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JPMorgan California Tax Free Bond A JCBAX

Medalist Rating as of | See JPMorgan Investment Hub
  • NAV / 1-Day Return 10.28  /  +0.10 %
  • Total Assets 301.8 Mil
  • Adj. Expense Ratio
    0.550%
  • Expense Ratio 0.550%
  • Distribution Fee Level Low
  • Share Class Type Front Load
  • Category Muni California Intermediate
  • Credit Quality / Interest Rate Sensitivity Medium/Moderate
  • Min. Initial Investment 1,000
  • Status Open
  • TTM Yield 2.61%
  • Effective Duration 5.38 years

USD | NAV as of Jun 14, 2024 | 1-Day Return as of Jun 14, 2024, 10:53 PM GMT+0

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Morningstar’s Analysis JCBAX

Medalist rating as of .

JPMorgan California Tax Free Bond A boasts strong Process and People Pillar ratings, but other weaknesses hold this strategy's Morningstar Medalist Rating at Neutral.

Our research team assigns Neutral ratings to strategies they’re not confident will outperform a relevant index, or most peers, over a market cycle on a risk-adjusted basis.

JPMorgan California Tax Free Bond A boasts strong Process and People Pillar ratings, but other weaknesses hold this strategy's Morningstar Medalist Rating at Neutral.

null Morningstar Manager Research

Morningstar Manager Research

Summary

The strategy charges fees in line with its similarly distributed peers, priced within the middle quintile.

The strategy's effective investment philosophy supports an Above Average Process Pillar rating. Independent of the rating, analysis of the strategy's portfolio shows it has maintained an underweight position in A rated bonds and an overweight in debt with 10- to 15-year maturities compared with category peers. The longest-tenured manager's extensive experience drives the strategy's Above Average People Pillar rating. The strategy's parent organization earns the firm an Above Average Parent Pillar rating, and this rating is inherited from vehicles belonging to the same branding entity and is indirectly assigned by an analyst.

Rated on Published on

Morningstar's evaluation of this fund's process seeks to understand management's investment philosophy, and whether it has been applied consistently over time and can add value across the market cycle.

null Morningstar Manager Research

Morningstar Manager Research

Process

Above Average

JPMorgan California Tax Free Bond Fund earns an Above Average Process Pillar rating.

The most notable contributor to the rating is the parent firm's five-year risk-adjusted success ratio of 57%. The measure indicates the percentage of a firm's funds that survived and outperformed their respective category's median Morningstar Risk-Adjusted Return for the period. The parent firm's excellent risk-adjusted performance, as shown by its average 10-year Morningstar Rating of 3.3 stars, also contributes to the process. Lastly, the process is limited by the number of months that the management team has been running this vehicle together.

Compared with other funds in the Muni California Intermediate Morningstar Category, this fund takes on lower credit risk. But in terms of long-term interest-rate sensitivity, it hews closely to its average peer over the past few years. Opening the analysis to additional factors, the portfolio has displayed biases over time, whether towards or away from certain fixed-income instruments. Relative to the category average, the managers have been underweight A rated bonds in recent years. In the latest month, the strategy has also relatively underweighted A rated bonds compared with Morningstar Category peers. Additionally, there's been a notable overallocation to debt with 10- to 15-year maturities over the past few years. Compared with category peers, the strategy had more exposure to debt with 10- to 15-year maturities in the most recent month. Finally, during the past few years, the fund leaned away from corporate debt. Nevertheless, the fund's corporate debt exposure was in line with peers in the latest month.

This strategy has a modest 2.6% 12-month yield, lower than its average peers' 2.7%. It also has a 2.9% 30-day SEC yield (a standardized, point-in-time estimate of the fund’s future income return). While a lower yield may deliver less income, it also tends to indicate lower credit risk. But that isn't always the case. Over the past 12 months, the average yield of the fund has been lower than the average yield of its Morningstar Category peers. The portfolio's average surveyed credit quality is on par with peers, with both the fund and the average being rated A.

Rated on Published on

JPMorgan California Tax Free Bond Fund earns an Above Average People Pillar rating.

null Morningstar Manager Research

Morningstar Manager Research

People

Above Average

Michelle V. Hallam’s veteran status, with 20 years of listed portfolio management experience, brings a wealth of experience to the table. Although the team is small, it is a solid supporting cast. Together, the three listed managers boast more than an average of 10 years of listed portfolio management experience. As a team, they manage two investment vehicles together, with mixed prospects. The asset-weighted algorithmically-assigned average Morningstar Medalist Rating across the strategies is Neutral. This means, in aggregate, they are not positioned to deliver positive alpha. None of the portfolio managers here invest in this fund. This hurts the rating because manager investment would align their interests with the strategy's investors.

Note: The People Pillar rating is indirectly assigned by an analyst. At least one of the managers on this fund manages a different product rated by an analyst. The analyst-assigned People Pillar rating(s) for these managers are combined with algorithmic scores for any non-covered managers on a tenure-weighted basis.

Rated on Published on

A well-resourced, thoughtful, and disciplined steward of client assets, JPMorgan Asset Management maintains an Above Average Parent rating.

Associate Director Emory Zink

Emory Zink

Associate Director

Parent

Above Average

As of 2022, this investment stalwart manages more than USD 2.5 trillion in AUM. Composed of various global cohorts and diverse asset classes, the firm has more tightly integrated its capabilities in recent years, notably through the development of proprietary analytical and risk systems. Investment teams are robustly staffed and helmed by seasoned contributors. The firm’s strategies tend to produce reliable portfolios, and several flagship offerings are Morningstar Medalists. Manager incentives align with fundholders'; compensation reflects longer-term performance factors, and portfolio managers invest in the firm’s strategies as part of their compensation plans.

The firm’s funds tend to be well-priced, but they aren’t as competitive as many highly regarded peers of similar scale. Recent product launches include thematic and single-country strategies, both of which carry the potential for volatile performance and flows, along with misuse by investors. The firm remains intrepid when it comes to developing an environmental, social, and governance-focused framework and continues to move into other areas such as direct indexing through its 55iP acquisition and China through its joint venture, but these complicated initiatives take time to assess any real and lasting effect.

Rated on Published on

This strategy’s A share class has not kept up with its peers or the category benchmark.

null Morningstar Manager Research

Morningstar Manager Research

Performance

Specifically, this share class trailed its average peer by 27 basis points annualized over a 10-year period. It also trailed the category benchmark, Bloomberg Barclays MF California Intermediate Municipal Bond Index, by an annualized 41 basis points over the same period.

When risk is properly accounted for, the strategy is not any more compelling. The share class trailed the index with a lower Sharpe ratio, a measure of risk-adjusted returns, over the trailing 10-year period. This subpar risk-adjusted performance has not resulted in higher volatility, as measured by their standard deviation, which is close to the benchmark. Finally, the share class proved itself ineffective as it was unable to generate alpha, over the same 10-year period, against the category group index: a benchmark that encapsulates the performance of the broader asset class.

Published on

Returns vary from period to period, but expenses are always subtracted.

null Morningstar Manager Research

Morningstar Manager Research

Price

It is good practice to weigh them heavily in any investment evaluation. This share class is in the middle quintile of its Morningstar Category. Its average expense ratio, paired with the fund’s People, Process, and Parent Pillars, indicates that this share class could struggle to deliver positive alpha compared with its category benchmark, explaining its Morningstar Medalist Rating of Neutral.

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Portfolio Holdings JCBAX

  • Current Portfolio Date
  • Equity Holdings
  • Bond Holdings
  • Other Holdings
  • % Assets in Top 10 Holdings 13.3
Top 10 Holdings
% Portfolio Weight
Market Value USD
Sector

JPMorgan Instl Tx Fr Mny Mkt Agcy

5.13 15.6 Mil
Cash and Equivalents

CALIFORNIA ST 4%

1.99 6.0 Mil
municipal

LOS ANGELES CALIF DEPT WTR & PWR REV 5%

1.85 5.6 Mil
municipal

CALIFORNIA HEALTH FACS FING AUTH REV 3%

1.65 5.0 Mil
municipal

CALIFORNIA HEALTH FACS FING AUTH REV 5%

1.20 3.6 Mil
municipal

LOS ANGELES CALIF HBR DEPT REV 5%

1.18 3.6 Mil
municipal

CALIFORNIA ST ENTERPRISE DEV AUTH STUDENT HSG REV 5%

1.14 3.5 Mil
municipal

UNIVERSITY CALIF REVS 5%

1.10 3.3 Mil
municipal

SOUTHERN CALIF PUB PWR AUTH SOUTHN TRANSMISSION SYS RENEWAL PROJ REV 5%

1.10 3.3 Mil
municipal

GLENDALE CALIF ELEC REV 5%

1.07 3.2 Mil
municipal