JP Morgan launches first ETF
JP Morgan Asset Management’s first exchange-traded fund, the JPMorgan Diversified Return Global Equity (JPGE), has opened for trading.
JP Morgan believes the new fund represents the next generation of strategic beta ETFs, seeking to provide global equity returns from four distinct return factors and reduced volatility by diversifying risks across regions and sectors. It is designed to be a core global equity allocation.
JPMorgan Diversified Return Global Equity is a strategic beta, developed market equity ETF that tracks an index co-developed with FTSE Group – the FTSE Developed Diversified Factor Index.
The fund is designed to provide market participation with lower volatility, and starts with the premise that traditional market-cap weighted and single-factor indices expose investors to excessive risk concentrations and a systematic bias toward overvalued securities. The fund seeks to reallocate risk by weighting stocks according to four factors: value, size, momentum and low volatility.
The fund is managed by an experienced JP Morgan team, with 18-year veteran Beltran Lastra as the lead portfolio manager. Lastra's team currently manages USD12 billion in AUM globally.
"We believe that JP Morgan has unique investment insights and global capabilities that will be attractive to ETF investors, and this product is an important first step in delivering those capabilities," says Robert Deutsch, head of the ETF business for JP Morgan Asset Management. "JP Morgan has grown to one of the largest global mutual fund managers and our ETF offering will be a natural extension our product line-up.
"We believe that the custom index co-developed with FTSE sets this fund apart and reflects a next-generation-style ETF that will be attractive to US investors.”
"We are delighted that JP Morgan has chosen FTSE as the index provider for launching their new ETF business in the US," says Jonathan Horton, president of FTSE North America. "Electing to work with FTSE to co-develop the methodology behind this ground-breaking multi-factor index series is a great example of combining JP Morgan's research and investment process know-how with our index expertise creating customised solutions in partnership with clients."
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