American Century Investments: A Guide to Purposeful Investing
American Century Investments: A Legacy of Purpose-Driven Investing and Client Success
In the sprawling landscape of investment management, where firms often blend into a sea of similar offerings, American Century Investments stands as a testament to a unique and enduring vision. For over six decades, this Kansas City-based powerhouse has not only guided investors toward their financial aspirations but has done so with a profound sense of purpose that extends far beyond the traditional metrics of Wall Street. This is a story of innovative investment strategies, a steadfast commitment to client education, and a groundbreaking ownership structure that has funneled billions into life-saving medical research. This in-depth exploration will delve into the multifaceted world of American Century Investments, examining its rich history, comprehensive services, and unwavering dedication to making a meaningful impact on both portfolios and the well-being of humanity.
A Foundation Built on a Vision: The Inspiring History of American Century Investments
The genesis of American Century Investments is a story of entrepreneurial spirit and a desire to make investing accessible to all. In 1958, with a modest $100,000 in assets from just 24 investors, James E. Stowers Jr. laid the groundwork for what would become a global asset management firm. His initial venture, known then as Twentieth Century Mutual Funds, was founded on the principle of offering no-load funds, a revolutionary concept at a time when high commissions were the norm. This client-centric approach, prioritizing the investor’s return over sales charges, became a cornerstone of the firm’s identity.
The company’s trajectory was marked by steady growth and a burgeoning reputation for its disciplined investment approach. A pivotal moment in its history, however, came not from a financial maneuver, but from a deeply personal experience. After both he and his wife, Virginia, survived cancer, James E. Stowers Jr. was inspired to create a lasting legacy dedicated to advancing medical research. This led to the establishment of the Stowers Institute for Medical Research, a world-class biomedical research facility in Kansas City.
In a move that would forever define the character of American Century Investments, the Stowers family endowed the institute with a significant portion of their ownership in the investment firm. Today, a controlling interest in American Century is held by a supporting organization of the Stowers Institute. This unique ownership structure means that a substantial portion of the firm’s profits, paid as dividends, directly funds the institute’s critical research into genetically based diseases like cancer. Since 2000, this has resulted in over $2 billion being channeled into the quest for cures, a powerful embodiment of the firm’s mantra: “Prosper with Purpose.”
A Comprehensive Suite of Services for Every Investor Journey
American Century Investments has cultivated a diverse and robust array of services designed to meet the needs of a wide spectrum of investors, from individuals just starting their financial journey to sophisticated institutional clients. Their offerings are thoughtfully categorized to provide clear pathways to achieving specific financial objectives.
For individual investors, the firm provides a holistic ecosystem of support. This includes a broad range of investment accounts, such as general investing accounts, Individual Retirement Accounts (IRAs) in both Traditional and Roth varieties, and educational savings accounts like the 529 plan and Coverdell Education Savings Accounts (ESAs). Recognizing that every investor’s path is unique, American Century offers tailored guidance and resources for various life stages, from accumulating wealth to planning for a secure retirement and creating a lasting legacy.
Financial advisors are also a key focus for American Century, with a dedicated suite of tools and resources to support their practices. This includes access to in-depth market insights, practice management resources to enhance client relationships, and detailed information on the firm’s investment products. By empowering advisors, American Century extends its reach and expertise to a broader audience of investors.
Charting a Course to Your Financial Future: A Focus on Investing Goals
At the heart of American Century’s philosophy is a deep understanding that successful investing begins with clearly defined goals. The firm’s resources and advisory services are structured to help clients articulate and prioritize their financial aspirations, whether it’s building a nest egg for retirement, funding a child’s education, or growing wealth for future generations.
Their approach to retirement planning is particularly comprehensive, with resources segmented for individuals at every stage of their journey. For those “Saving for Retirement,” the firm provides educational materials and tools to help them get started and stay on track. For those “Nearing Retirement,” the focus shifts to income planning and navigating the transition from accumulation to distribution. And for those “In Retirement,” American Century offers guidance on making savings last and managing income streams effectively.
College savings are another key area of focus, with the firm managing the Learning Quest® 529 Education Savings Program for the state of Kansas. They provide a wealth of information on the benefits of 529 plans, including their tax advantages and flexibility, as well as calculators and tools to help families estimate college costs and create a savings plan.
Navigating the Complexities of a Tax-Efficient Investment Strategy
American Century Investments recognizes the significant impact that taxes can have on investment returns. To help clients navigate this complex landscape, the firm provides a dedicated Tax Center on its website. This valuable resource offers a wealth of information and tools to promote tax-aware investing.
The Tax Center includes access to important tax documents, such as 1099 forms, as well as resources to help investors understand concepts like cost basis, capital gains distributions, and the tax implications of various investment decisions. While American Century does not provide tax advice, they empower investors and their tax professionals with the information needed to make informed decisions and potentially minimize their tax burden. This commitment to transparency and education is a key component of their client-centric approach.
Empowering Investors Through Comprehensive Financial Education
A cornerstone of American Century’s mission is the empowerment of investors through education. The firm offers a rich and accessible library of financial education resources designed to demystify the world of investing and build confidence at all levels of experience. Their online “Insights” section features a steady stream of articles, guides, and market commentary on a wide range of topics.
For those new to investing, the “Investment Basics” section provides a clear and concise introduction to fundamental concepts such as stocks, bonds, and mutual funds. The firm also offers practical guidance on topics like “How to Build Your Own Investment Portfolio,” walking investors through a four-step framework for defining goals, assessing risk tolerance, and constructing a diversified portfolio.
Beyond the basics, American Century delves into more advanced topics, offering insights on market trends, economic outlooks, and various investment strategies. They provide a variety of calculators and interactive tools to help investors with retirement planning, college savings projections, and understanding the potential impact of different investment decisions. This commitment to financial literacy underscores their belief that an informed investor is a more successful investor.
A Disciplined and Research-Driven Investing Approach
American Century’s investment philosophy is rooted in a disciplined, research-driven approach that has been honed over decades. The firm’s investment teams operate with a high degree of autonomy, each with its own distinct and repeatable investment process. This allows for a diversity of thought and strategy across a wide range of asset classes and investment styles.
A key tenet of their approach is a focus on fundamental research. Their teams of experienced analysts conduct in-depth due diligence on individual securities, seeking to identify companies with strong fundamentals, sustainable competitive advantages, and attractive long-term growth prospects. This bottom-up approach to security selection is a hallmark of their active management strategies.
In recent years, American Century has also embraced a “Systematic Active” approach, most notably through their Avantis Investors® brand. This strategy combines the principles of financial science with the benefits of a systematic and repeatable process. The goal is to build broadly diversified, tax-efficient, and low-cost portfolios that aim to outperform their benchmarks over the long term. This innovative approach reflects the firm’s commitment to evolving with the market and providing clients with cutting-edge investment solutions.
Furthermore, their multi-asset strategies are built on a foundation of risk management. These portfolios are designed to navigate various market environments by strategically allocating assets across different classes and employing dynamic risk management techniques to mitigate volatility and preserve capital.
A Diverse Array of Investment Products to Meet Every Need
American Century Investments offers a comprehensive lineup of investment products designed to cater to a wide range of investor preferences, risk tolerances, and financial goals. Their product suite includes a variety of mutual funds, exchange-traded funds (ETFs), and separately managed accounts.
Their family of mutual funds is extensive, covering a broad spectrum of asset classes, including domestic and international equities, fixed income, and multi-asset allocation funds. These funds are managed by their various investment teams, each with its own distinct investment philosophy and process, providing investors with a diverse range of strategies to choose from. Many of their mutual funds are no-load, aligning with their founding principle of putting clients first.
The firm has also made a significant push into the ETF market with its Avantis Investors® and American Century Investments branded ETFs. These offerings provide investors with access to a range of actively managed and systematic strategies in a tax-efficient and lower-cost vehicle. Their ETF lineup includes a variety of equity, fixed income, and alternative strategies, further expanding the choices available to investors.
For higher-net-worth individuals and institutional clients, American Century offers separately managed accounts (SMAs). These portfolios provide a more customized investment solution, allowing for greater control over individual security selection and the potential for more tailored tax management.
A Closer Look at American Century's Fund Offerings
Within their broad product lineup, American Century offers a number of well-regarded funds that have garnered attention for their performance and consistent management. Their “One Choice®” series of target-date funds provides a simplified solution for retirement investors, automatically adjusting their asset allocation to become more conservative as the target retirement date approaches.
Their equity funds span the style and capitalization spectrum, with offerings focused on growth, value, and core strategies across large-cap, mid-cap, and small-cap companies, both in the U.S. and internationally. Similarly, their fixed-income funds offer a range of options, from core bond funds to more specialized strategies focused on high-yield, municipal, and international bonds.
The Avantis Investors® ETFs have quickly gained traction in the market, offering a systematic approach to capturing the long-term drivers of expected returns. These funds are built on academic research and are designed to provide broadly diversified exposure to various market segments with a focus on value and profitability factors.
A Global Force: Assets Under Management and a Worldwide Reach
As of their 2023 Corporate Sustainability Report, American Century Investments managed over $229 billion in assets. This substantial figure reflects the trust that millions of investors have placed in the firm’s ability to navigate the complexities of the global financial markets and deliver long-term results. Their client base is diverse, encompassing individual investors, financial advisors, and institutional clients around the world.
A Strategic Partnership for Global Growth
In a strategic move to expand its global reach and enhance its distribution capabilities, American Century Investments entered into a significant partnership with Nomura Holdings, Inc. in 2016. Nomura, a leading global financial services group based in Japan, acquired a non-controlling 41% economic interest in American Century.
This partnership is mutually beneficial, providing American Century with greater access to the Asian market, where Nomura has a strong presence. In turn, Nomura’s clients gain access to American Century’s deep expertise in active and systematic investment management. The two firms have minimal overlap in their investment strategies and geographical footprint, creating a synergistic relationship that is poised for long-term growth and collaboration.
A Legacy of Excellence: Awards and Recognition
American Century Investments has consistently been recognized by the investment community for its strong performance, commitment to clients, and innovative approach. While a comprehensive list of all accolades is extensive, some recent highlights underscore the firm’s continued excellence.
In 2024, American Century was a winner in the Wealth & Finance International Fund Awards, being named the “Most Client-Centric Impact Investment Manager 2024 – USA.” Their BCHYX fund also received recognition as the “Best Actively Managed Mutual Fund 2024 (Since Inception).”
The firm has also been a consistent recipient of Lipper Fund Awards, which recognize funds that have delivered consistently strong risk-adjusted performance relative to their peers. In 2023, their One Choice In Retirement strategy was recognized for its impressive 10-year performance.
Furthermore, American Century Investments was ranked 40th in the prestigious Barron’s Best Fund Families of 2024, a testament to the overall strength and performance of their fund lineup. These awards and rankings are a reflection of the firm’s unwavering commitment to delivering value to their clients.
American Century Investments is far more than just a money manager. It is a firm with a rich history, a unique purpose, and an unwavering commitment to its clients. From its revolutionary beginnings as a no-load fund provider to its groundbreaking ownership structure that fuels life-saving medical research, American Century has consistently demonstrated a dedication to doing well by doing good. With a comprehensive suite of services, a disciplined investment approach, and a deep commitment to financial education, the firm is well-positioned to continue its legacy of helping investors prosper with purpose for many years to come.
American Century Investments Leadership & Teams
Jonathan Thomas – Chairman, Chief Executive Officer
Cleo Chang – Senior Vice President, Chief Investment Solutions Officer
John Pak – Senior Vice President, General Counsel
Joe Schultz – Senior Vice President, Chief Client Officer
Victor Zhang – Senior Vice President, Chief Investment Officer
Jamie Patel – Chief Technology Officer
Brett Conlon – Chief Information Security Officer
Greg Barner – Vice President and Chief Privacy Officer
Richard Smith – Chief Operating Officer Global Distribution
Erik Schneberger – Chief Marketing Officer
Sarah Cossa – Senior Vice President, Chief People Officer
Tarun Sood – Chief Data Officer
Juliet Bartlett – Vice President Marketing
Jeff John – Vice President, Senior Portfolio Manager
Headquarters: 4500 Main Street Kansas City, MO 64111‑1816 USA
Phone: 816-531‑5575
Number of employees: 1,400
Website: www.americancentury.com