American Funds Investment Company of America Earns High Rating with Improved Process and Capable Management Team

American Funds Investment Company of America has been upgraded to a Silver Morningstar Medalist Rating due to increased confidence in its flexible approach and a capable management team. The fund seeks a mix of dividend-payers and growth names but has struggled in the past striking the right balance. The co-heads have decreased the fund's preyield target and expanded its eligibility list to increase flexibility. The fund has outperformed the S&P 500 in 2023 and 2024 and has strong picks in several sectors.

American Funds Investment Company of America (AFICA) has been upgraded to a Silver Morningstar Medalist Rating, reflecting increased confidence in its flexible investment approach and a capable management team. This upgrade, announced on July 2, 2025, comes after a series of strategic changes that have positioned the fund for better performance.

The fund, which seeks a mix of dividend-payers and growth names, has historically struggled to strike the right balance. However, recent modifications to its investment process have shown promising results. In 2020, co-heads Martin Romo and Grant Cambridge reduced the fund's preyield target and expanded its eligibility list, increasing the managers' flexibility. This change was supported by the addition of experienced managers Jessica Spaly and Aline Avzaradel, who bring diverse investment styles to the team.

The fund's performance has since improved, with notable outperformance in 2023 and 2024. During these years, the fund landed in the top quintile of its Morningstar Category, demonstrating strong sector picks such as Meta Platforms (META), Broadcom (AVGO), and GE Aerospace (GE). Additionally, the fund has shown resilience in down markets, with a 15.5% loss in 2022 being milder than the S&P 500's 18.1% loss.

While the fund has faced challenges in the past, such as underweighting high-performing stocks like Apple (AAPL) and avoiding highflyers like Tesla (TSLA) and Nvidia (NVDA), the recent changes have led to more impressive results. The fund's risk-adjusted returns have beaten the S&P 500 since its inception, and it has shown strong performance in recent years.

American Funds Investment Company of America's upgrade to a Silver Morningstar Medalist Rating is a testament to the fund's ability to adapt and improve its investment process. With a capable management team and a flexible approach, the fund is well-positioned to continue delivering strong performance for investors.

References:
[1] https://www.morningstar.com/funds/xnas/gwpax/quote
[2] https://www.morningstar.com/funds/why-we-highly-rate-american-funds-investment-company-america