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JPMorgan Developed International Value A JFEAX

Medalist Rating as of | See JPMorgan Investment Hub
  • NAV / 1-Day Return 14.48  /  +0.91 %
  • Total Assets 560.4 Mil
  • Adj. Expense Ratio
    1.000%
  • Expense Ratio 1.000%
  • Distribution Fee Level Low
  • Share Class Type Front Load
  • Category Foreign Large Value
  • Investment Style Large Value
  • Min. Initial Investment 1,000
  • Status Open
  • TTM Yield 4.36%
  • Turnover 34%

USD | NAV as of Jun 12, 2024 | 1-Day Return as of Jun 12, 2024, 11:32 PM GMT+0

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Morningstar’s Analysis JFEAX

Medalist rating as of .

A sound investment process and strong management team underpin JPMorgan Developed International Value A's Morningstar Medalist Rating of Silver.

Our research team assigns Silver ratings to strategies that they have a high conviction will outperform the relevant index, or most peers, over a market cycle on a risk-adjusted basis.

A sound investment process and strong management team underpin JPMorgan Developed International Value A's Morningstar Medalist Rating of Silver.

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 a High Process Pillar rating. Independent of the rating, analysis of the strategy's portfolio shows it has maintained a significant underweight position in quality exposure and an overweight in volatility exposure compared with category peers. Low quality exposure is attributed to stocks with higher financial leverage and lower profitability. And high volatility exposure is rooted in stocks that have a higher standard deviation of returns. The management team's large personal investment in the strategy helps it earn an 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.

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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

High

JPMorgan Developed International Val Fd earns a High Process Pillar rating.

The most significant contributor to the rating is the fund's impressive long-term risk-adjusted performance. This can be seen in its five-year alpha calculated relative to the category index, which suggests that the managers have shown skill in their allocation of risk. The parent firm's superior risk-adjusted performance, as shown by its average 10-year Morningstar Rating of 3.3 stars, also contributes to the process. The parent firm's five-year risk-adjusted success ratio of 57% supports the process. The measure indicates the percentage of a firm's funds that survived and beat their respective category's median Morningstar Risk-Adjusted Return for the period. Their relatively high success ratio suggests that this firm does well for investors and that this fund may benefit from that.

This strategy leans toward smaller, more value-oriented companies compared with its average peer in the Foreign Large Value Morningstar Category. Examining additional factor exposure, this strategy has consistently favored low-quality stocks compared with Morningstar Category peers over the past few years. Lacking this ballast, the fund's prospects could rest on its ability to beat peers during economic booms. In the latest month, the strategy was also less exposed to the Quality factor compared with Morningstar Category peers. This strategy has also exhibited a tilt toward high-volatility stocks over these years, meaning it has invested in companies that have a higher historical standard deviation of returns. Such stocks tend to rise faster and fall harder than the broad market. High-volatility exposure contributes to stronger performance during bull markets, but often at the cost of losing more during downturns. Compared with category peers, the strategy also had more exposure to the Volatility factor in the most recent month. Additionally, this strategy's portfolio has held more stocks with high dividend or buyback yields than peers over recent years. Stocks with high yields can be more stable, mature companies, but at times extreme market pressure or fundamental deterioration may prompt them to cut their dividends, which tends to hurt stock performance. In this month, the strategy also had more exposure to the Yield factor over its peers. More information on a fund and its respective category's factor exposure can be found in the Factor Profile module within the Portfolio section.

The portfolio is overweight in financial services and consumer cyclical relative to the category average by 11.3 and 3.2 percentage points, respectively. The sectors with low exposure compared to category peers are technology and consumer defensive, underweight the average by 7.4 and 5.7 percentage points of assets, respectively. The strategy owns 240 securities and is quite concentrated. More concretely, 17.1% of the portfolio's assets are housed within the top 10 holdings, as opposed to the category’s 13.7% average. And in closing, in terms of portfolio turnover, this fund trades less frequently than the category’s average, potentially limiting costs to investors.

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JPMorgan Developed International Val Fd earns an Above Average People Pillar rating.

null Morningstar Manager Research

Morningstar Manager Research

People

Above Average

The primary contributor to the rating is its parent firm's five-year success ratio of 57%. The measure indicates the percentage of a firm's funds that survived and beat their respective category's median return for the period. The portfolio managers' outperformance at the funds they run, as measured by their combined three-year manager excess returns, also supports the rating.

Michael Barakos’s veteran status, with over 25 years of listed portfolio management experience, brings a wealth of experience to the table. The team boasts an experienced corps of listed portfolio managers, with three others supporting Michael Barakos. Together, they average 17 years of listed portfolio management experience. The team has successfully retained portfolio-manager talent, providing continuity for strategies as long-term stability tends to support positive results. There have been no documented departures within the past five years.

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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' long-term performance is mixed depending on its comparison point.

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Morningstar Manager Research

Performance

It has provided mixed returns compared with peers, but similar returns compared with the category benchmark. Over an eight-year period, this share class' outperformed the category’s average by an annualized 34 basis points. But when expanded to a 10-year period, it underperformed the average by 29 basis points. However, it mirrored the return of the category index, the MSCI ACWI ex USA Value Index, over the 10-year period. One-year performance does not largely affect this share class' rating. However, its impressive 16.3% return is worth mentioning, a 7.0-percentage-point lead over its average peer, placing it within the top 10% of its category.

When adjusting for risk, this fund is competitive. The share class led the index with a higher Sharpe ratio, a measure of risk-adjusted return, over the trailing 10-year period. These strong risk-adjusted results have not come with a bumpier ride for investors. This strategy took on similar risk as the benchmark, as measured by standard deviation. However, 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.

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Low-cost investments routinely outperform high-cost investments.

null Morningstar Manager Research

Morningstar Manager Research

Price

Thus, assessing cost is a critical step in any investment evaluation. This share class is within the middle quintile of its Morningstar Category. Its modest expense ratio, paired with the fund’s People, Process, and Parent Pillars, suggests that this share class is well-positioned to generate positive alpha compared with its category benchmark, leading to its Morningstar Medalist Rating of Silver.

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Portfolio Holdings JFEAX

  • Current Portfolio Date
  • Equity Holdings
  • Bond Holdings
  • Other Holdings
  • % Assets in Top 10 Holdings 18.2
Top 10 Holdings
% Portfolio Weight
Market Value USD
Sector

Shell PLC

3.08 16.6 Mil
Energy

Novartis AG Registered Shares

2.76 14.9 Mil
Healthcare

TotalEnergies SE

2.09 11.3 Mil
Energy

HSBC Holdings PLC

1.65 8.9 Mil
Financial Services

Toyota Motor Corp

1.64 8.8 Mil
Consumer Cyclical

Mitsubishi UFJ Financial Group Inc

1.53 8.2 Mil
Financial Services

BP PLC

1.45 7.8 Mil
Energy

Allianz SE

1.39 7.5 Mil
Financial Services

BHP Group Ltd

1.34 7.2 Mil
Basic Materials

Mitsubishi Corp

1.27 6.8 Mil
Industrials