Critical Client Conversations

Pursuing Growth During Inflation

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To support clients focused on investment growth, explore these tips based on biases they often have, insights and education, and ideas on actions to help.

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Behavioral Biases in Investing

Economic shifts, such as high inflation, often bring out biases and perceptions that lurk under clients' awareness.

Knowing which ones your clients have can make it easier for you to get the conversation started.

Learn more from experts in behavioral science including author and Harvard professor Cass Sunstein. View full bio

Cass Sunstein.

Behavioral Spotlight: Overconfidence + Action Bias

“People who are focused on growth sometimes aren’t thinking enough about the long term.”

Cass Sunstein, Professor, Harvard University

Behavior-Based Tips for Better Conversations

Professor Sunstein suggests this action to uncover how growth-oriented your client really is:

  • Ask your client, “How do you feel if it turns out that you have a really good 18 months, but in that three-month period, things don't go so well?”

    Many people find out they’re not as growth-minded as they believed themselves to be when faced with market losses or high inflation.

Behavioral content Cass Sunstein ©2022 All Rights Reserved

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Share These Education Resources With Clients

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The Surprising Truth about Diversification

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Building a Growth Engine

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Consider Investments Focused on Accelerated Earnings

The faster a company’s earnings accelerate, the more likely its stock will outperform the relevant benchmark over a one- to three-year horizon, American Century Investments research has found.

See It in Action

The sample allocation illustrated in the graphic shows that, over a 10-year period, an 80/20 mix of a global equity blended portfolio and a fund focused on accelerated earnings growth, such as American Century Ultra{sup}®{/sup} Fund:

• Increased return by over 10% with a modest rise in risk.
• Delivered more than 99% outperformance against inflation (measured by Consumer Price Index (CPI)).

Sample Allocation.

Sample allocation.

Supporting Data.

Performance and statistics are as of 6/30/2022.
Data reflects past performance, assumes reinvestment of dividends and capital gains and is no guarantee of future results. Current performance may be higher or lower than data shown. Investment return and principal value fluctuate. Redemption value may be more or less than original cost. Obtain performance data current to the most recent quarter-end.

I Class funds are available through many platforms. Please contact your investment company or advisor to see if this share class is offered. (I Class minimum investment per fund is $5 million for individuals and $3 million for endowments and foundations.

*Returns are based on 10-year annualized returns and risk (measured by standard deviation).

For additional information, consult the prospectus.

Glossary: Russell 1000 Growth Index, Standard Deviation

**Global Equity Blended Portfolio is comprised of 90% MSCI World Index, 10% Bloomberg US Aggregate Bond Index

Source: MSCI. Morgan Stanley Capital International (MSCI) makes no express or implied warranties or representations and shall have no liability whatsoever with respect to any MSCI data contained herein. The MSCI data may not be further redistributed or used to create indices or financial products. This report is not approved or produced by MSCI. Source: Bloomberg Index Services Ltd

Four Star Morningstar Overall Rating.

American Century Ultra® Fund | I Class

Seeks high growth by investing in large, industry-leading companies with both sustainable accelerating earnings growth and positive price momentum.

Benefits
  • Diversifies U.S. investors’ home-bias risk

  • Looks to deliver benchmark-beating performance by investing in companies with accelerated, sustainable growth

  • Focuses on company fundamentals first and then a country’s macroeconomic environment

As of 6/30/2022. Category: Large Growth. For each fund with at least a three-year history, Morningstar calculates a Morningstar Rating™ based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a fund's monthly performance, placing more emphasis on downward variations and rewarding consistent performance.


The Morningstar Rating™ for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The Morningstar Rating does not include any adjustment for sales loads. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10- year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.

Additional Solutions for Your Consideration

Five Star Overall Morningstar Rating.

American Century Mid Cap Value Fund | I Class

Seeks to deliver higher returns with lower volatility over time through investments in high-quality, mid-sized companies.

Benefits
  • Focuses on identifying companies with sound business characteristics currently selling at a discount.

  • Balances risk and return with a goal to deliver competitive returns with lower-than-average volatility than peers.

  • Enhances portfolio diversity, especially for those investors overweight in more aggressive growth holdings.

As of 6/30/2022. Morningstar Category: Mid-Cap Value. The Morningstar Rating™ for funds, or star rating, is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history.


The Morningstar Rating™ for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The Morningstar Rating does not include any adjustment for sales loads. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10- year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.

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What’s Next?

We’re here to help you support your clients in these uncertain times.

The value and/or returns of a portfolio will fluctuate with market and economic conditions.

Investments in fixed income securities are subject to the risks associated with debt securities including credit, price and interest rate risk.

Generally, as interest rates rise, the value of the securities held in the fund will decline. The opposite is true when interest rates decline.

In addition, the lower-rated debt securities in which the fund invests are subject to greater credit risk and liquidity risk. Credit risk is the risk that an obligation won’t be paid and a loss will result. Liquidity risk is the risk that the fund will have difficulty selling its debt securities. There is no guarantee that the investment objectives will be met. Dividends and yields represent past performance and there is no guarantee that they will continue to be paid.

The information is not intended as a personalized recommendation or fiduciary advice and should not be relied upon for, investment, accounting, legal or tax advice.

General Disclosures

There is no guarantee that the investment objectives will be met.

Diversification does not assure a profit nor does it protect against loss of principal.

The information is not intended as a personalized recommendation or fiduciary advice and should not be relied upon for, investment, accounting, legal or tax advice.

Ultra Fund

The fund is subject to potentially greater short-term price volatility than that associated with an average stock fund.

Ultra{sup}®{/sup} Fund
Morningstar Rating - I Class

Morningstar Category - Large Growth

Overall

3 Year

5 Year

10 Year

Ratings

Five stars.

Four stars.

Four stars.

Five stars.

# of Funds

1,138

1,138

1,052

787

Mid Cap Value Fund
Morningstar Rating - I Class

Morningstar Category - Mid-Cap Value

Overall

3 Year

5 Year

10 Year

Ratings

Five stars.

Four stars.

Four stars.

Five stars.

# of Funds

391

391

361

268

ALL DATA AS OF 6/30/2022. SOURCE: MORNINGSTAR.

The Morningstar Rating™ for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The Morningstar Rating does not include any adjustment for sales loads. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10- year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.