Capital Group is introducing a multi-asset approach in Europe.
The Capital Group, a renowned investment management company, has made its American Balanced Strategy available to European investors through the Capital Group American Balanced Fund (LUX). This fund, with the ISIN LU2359297087, follows the same investment approach as its successful US counterpart.
The Capital Group American Balanced Strategy invests in a mix of major equity and bond markets, with a focus on the US. It aims for a balanced mix of capital preservation, income generation, and long-term capital and income growth. The strategy seeks equity-like returns with significantly lower volatility, making it an attractive option for investors seeking a moderate risk profile.
The Capital Group American Balanced Fund (LUX) is managed by a team of ten portfolio managers, ensuring a diverse and experienced approach. The fund's assets under management stand at approximately $210 billion, reflecting its wide appeal.
While the American Balanced Strategy has a long history through its original US mutual fund version, its performance has been mixed relative to benchmarks over recent years. The US fund, with the Class A ticker ABALX, has shown annualized returns of about 8.78% over 5 years and 8.30% over 10 years, underperforming the S&P 500 but outperforming its category average for the 10-year period as of mid-2025. However, it has underperformed its benchmark in some recent periods, such as 2023 and 2024, suggesting challenges in generating alpha in current market environments.
The European-domiciled version of the fund, launched only in 2021, has limited performance data but showed some underperformance compared to its benchmark in 2023-2024, similar to the US fund trends.
Separately, Capital Group launched a Core Balanced ETF (CGBL) in September 2023, which has performed strongly with an annualized gain of about 20.5% through mid-2025. This ETF holds a diversified portfolio with significant tech and healthcare sector exposure, backed by a strong management team and a low-cost structure, earning a Morningstar Gold rating.
In conclusion, while the American Balanced Strategy has a solid long-term pedigree and moderate returns typical of balanced funds, recent periods show some relative underperformance in both US and European-domiciled versions. The new Core Balanced ETF shows strong early performance, though it is too new for long-term conclusions. European investors accessing the strategy via the LUX fund should note the limited historical data but can look to the US fund for longer-term context.
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[1] Capital Group. (2025). Capital Group American Balanced Fund (LUX) Fact Sheet. [Online]. Available: https://www.capitalgroup.com/ux/products/funds/luxembourg/lux2359297087
[2] Morningstar. (2025). Capital Group American Funds Balanced Portfolio. [Online]. Available: https://www.morningstar.co.uk/uk/funds/snapshot/snapshot.aspx?Ticker=ABALX
[3] Morningstar. (2025). Capital Group Core Balanced ETF. [Online]. Available: https://www.morningstar.co.uk/uk/funds/snapshot/snapshot.aspx?Ticker=CGBL
[4] Financial Times. (2025). Capital Group Launches Core Balanced ETF. [Online]. Available: https://www.ft.com/content/9310a960-e8a8-4d40-8321-b12840d5d132
Other investors may find the diversified portfolio and moderate risk profile of the Capital Group American Balanced Fund (LUX) attractive, as it seeks equity-like returns with significantly lower volatility. The fund's unique business model, which combines active investing in a mix of major equity and bond markets with a focus on the US, aims for a balanced mix of capital preservation, income generation, and long-term capital and income growth.
