American Century has launched a new Multi-Asset Income Fund (AMJVX-Investor Class).
Managed by the same team responsible for American Century Investments' popular target date, target risk and strategic allocation portfolios, the fund is designed for investors seeking sustainable monthly income from a diversified portfolio consisting of a mix of domestic and foreign fixed income and equity investments.
While the fund is not required to allocate its assets in any fixed proportion, over the long term, its equity allocations are expected to range from approximately 20-to-60 per cent of the fund's assets, with the fixed income portion ranging from approximately 40-to-80 per cent.
"Multi-Asset Income combines the top-down asset allocation expertise on my team with the bottom-up security selection skills from across American Century's various disciplines in pursuit of the best income-generation opportunities," says Scott Wittman, chief investment officer for asset allocation and disciplined equity. "While typical sources of yield such as US high yield bonds and dividend-paying stocks of domestic companies are expected components of the fund, we are casting a much wider net in our quest to generate sustainable monthly income for investors."
According to Wittman, Multi-Asset Income will dynamically allocate across multiple income-producing asset classes. Within equities, the team has the latitude to invest in global dividend-paying stocks, utilities, convertible securities, preferred stock, global REITs and master limited partnerships. The fixed income component spans the US and non-US bond market, with specific emphasis on income-oriented sectors, including high yield, developed and emerging market debt, currencies and mortgage-backed securities.
While the Multi-Asset Income portfolio seeks income as its primary objective, long-term capital appreciation is a secondary objective. The portfolio management team factors in total return and risk in an attempt to enhance the potential for sustainable income. Consideration of total return is important in order to maintain the growth of capital above inflation, according to Wittman. The team strives to manage the dominant risks inherent in multi-asset income-focused portfolios, including equity risk, interest rate risk and credit risk.