Fund Authority Scores rate mutual funds and exchange traded funds (ETFs) on the most important economic factors that influence individual investors’ net long term diversified investment fund performance. The Skilled Investor developed the Fund Authority Score system to provide individual investors with concise and objective summaries of mutual funds and ETFs for comparisons within investment asset classes.
For a directory of the Fund Authority Score reports of other mutual funds and ETFs, go here. When you go to this Fund Authority Score directory, you can easily find a list of all fund reports at the bottom of each article for that particular asset class. For more information about how a Fund Authority Score is developed for each mutual fund or ETF, go here.
The diversified investment fund strategy of the American Funds’ Capital Income Builder mutual fund
At approximately $114 billion in assets with 2.9 million shareholder accounts, the Capital Income Builder Fund is a very large actively managed mutual fund. This fund invests worldwide and focuses on the equity and debt securities of firms that generate income.
The Capital Income Builder Fund has a mandate to invest at least 50% of its assets in stocks or equities and recently had about 73% invested in equities with about 28 of these percentage points in U.S. equities and the remaining 45 of these percentage points in non-U.S. equities.
Bonds constituted about 18% of the mutual fund portfolio with all but a couple of these percentage points invested in U.S. bonds. Growth of capital is a secondary objective of this mutual fund.
The Capital Income Builder Fund has a variety of share classes which can only be purchased through an advisor or other financial intermediary – not directly.
The table below presents the Fund Authority Score and other information for the Capital Income Builder mutual fund – Class A Shares.
Using an integer scale ranging from -10 to +10, Fund Authority Scores measure five factors:
1) annualized management and investment sales expenses (40% weighting), 2) annual trading costs implied by investment fund portfolio turnover (30% weighting), 3) inferior and superior historical performance (20% weighting), 4) minimum fund maturity (5% weighting), and 5) minimum fund size for operating efficiency (5% weighting).
Fund Authority Summary for the American Funds – Capital Income Builder Fund – Class A Shares (CAIBX) Fund Authority Summary American Funds – Capital Income Builder Fund Fund Authority Score [...]