American Balanced Fund: 50 years of delivering for investors

Graphic that says, Dedicated to delivering for investors; 50 years; American Balanced Fund(R)

Embrace the unknown with a time-tested investing approach

Since its inception in 1975, American Balanced Fund (AMBAL) has helped shepherd investors through wide-ranging market conditions with its well-balanced portfolio of high-quality stocks and bonds. Here's what makes it special...

Focused on three objectives

Decades later, the fund’s three-fold investment objectives of long-term growth of capital and income, conservation of capital and current income remain unchanged. The fund was initially designed to serve as the entire investment portfolio for a prudent investor. This tried-and-true approach has served investors well against the index through difficult market environments.

Read important investment disclosures

Index-beating lifetime results

The key behind its resilient track record? A combination of active flexibility, fundamental research and the pursuit of high-quality investment opportunities.

Learn more about the fund's 50-year history and how a 60% equity/40% fixed income portfolio generally works.

50 YEARS OF HISTORY THE 60/40 PORTFOLIO

A flexible approach to asset allocation

A three-pronged asset allocation approach is designed to help AMBAL navigate different market conditions.

Equities

Equities offer long-term growth potential through capital appreciation and dividends. They help the fund pursue higher returns, diversify risk and participate in market upside, especially when supported by strong fundamentals and disciplined portfolio management.

Fixed income

Fixed income helps provide a cushion and income through regular interest payments. It helps the fund manage volatility, preserve capital and balance equity exposure, especially during market downturns or economic uncertainty, supporting a more resilient and diversified investment strategy.

Cash and equivalents

Cash & equivalents offer liquidity and flexibility, allowing the fund to meet short-term obligations, seize investment opportunities and manage risk. It acts as a buffer during market stress and supports dynamic asset allocation, without forcing the sale of long-term holdings.

A fresh look at balanced portfolios

AMBAL seeks to provide a balanced approach to growth and income investing, blending equities and fixed income to promote diversification, competitive returns and help shelter from outsize volatility. Yet, compared to passively implemented 60% equity/40% fixed income solutions — where the asset allocation seeks to replicate the positioning of an index — the fund has a flexible, dynamic asset allocation approach that can shift within established guardrails in response to market conditions based on the research and convictions of the portfolio managers.


100% equity portfolio


 

PROS

  • Maximizes capital appreciation potential
  • Reduces longevity/shortfall risk

 

CONS

  • Higher expected volatility
  • Increased wealth variability



     


100% fixed income portfolio
 

PROS

  • Capital preservation focus, especially with high-quality bonds
  • Reduces market risk
  • Potential to generate income via
coupon payments

 

CONS

  • Increased credit default risk (at
higher yields)
  • Potential longevity/shortfall risk
     


60% equity/40% fixed income
 

PROS

  • Seeks a balance of objectives, including capital appreciation
and income
  • Can reduce drawdown and exposure to market selloffs

 

CONS

  • Limited capital appreciation potential vs. 100% equity portfolio
  • Higher downside risk vs. 100% fixed income portfolio

Pros and cons are in relation to the other stated hypothetical portfolios. For illustrative purposes only.

The power of active management

Watch as AMBAL portfolio manager Paul Benjamin and investment director Jacob Gerber talk about the fund, its history and what they are watching in the current market environment.

Figures shown are past results and are not predictive of results in future periods. Current and future results may be lower or higher than those shown. Investing for short periods makes losses more likely. Prices and returns will vary, so investors may lose money. View mutual fund expense ratios and returns. View current mutual fund SEC yields.
Investments are not FDIC-insured, nor are they deposits of or guaranteed by a bank or any other entity, so they may lose value.
Investors should carefully consider investment objectives, risks, charges and expenses. This and other important information is contained in the prospectuses and/or summary prospectuses, which can be obtained from a financial professional and should be read carefully before investing.
The return of principal for bond portfolios and for portfolios with significant underlying bond holdings is not guaranteed. Investments are subject to the same interest rate, inflation and credit risks associated with the underlying bond holdings.
There have been periods when the results lagged the index(es) and/or average(s). The indexes are unmanaged and, therefore, have no expenses. Investors cannot invest directly in an index.
Source: Bloomberg Index Services Limited. BLOOMBERG® is a trademark and service mark of Bloomberg Finance L.P. and its affiliates (collectively "Bloomberg"). Bloomberg or Bloomberg's licensors own all proprietary rights in the Bloomberg Indices. Neither Bloomberg nor Bloomberg's licensors approves or endorses this material, or guarantees the accuracy or completeness of any information herein, or makes any warranty, express or implied, as to the results to be obtained therefrom and, to the maximum extent allowed by law, neither shall have any liability or responsibility for injury or damages arising in connection therewith.
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Portfolios are managed, so holdings will change. Certain fixed income and/or cash and equivalents holdings may be held through mutual funds managed by the investment adviser or its affiliates that are not offered to the public.
Totals may not reconcile due to rounding.
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This content, developed by Capital Group, home of American Funds, should not be used as a primary basis for investment decisions and is not intended to serve as impartial investment or fiduciary advice.
© 2025 Morningstar, Inc. All Rights Reserved. Some of the information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete or timely. Neither Morningstar, its content providers nor Capital Group are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results. Information is calculated by Morningstar. Due to differing calculation methods, the figures shown here may differ from those calculated by Capital Group.