CIO Insights: Nuanced Insights for Volatile Global Markets

This quarter’s CIO Insights have centered around the return of volatility to global financial markets and the implications of this volatility for investors.

The disciplined equity investment philosophy that has delivered strong results in our U.S. strategies has also worked well in non-U.S. markets. Nevertheless, the specific drivers of stock returns need to be customized for local markets. This is because factors or insights that work well in the U.S. do not always have similar risk/reward profiles in other areas. For example, some growth ideas and insights that are no longer compelling or effective in the U.S., where markets are comparatively more efficient, may still be effective in a global, non-U.S. context.

Read Wittman’s full Q2 2015 CIO Insight: CIO Insights: Nuanced Insights for Volatile Global Markets

Bottom line: Companies that achieve business success, whether in the U.S. or around the world, naturally tend to attract capital. We believe that our unemotional, fundamentally based analysis of the thousands of companies in Europe, Japan, and Asia can identify these stocks. In addition, we actively incorporate risk management techniques into our portfolios to limit risk exposures relative to our underlying benchmarks. Finally, we believe that systematically evaluating and incorporating past experience and learnings into our investment processes bodes well for such strategies in the future.

International investing involves special risks, such as political instability and currency fluctuations.

Investment return and principal value of security investments will fluctuate. The value at the time of redemption may be more or less than the original cost.

The opinions expressed are those of Scott Wittman, CFA, CAIA, and are no guarantee of the future performance of any American Century Investments portfolio.

For educational use only. This information is not intended to serve as investment advice. Past performance is no guarantee of future results.