M&G American Fund awarded ‘AA’ S&P rating

The M&G American Fund, managed by Aled Smith, has been awarded a prestigious Standard & Poor’s (S&P) ‘AA’ rating.

The £453 million fund, is ranked top out of 70 funds in the sector over three years. Since Aled Smith took over as fund manager on 31 December 2004 it has returned 34.7%, compared with the IMA North America sector average of 16.3%.

Jonathan Willcocks, Managing Director UK Sales at M&G, comments: “I am delighted that S&P has awarded the M&G American Fund an ‘AA’ rating and this is testament to the excellent performance among our home-grown talent. Since Aled Smith took over the M&G American Fund in December 2004, the fund has shown consistent outperformance.

“At a time when many investors have struggled to find more than a handful of US funds that perform consistently across market cycles, the M&G American Fund is a pragmatic, flexible fund, offering investors a core proposition for their US exposure, as shown by its outstanding performance under Aled Smith's management.”

Aled Smith, manager of the M&G American Fund, comments: “I am proud of the fund’s performance - it’s down to the investment process which looks for companies that are changing in order to improve their returns over the long term, regardless of the direction of the market. I use a variety of screening methods to highlight companies that are improving their returns, usually as a result of internal, external and/or R& D-led change.

“Whatever the nature of the change, return on capital is key. For a company to be included in the fund, it must be generating improving returns from its asset base.

“We look to buy in to a company once returns have started to improve, but before the wider market appreciates the change that caused the improvement. In this way, we can exploit the lag time between change taking place and the market catching up.

“I am confident that this investment process is consistently repeatable and will continue to deliver strong performance for the M&G American Fund, regardless of the direction of the market.”

The M&G American Fund is top decile in the IMA North America sector over one and three years and has returned 11.25 per cent over the past year compared with the sector average of 1.28 per cent.