Founded in 1931, Capital Group offers a wide range of financial services all over the world through its offices in different regions including North America and Europe, and 7,000 associates. With average of 27 years of investment experience, American Funds, a segment of Capital Group, offers a wide range of mutual funds with an objective of providing long-term returns.
American Funds currently manages nearly $1 trillion, allocated to a large number of mutual funds including equity as well as fixed-income funds. Moreover, one of the biggest investment management organizations in the world, Capital Group, has around $1.4 trillion assets under management.
Below we share with you three top-ranked mutual funds from American Funds. Each has earned a Zacks Mutual Fund Rank #1 (Strong Buy) and is expected to outperform its peers in the future.
Mutual Funds to Buy From the American Funds Portfolio: American High-Income Municipal Bond Fund (AMHIX)
American High-Income Municipal Bond Fund (MUTF:AMHIX) invests a major portion of its assets that provide federal income tax free returns or that have returns subject to minimum alternative federal tax.
AMHIX invests a minimum of half of its assets in debt instruments that are rated Baa1 or BBB+ or lower. American High-Income Municipal Bond A has three-year annualized returns of 4.2%.
AMHIX has an expense ratio of 0.67% compared with the category average of 0.95%.
Mutual Funds to Buy From the American Funds Portfolio: The Growth Fund of America (RGAGX)
American Funds The Growth Fund of America (MUTF:RGAGX) invests a bulk of its assets in common stocks of companies that generally offer capital appreciation. RGAGX may also invest around one-fourth of its assets in securities of foreign companies.
The fund attains its investment objective by using the multiple portfolio manager system. American Funds The Growth Fund of America Class R-6 has three-year annualized returns of 15.8%.
Michael Kerr has been one of the fund managers of RGAGX since 1998.
Mutual Funds to Buy From the American Funds Portfolio: American Funds Tax-Advantaged Growth and Income Portfolio (TAIAX)
American Funds Tax-Advantaged Growth and Income Portfolio (MUTF:TAIAX) invests in underlying American Funds, whose returns may be exempted from regular federal income tax. These funds include both equity and fixed income funds.
TAIAX is expected to have significant exposure to dividend stocks by investing in these underlying funds. It may also invest in funds that allocate a sizable portion of their assets in foreign securities, which also include those issued in emerging markets. American Funds Tax-Advantaged Income A has three-year annualized returns of 7.3%.
As of September 2017, TAIAX held 5 issues with 25% of its assets invested in the shares of American Funds Tax Exempt Bond R-6.
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