JPMorgan International Bond Opportunities ETF JPIB

JPMorgan International Bond Opportunities ETF benefits from an experienced management team, extensive firm resources, and a nimble investment process.

In September 2020, JPMorgan Global Bond Opportunities ETF was renamed JPMorgan International Bond Opportunities ETF, reflecting the significant shift in the investment universe from 40% ex-US to 80% ex-US. The benchmark changed from the Bloomberg Multiverse Index Hedged to USD to the Bloomberg Barclays Multiverse Index ex USA Hedged to USD. Despite these changes, the investment process, total return objective, and 5%-10% volatility target remain unchanged.

The strategy aims to maximize total return within its volatility target and retains considerable flexibility to invest across a variety of sectors, such as high-yield and investment-grade corporates, emerging markets, and securitized debt.

Macro decisions are the dominant driver of the process. The comanagers and sector team heads debate the macro environment at quarterly meetings, which define the team’s top-down investment road map. During the weekly sector team meetings, fundamental, quantitative, and technical research inputs are generated for every sector, which help fine-tune the asset allocation. We have confidence in the team’s ability to proactively reduce risk and modify exposures to limit drawdowns in periods of market stress.

Global fixed-income chief investment officer Bob Michele and international (ex-US) fixed-income chief investment officer Iain Stealey comanage the strategy. In 2020, three comanagers were added: Lisa Coleman, head of global investment-grade corporate credit; Peter Aspbury, a high-yield portfolio manager; and Diana Amoa, an emerging-markets portfolio manager who joined the firm in 2015 but left in April 2021.

In April 2025, JPMorgan announced that Coleman would retire in March 2026. Andreas Michalitsianos, who has 24 years of credit portfolio management experience and has worked closely with Coleman for the past 17 years, was added as a comanager responsible for investment-grade starting April 1, 2025, while he also became head of global investment-grade corporate credit in October 2025.

Over the long term, we expect that the exchange-traded fund will have a similar return profile to the previous version as they follow the same process, have the same risk/reward targets, and are expected to have similar themes, albeit with a different geographical allocation.

The ETF has a short track record since the strategy’s transition in September 2020 but outperformed its peers and Morningstar Category index up to the end of March 2026. Its previous version outperformed peers from its inception in 2017 to the time of the transition in September 2020. For most of the time since inception, the large stake in high-yield debt has ranged between 35% and 65%. The bulk of high-yield exposure has stemmed from corporate credit and emerging-market debt and has been beneficial in a generally benign market environment. The team has exercised sound judgment in reducing that stake when valuations appear less compelling and during periods of market turmoil.

The team’s allocation decisions have been generally effective, often allowing the strategy to participate in the upside for risk assets during benign markets, while proactive risk reduction has helped in periods of turmoil, leading to a Process rating of Above Average. The relatively new ETF version uses the same process as the JPMorgan Global Bond Opportunities strategy and has the same volatility target of 5%-10% and total return objective. However, this new version has a different investment universe: 80% ex-US rather than 40% previously. Another key difference is that the ETF does not have exposure to loans and convertible bonds (average 5% in the global strategy). Its investment universe still includes a wide range of fixed-income sectors.

Macro decisions are the dominant driver of the process. Quarterly meetings between the comanagers and sector team heads define the top-down investment road map. During the weekly sector team meetings, fundamental, quantitative, and technical research inputs are generated for every sector and are used in the weekly portfolio strategy meeting to fine-tune the asset allocation. This is driven by each sector’s expected return and conviction level. Sector teams play a vital role in credit selection. The strategy’s broad guidelines include a 75% limit to high-yield exposure, and duration can range from negative 2.0 to positive 8.0 years, but, in practice, it has never been negative.

As of January 2026, the strategy had a duration of 5.1 years, a very similar level compared with a year prior. The bulk of duration comes from exposure to credit (2.4 years), emerging markets (1.3 years), and government bonds (1.3 years, mainly UK, Australia, Canada, and Italy).

From an asset-allocation perspective and in line with its new parameters, the fund held about 80% outside the US, with around 15% in the US, and 5% in cash. Corporate credit accounts for 57% (from 59% a year ago), including 23% in high yield. Within high yield, there is a preference toward defensive sectors and high-quality companies as opposed to the lower-quality part of the high-yield market. The managers continued to favor investment-grade corporate credit with a roughly similar allocation to a year ago, at around 35%. The strategy has a preference for banks and corporate hybrids.

Exposure to emerging-market debt stood at 23% (up from 20% a year before) and included a 14.3% stake in local-currency debt, a 6.4% stake in hard-currency sovereigns, and 1.9% in corporate bonds. Securitized debt accounted for 0.2% (from 1% a year ago), using a very small part of the fund’s US allowance. It consisted of diversified exposure in mortgage-backed and asset-backed securities.

The strategy is comanaged by global fixed-income chief investment officer Bob Michele, who joined in 2008 from Schroders, and international fixed-income chief investment officer Iain Stealey, who joined in 2002. Nicholas Gartside's departure in 2019 did not disrupt the fund, as Michele and Stealey, comanagers since inception, ensured continuity.

The managers primarily focus on the fund’s top-down positioning; Michele focuses on US macro, while Stealey is more focused on the non-US side, mainly Europe. They rely on the expertise of JPMorgan’s sector specialist teams for idea generation and security selection across currency, rates, credit, securitized, and emerging-market debt. As part of the remit’s transition and in recognition of their contributions to idea generation and returns, three comanagers were added in 2020: Lisa Coleman, head of global investment-grade corporate credit, who joined in 2008; Peter Aspbury, a European high-yield specialist who joined in 2010; and Diana Amoa, who focuses on emerging markets and joined in 2015. Amoa left in April 2021, but her departure did not cause any disruption, given the team-based approach.

In April 2025, JPMorgan announced that Coleman would retire in March 2026. Andreas Michalitsianos, who has 24 years of credit portfolio-management experience and has worked closely with Coleman for the past 17 years, was added as a comanager responsible for investment-grade effective April 1, 2025, while he also became the head of global investment-grade corporate credit in October 2025. We are comfortable that Michalitsianos will be able to adequately replace Coleman, given his tenure and experience.

Our conviction here is driven by the experience and portfolio-management skills of the lead managers, the tenures of the comanagers, and the depth and quality of the available sector team resources. We maintain the People Pillar rating at Above Average.

J.P. Morgan continues to build a track record of strong stewardship, supporting a Parent rating upgrade to High from Above Average.

With more than USD 4 trillion in assets under management (including USD 1.3 trillion in money market funds) and a broad reach, J.P. Morgan is among the largest active asset managers in the US, Europe, and Asia. Although some multi-asset offerings have struggled over the past five years, prompting new leadership to make changes to investment teams, its equity and fixed-income teams boast long-tenured portfolio managers who practice repeatable investment processes that have generally produced strong long-term results. Most of its funds are core building blocks with long lifetimes, though its lineup around the world also includes more-specialized options: Two options-based equity-income exchange-traded funds, launched in 2020 and 2022, are now among the firm’s largest. J.P. Morgan has been an early mover in offering active ETFs, having converted 12 of its open-end mutual funds to the structure and launching others. It isn’t always at the forefront of emerging trends. While it has filed registration statements with the Securities and Exchange Commission for an interval fund and an ETF investing in private markets, it hasn’t yet introduced such an option for all investors, whether on its own or in partnership with another asset manager, unlike some of its closest competitors.

To support the firm’s diverse investment offerings, J.P. Morgan has invested heavily in both portfolio management tools and its client organization. Over the past 10 years, the firm has developed robust proprietary technology with advanced analytics and broad buy-in from investment analysts, portfolio traders, and portfolio managers, all of whom have easy access to the platform. The firm also stands apart for its demonstrated commitment to clients. In the early 2000s, J.P. Morgan began pivoting its engagement with financial advisors to adopt a more consultative approach, supported by its sought-after Guide to the Markets research series that focuses on investor education, not product pitches. This perspective can help clients stay the course, supporting positive investor outcomes.

Incentives reinforce alignment with fundholders. Beginning more than 10 years ago, investment team compensation is tied to three-, five-, and 10-year performance, and portfolio managers must invest at least half of their deferred compensation in J.P. Morgan strategies. Many firms encourage portfolio managers to invest alongside fundholders, but J.P. Morgan goes a step further in requiring client-facing individuals to invest substantial portions of their incentive compensation in the funds.

Although some funds still face high cost hurdles, more than half of share classes charge competitive fees relative to peers.

The International Bond Opportunities ETF has a relatively short track record since shifting from a global (40% ex-US) to a more international (80% ex-US) mandate in September 2020, but it has outperformed both peers and its category index through March 2026. Its predecessor strategy also delivered consistent outperformance from its 2017 inception to the 2020 transition. Despite the geographic shift, the process, risk/return objectives, and thematic approach remain unchanged, suggesting a broadly similar long-term return profile.

The team has demonstrated an ability to add value through asset allocation, even in challenging environments. Early positioning in US high yield and emerging markets supported returns in 2017, while 2019 benefited from a rebound in risk assets and accommodative central bank policy. During the 2020 covid-19 shock, the strategy outperformed through government-bond exposure, currency positioning, and defensive trades.

In 2022, a difficult year for bonds, the ETF fell 5.9% but still outperformed peers and its benchmark significantly, driven primarily by a net short-duration stance in government bonds. Tactical hedges and risk management helped limit downside. Performance remained strong in subsequent years: the ETF returned 7.8% in 2023 and 3.9% in 2024, supported by credit and emerging-market exposure. In 2025, it delivered 8.2%, outperforming peers by 3.2%, with contributions from emerging-market debt, investment-grade and high-yield corporates, and securitized assets.

JPMorgan International Bond Opps ETF's Prospectus Adjusted Expense Ratio is 0.5% per year. It places it in the second-cheapest quintile of the Morningstar US Fund Global Bond-USD Hedged Category, where the median fee is 0.61% per year. This cost positioning translates into a Medalist Rating Price Score of 0.98, which reflects its relative price positioning within the category. The Price Score ranges from -2.50 (most expensive) to +2.50 (cheapest), with higher scores indicating better cost competitiveness.