American Funds Mgd Risk Ast Alloc
Objective And StrategyObjective
High total return (including income and capital gains) consistent with preservation of capital over the long term while seeking to manage volatility and provide downside protection.
The investment seeks to provide the investors with high total return (including income and capital gains) consistent with preservation of capital over the long term while seeking to manage volatility and provide downside protection. The fund pursues its investment objective by investing in shares of an underlying fund, the American Funds Insurance Series Asset Allocation Fund℠, while seeking to manage portfolio volatility and provide downside protection primarily through the use of exchange-traded futures contracts. While the fund is non-diversified, it invests in diversified underlying holdings.
* This portfolio invests its assets in underlying funds, thus the risks associated with investing in the portfolio are closely related to the risks associated with the securities and other investments held by the underlying funds. The ability of this portfolio to achieve its investment objective will depend on the ability of the underlying funds to achieve their investment objectives.
* Income provided by the fund may be reduced by changes in the dividend policies of, and the capital resources available at, the companies in which the fund invests.
* Rising interest rates will generally cause the prices of bonds and other debt securities to fall. Longer maturity debt securities may be subject to greater price fluctuations than shorter maturity debt securities. In addition, falling interest rates may cause an issuer to redeem, call or refinance a debt security before its stated maturity, which may result in the fund having to reinvest the process in lower yielding securities.
* A futures contract is considered a derivative because it derives its value from the price of the underlying security or financial index. The prices of futures contracts can be volatile, and futures contracts may be illiquid. In addition, there may be imperfect or even negative correlation between the price of a futures contract and the price of the underlying securities.
- Fund Prospectus and Other Forms