Importance of diversity

STAR MANAGERS SPECIAL

Capital Group

Capital Group New Perspective Fund

Matt Reynolds (investment director)

According to Matt Reynolds, investment director at Capital Group, who through his fund Capital Group New Perspective (NFP) has been recognised as one of the Financial Newswire’s Star Manager, the importance of diversity cannot be overstated.

The fund’s portfolio is managed according to ‘The Capital System’, a multi-manager structure that combines independent high-conviction decision-making with the diversity that comes from multiple perspectives.

NPF invests across a spectrum of multinational companies, from early-stage multinationals with potential to become future global champions, to established global champions of today. These multinational companies are resilient, adaptable to change and are driving, shaping and benefiting from transformational changes.

“Under this system, the portfolio is divided into segments, each run by an individual manager. The managers represent a diverse set of backgrounds, styles and approaches and typically, each is personally invested in the portfolios they manage.

“While managers collaborate and share insights, each invests independently according to their strongest convictions. The resulting portfolios are a diverse collection of investment ideas, not just one manager’s perspective. This approach aims to reduce volatility and create the potential for portfolios to fare well in a variety of market conditions,” he explained.

Reynolds also stressed that NPF took a diversified and flexible approach by identifying companies on a bottom-up basis that are driving and benefiting from transformational changes in the global economy, with a focus on changing patterns of global trade, economic and political relationships, as well as multi-generational shifts in the global economy.

When asked what was the most important lesson he had learnt over the course of his career, he said: “When it comes to taking a long term approach to investing on behalf of clients, the lessons of experience and the importance of diversity cannot be overstated and they are fundamental tenets to Capital Group for over 90 years and sit at the heart of NPF’s long term investment focus.”

Reynolds also said that the most important piece of advice he would offer to someone considering such a career, would be: “research, research, research.”

He said that deep and fundamental research capabilities were always the backbone of his company and were essential to the results he delivered to his investors.

“The same applies to anyone considering a career in the investment management industry; research is paramount.”