Morningstar's evaluation of this fund's process aims to determine whether it has been applied consistently over time, as demonstrated by the portfolio's composition, its suitability for different types of investors, and expectations for performance in various market conditions, assuming the process is adhered to. JPMorgan Diversified Fund earns an Above Average Process Pillar rating.
This strategy is positioned similarly to Allocation--50% to 70% Equity peers, in terms of its fixed-income to equity breakdown, with a 31.9% to 60.0% fixed-income to equity weighting. Looking exclusively at the portfolio's equity sleeve, the strategy is consistently tilted toward both smaller market-cap and growth-oriented stocks compared with the category average. The strategy has three region or sector biases compared to category peers. The most meaningful exposure is to the Developed Europe region, where the portfolio is typically overallocated. It also maintains an overweight bias toward the consumer cyclical sector. And finally, the portfolio has maintained an underallocation to developed markets regions compared with peers.
The current holdings' average price/earnings ratio is 17.5 versus the typical category peer's 18.5. The low markup indicates that investors expect lower growth in the fund’s stocks compared with others held in the category. The portfolio is overweight in consumer cyclical by 2.9 percentage points in terms of assets compared with the average portfolio in the category, and its financial services allocation is similar to the category. The sectors with low exposure compared to their category peers are consumer defensive and communication services; however, the allocations are similar to the average category portfolio. The portfolio is overweight in Developed Europe and Japan regions relative to the average peer in its category by 10.5% and 3.8% of assets, respectively. The regions with low exposure compared to their category peers are North America and Middle East and Africa, with North America underweight the average portfolio by 16.6% of assets and Middle East and Africa
similar to the average.