02.01.2012
By Terry Flanagan

American Century Expands

Two new American Century products offer solutions for the alternative and fixed income investor.

American Century, the Kansas City 100 billion plus asset management firm, has announced on January 31, the launch of two new products to its multi-strategy, cross-asset class line-up: the American Century Global Allocation and American Century Global Bond.

The Global Allocation product will be added to the firm’s existing suite of asset allocation products, and will be jointly managed by Chief Investment Officer Enrique Chang, Rich Weiss, senior portfolio manager of asset allocation products, Scott Wittman, quantitative equity chief investment officer, and Scott Wilson, portfolio manager.

American Century plans on implementing a higher degree of tactical asset allocation with this new product, which offers global exposure to equities, bonds, cash and alternatives that may provide exposure to derivatives—but not hedge funds or private equity.

“Some tactical allocation strategies can include a ‘three-way’ asset allocation, global sector rotation, tactical currency overlays and tail hedging using volatility-related investments,” said Weiss. He also told Markets Media that his team will “assess the near-term attractiveness of commodities and REITs (real estate investment trusts).

As of year-end in 2011, American Century manages more than $13 billion in asset allocation strategies. The firm’s other strategic asset allocation products include: its “One Choice” portfolios and Strategic Allocation Funds.

The newly launched American Century Global Bond Global fund is designed to be a core bond portfolio, and will offer a mix of 60% foreign bonds and 40% domestic bonds across the government, corporate and mortgage sectors. The fund also has the ability to invest in high yield and emerging market debt.

“Global Bond is an intermediate-term, investment-grade global bond fund that is designed to beat benchmarks over shorter term market cycle,” said John Lovito, senior portfolio manager of the fund. “Though, its total return investment philosophy emphasizes capital appreciation and income.”

The team has a favorable outlook towards corporate bonds, both investment grade and high yield credit—areas in which “there is ample liquidity.” Though the fund’s mandate is flexible and wide-ranging, risk controls, such as staying liquid, will be paramount for Lovito, who told Markets Media that American Century is using “state of the art” investing and trading technology to keep an eye on portfolios.

Related articles

  1. Electronification of the municipal bond market also presents a large opportunity.

  2. Aberdeen AM Looks to Grow In China

    The success of Northbound trading showed electronic execution is way forward for the bond market.

  3. Margins Raised Ahead of Brexit Vote

    IRS trading volumes have fragmented without an equivalence agreement.

  4. Increased electronification has created useable and accessible real-time and historic trade data.

  5. Members are evaluating payment-versus-payment for currencies not yet eligible for CLSSettlement.