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Multiple Portfolio Counselor System

How it works
Benefits for investors
The research portfolio
 An example: Capital International - Global Equity

The Multiple Portfolio Counselor System provides our portfolios with natural diversification and combines the best of individualism and teamwork.

How it works

The Capital organization developed the Multiple Portfolio Counselor System in 1958.
  • Assets of each portfolio are divided into smaller, more manageable portions that are independently managed, subject to overall guidelines.
  • Each manager typically invests in only 30 to 40 companies. The combination of individual managers' investment styles complement each other, leading to broad diversification.
  • A group of research analysts typically manages one portion - as much as 25% of the assets.
  • The lead manager and the investment committee for each portfolio make sure it is managed according to its goals and objectives and monitors risk for the entire portfolio.

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Benefits for investors


Diversity - Because each investment professional offers unique experience and acts on different convictions, this approach can further the benefits of diversification.

Consistency - When one manager has had a poor year, his or her results usually have been offset by the success of one or more other managers.

Continuity - When one manager retires or changes responsibilities, only a portion of the portfolio changes hands. Smooth, gradual transitions help each portfolio's investment approach remain constant.

Manageability - Portfolio managers and analysts can act independently on their best ideas, with no need for consensus. Also, managers can be added to the portfolio as assets grow.

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The research portfolio


At most investment management firms, analysis is considered a training ground for portfolio management. At the Capital organization, research is considered of equal, if not greater, importance because in-depth research and analysis are the cornerstones of our investment approach.
  • A substantial portion of many portfolios' assets is generally assigned to a research portfolio, where analysts act as one portfolio manager, diversified by industry, and, if appropriate, by geography.
  • The Research Portfolio is a powerful communication tool between analysts and portfolio managers.
  • Because our research analysts manage portfolio assets, they have an incentive to stay in the role for years, sometimes decades. That allows them to know very well the companies they follow and invest in what they know best. Analysts are also compensated similarly to portfolio managers.


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An example: Capital International — Global Equity

Capital International - Global Equity, which invests primarily in the securities of large companies on a global basis, is managed by three portfolio managers who average more than 26 years' industry experience. Each of these individuals brings his or her unique perspective to the investment process. Investment analysts also manage a portion of assets, investing within their own areas of focus.

Data as of December 31, 2009.

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