2020

American's multimanager system gives the fund a good shot at continued
success. It divides the overall portfolio into separately run sleeves and
lets each of the fund's eight managers stick with their highest-conviction picks,
while the combination of sleeves mutes volatility. It also helps the fund
navigate succession, such as the May naming of firm veteran Gregory Wendt in
anticipation of longtime manager Claudia Huntington's October retirement.
The fund remains a stellar long-term option. K
Alec Lucas is a manager research strategist with Morningstar.

14.13 14

10

American Funds AMCAP

6
07/2017

07/2018

07/2019

Style Map 03/31/2020

Morningstar Ratings 06/30/2020

Fund Centroid
weighted avg. of Period
equity holdings
3-Yr
Zone
5-Yr
75% of fund
equity holdings 10-Yr

Micro Small Mid Large Giant

The fund's core leanings have largely been a headwind over the past decade.
The A shares' 13% annualized 10-year gain placed in the category's bottom
third. But outperformance in 2016 and in the early 2000s provides a reminder
that this fund can still deliver when growthier peers stumble.

$18K
17.48

Morningstar US Large Growth

Granted, poorly timed cash allocations have been a problem. The fund's 15%
average cash stake hurt in 2017's rally, for example. Cash then fell to
a nearly 10-year low of 7.3% in early 2020, before the sharp sell-off; it then
rose to 9.3% by May as the market rebounded.
The managers' stock-picking prowess has offset such cash missteps over
extended periods. Through May, the A shares' top-quartile, 20-year
7.4% annualized gain beat the Russell 3000 Growth Index and the Russell 3000
Index, with which the fund is more closely correlated, by 1.7 and 1.2
percentage points, respectively.

Parent
High

Deep Core Core Core High
Value Value
Grwth Grwth

Mstar
Return

Mstar
Risk

Mstar
Rating

Below Avg Below Avg QQ
Below Avg Below Avg QQ
QQQ

Below Avg Low

QQQ

Overall Rating

Top 5 Sectors 03/31/2020

Sector

■ Fund % 

❙ Category Average %

d Healthcare

19.4

a Technology

3-Yr Avg
23.0

25.4

16.4

29.7

13.2 16.6

i Communication Serivces

3.1

6.7 9.9

p Industrials
t Consumer Cyclical

12.4

9.1

0%

24.5

15.5

14.3
10

20

morningstar.com/lp/magazine

30
53
http://www.morningstar.com/lp/magazine
Morningstar - Q3 2020

Table of Contents for the Digital Edition of Morningstar - Q3 2020
