In July 2015, Timothy Armour became the chairman of Capital Group after his predecessor, James Rothenberg, died of a heart attack. Armour served as chairman of Capital Group’s management committee. The firm manages a client portfolio of $1.25 trillion, mostly in equity mutual funds.
After graduating from Vermont’s Middlebury College, Armour spent his entire professional career at Capital. He is considered a champion of active management and believes in following a steady course, even when investments dip during temporary downturns. Speaking of the company’s record with stock picks, he said, “Our number one mantra is we will get you better returns over time.”
Following the stock crash of 2008, investors have shied away from management firms reliant on stock exchanges. Instead, index funds and exchange-traded fund have been in vogue. While Capital Group replaced a few managers during the crisis, they actually hired more salespeople as veterans fled the field. Overall, the firm did not change its methodology for picking stocks likely to gain leverage over time.
“We believe in what we do even if at times the world doesn’t,” Armour told Bloomberg in 2004.
Janet Yang, CFA, praised Capital Group’s selection of Armour as company chairman. Yang cited Armour’s ability to identify business needs before they trend in the market. Accurate foresight is critical in the investing industry, and this ability provides a great advantage for Capital Group and its customers.
One bold move under Armour’s leadership involves the partnership between Capital Group and Samsung’s Asset Management, based in Seoul, Korea. The deal, closed in October 2015, combined Capital Group, with $1.4 trillion in assets, with Samsung Asset Management, with $166 billion. The news release for the merger stated that the two firms were looking to develop retirement solutions and asset allocation products.
Under the agreement, Capital Group will provide Samsung Asset Management with expertise on capital active management, especially as it relates to business management and client asset management. Sung-hoon Koo, Samsung’s CEO, predicted that the partnership would enable his firm to improve and upgrade equity investment efforts. SAM plans to integrate life cycle asset allocation into its investment offerings. Armour said that Capital Group hoped to utilize its new partner in designing solutions to grow savings, retirement and insurance accounts for Korean investors.
Find Tim Armour on LinkedIn.