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.
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The diversified investment fund strategy of The Investment Company of America mutual fund (AIVSX)
According to American Funds mutual fund Prospectus for The Investment Company of America, “the fund seeks to make your investment grow and provide you with income over time by investing primarily in common stocks that offer growth and dividend potential.”
At approximately $95 billion in assets with 3.1 million shareholder accounts, The Investment Company of America is a very large actively managed mutual fund. This fund may invest worldwide, however it focuses largely on U.S. equity and debt securities.
According to the statement of its investment limitations and guidelines in its recent 497 filing on the U.S. Securities and Exchange Commission’s EDGAR system, The Investment Company of America “may invest up to 15% of its assets in issuers domiciled outside the United States and not included in the Standard & Poor’s 500 Composite Index.” Given this relatively low non-U.S. stocks limitation, we have classified this mutual fund as a U.S. large capitalization mutual fund rather than as a worldwide stock mutual fund. Recently, 11% of this mutual fund’s portfolio assets were invested in non-U.S. equities.
Recently, bonds constituted 0% of this mutual fund’s portfolio, while cash and cash equivalents accounted for 13% of the portfolio. According to its 497 filing, when American Funds’ The Investment Company of America does invest “in straight debt securities (i.e., not convertible into equity) (they) will generally consist of investment grade securities. The fund may, however, invest up to 5% of its assets in straight debt securities rated Ba or below by Moody’s Investors Service and BB or below by Standard & Poor’s Corporation or unrated but [...]