Strategy Inception
2016
Strategy AUM (USD)
$6.13 B
As of 10/31/2024
A combination of quantitative and fundamental research allows for comprehensive understanding of ESG and financial factors.
3-Step Investment Process
Our fundamentally driven, risk-aware investment process screens a universe of approximately 1,500 stocks down to the most compelling 80 - 100 companies.
Steps:
Idea Generation
Financial improvement
ESG Criteria
Fundamental Evaluation
Validation of model outputs
ESG materiality analysis
Portfolio Construction
Seeks to maximize stock specific risk and ESG attributes
Minimize common factor and industry risk
Results
80 - 100 holdings
Portfolio Construction Process
Focused on maximizing stock specific risk and ESG attributes and minimizing common factor and industry risk. We value improving business fundamental and attractive ESG characteristics. Detailed below is our Buy/Sell decision framework.
Buy/Pass Decision based on:
• Conviction in the sustainability of business improvement
• Strong performance on ESG factors
• Portfolio construction and risk management needs
Sell Decision based on:
• Deterioration in financial metrics
• Weak/worsening performance on ESG factors
• Reduced appreciation potential
• Better alternatives
Experienced team working in a collaborative environment
Portfolio Managers
Firm Start
2000
Industry Start
1993
Firm Start
2000
Industry Start
1995
Firm Start
2005
Industry Start
1995
| Assets Under Management | $6.13 B USD As of 10/31/2024 |
| Location | Kansas City, MO |
Cross-Discipline Support
Client Portfolio Managers
Investment Analysts
Global Equity Trading
Sustainable Research Team
Global Analytics
Takeaways
Companies with both improving business fundamentals and risk management of material ESG issues will outperform over time.
ESG analysis complements traditional financial analysis resulting in a more comprehensive understanding of risk.
ESG integration rather than exclusionary screening leads to better diversification and a more robust opportunity set.
Risk management does not imply low risk.
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Many of American Century's investment strategies incorporate the consideration of environmental, social, and/or governance (ESG) factors into their investment processes in addition to traditional financial analysis. However, when doing so, the portfolio managers may not consider ESG factors with respect to every investment decision and, even when such factors are considered, they may conclude that other attributes of an investment outweigh ESG considerations when making decisions for the portfolio. The consideration of ESG factors may limit the investment opportunities available to a portfolio, and the portfolio may perform differently than those that do not incorporate ESG considerations. ESG data used by the portfolio managers often lacks standardization, consistency, and transparency, and for certain companies such data may not be available, complete, or accurate.
ESG Definitions:
ESG Integrated: An investment strategy that integrates ESG factors aims to make investment decisions through the analysis of ESG factors alongside other financial variables in an effort to deliver superior, long-term, risk-adjusted returns. Therefore, ESG factors may limit the investment opportunities available, and the portfolio may perform differently than those that do not incorporate ESG factors. Portfolio managers have ultimate discretion in how ESG issues may impact a portfolio's holdings, and depending on their analysis, investment decisions may not be affected by ESG factors.
ESG Focused: An investment strategy that focuses on ESG factors seeks to invest, under normal market conditions, in securities that meet certain ESG criteria or standards in an effort to promote sustainable characteristics, in addition to seeking superior, long-term, risk-adjusted returns. This investment focus may limit the investment opportunities available to a portfolio. Therefore, the portfolio may underperform or perform differently than other portfolios that do not have an ESG investment focus. ESG-focused investment strategies include but are not limited to impact, best-in-class, positive screening, exclusionary, and thematic approaches.
This is marketing material. This information is intended to be general in nature and is not personal financial product advice. Any advice contained here is general advice only and has been prepared without considering the investment objectives, financial situation or particular needs of any particular person. Before acting on any information, you should consider the appropriateness of the information provided and the nature of the relevant financial product having regard to your investment objectives, financial situation and needs. It is not intended to take the place of professional advice and you should not take action on specific issues in reliance on this information. American Century nor any of their related parties, their employees or directors, provide any warranty of accuracy or reliability in relation to such information or accept any liability to any person who relies on it.