Capital Group, the Los Angeles-based asset manager overseeing nearly $150 billion in ETF assets, has filed registration statements with the Securities and Exchange Commission for two new multi-asset exchange-traded funds. The proposed funds—the Capital Group Multi-Asset Income ETF and the Capital Group Multi-Asset Income Builder ETF—are designed to address what the firm describes as persistent demand from financial advisors for actively managed income-oriented strategies.
According to the SEC filings, the Multi-Asset Income ETF will prioritize current income as its primary investment objective, with capital growth as a secondary goal. In contrast, the Multi-Asset Income Builder ETF aims to deliver a level of current income that exceeds the average yield on U.S. equities, while also targeting a growing income stream over time; capital appreciation is a secondary objective for that vehicle as well. Both funds are expected to launch late this year, subject to regulatory approval, Capital Group confirmed to InvestmentNews.
“Financial advisors have consistently told us they want actively managed ETFs to help meet their clients’ income needs,” said Scott Davis, head of ETFs at Capital Group, in a statement. “To meet that demand, we are leveraging Capital Group’s long history of combining equities and fixed income securities to meet income objectives and bring that capability into the ETF structure.” Davis added that the multi-asset ETF category has historically offered limited options for investors, and that the firm has been encouraged by the strong uptake of its Capital Group Core Balanced ETF (ticker: CGBL), which he noted has quickly become the largest moderate allocation ETF by assets under management.
The filings come as Capital Group continues to assert its position as the world’s largest active manager of ETFs, excluding firms that have converted mutual funds into the ETF wrapper. The company’s ETF platform has grown to approach $150 billion in assets under management, reflecting a broader industry trend toward active management in the ETF space. Advisors have increasingly turned to active ETFs for income generation, particularly in a rate environment where traditional fixed-income yields remain elevated but uncertain.
The new funds will invest across a mix of asset classes, including equities, fixed-income securities, and potentially other instruments, though the exact allocations will be determined by the portfolio managers. Capital Group’s multi-asset approach draws on its long-standing expertise in combining stocks and bonds, a capability the firm has honed over decades in its mutual fund lineup. The ETF structure offers tax efficiency and intraday trading, features that advisors have come to expect.
Industry observers note that the multi-asset ETF category has seen relatively few entrants compared to single-asset-class funds, leaving room for innovation. Capital Group’s move could intensify competition among asset managers vying for advisor allocations in the income-focused segment. The firm’s existing CGBL fund, which launched in 2022, has accumulated over $5 billion in assets, according to data from Morningstar, underscoring the appetite for balanced ETF strategies.
Advisors seeking to diversify client portfolios may also consider alternative investments, as highlighted in a recent Escalent survey showing affluent investors cutting alts targets amid rising risk awareness. Meanwhile, the broader wealth management landscape continues to evolve, with firms like Dynasty Financial Partners acquiring Optima Group to launch a consulting division for RIAs, signaling a push for more specialized advisory services.
Capital Group’s filing also reflects a strategic bet on the enduring appeal of income-generating strategies, even as the Federal Reserve’s rate path remains uncertain. With the new ETFs, the firm aims to provide advisors with tools to address both yield-seeking and total-return objectives within a single vehicle. The funds are expected to be managed by Capital Group’s investment teams, leveraging the firm’s research-driven approach.
As the ETF industry continues to expand, with total U.S. ETF assets surpassing $8 trillion, active managers like Capital Group are carving out a larger share. The success of the new funds will likely depend on their ability to deliver consistent income and competitive returns relative to passive alternatives. For now, advisors have another option to consider in their quest to meet clients’ income needs.
