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JPMorgan US Sustainable Leaders I JIISX

Medalist Rating as of | See JPMorgan Investment Hub
  • NAV / 1-Day Return 66.72  /  +1.32 %
  • Total Assets 198.3 Mil
  • Adj. Expense Ratio
    0.390%
  • Expense Ratio 0.390%
  • Distribution Fee Level Low
  • Share Class Type Institutional
  • Category Large Blend
  • Investment Style Large Growth
  • Min. Initial Investment 1.0 Mil
  • Status Open
  • TTM Yield 0.88%
  • Turnover 39%

USD | NAV as of Apr 23, 2024 | 1-Day Return as of Apr 23, 2024, 10:14 PM GMT+0

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Morningstar’s Analysis JIISX

Medalist rating as of .

JPMorgan US Sustainable Leaders I’s management team is rated Average, but a solid investment process still helps this strategy retain its Morningstar Medalist Rating of Bronze.

Our research team assigns Bronze ratings to strategies they’re confident will outperform a relevant index, or most peers, over a market cycle on a risk-adjusted basis.

JPMorgan US Sustainable Leaders I’s management team is rated Average, but a solid investment process still helps this strategy retain its Morningstar Medalist Rating of Bronze.

null Morningstar Manager Research

Morningstar Manager Research

Summary

The portfolio maintains a sizable cost advantage over competitors, priced within the second-lowest fee quintile among peers.

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 overweight in liquidity exposure and volatility exposure compared with category peers. High liquidity exposure is attributed to stocks with a high trading volume, lending managers more flexibility. And high volatility exposure is rooted in stocks that have a higher standard deviation of returns. The strategy’s management team earns an Average People Pillar rating. The strategy's parent organization earns the firm an Above Average Parent Pillar rating. People Pillar and Parent Pillar ratings for this strategy are indirectly assigned by a Morningstar analyst rather than algorithmically derived. Please see the notes following each pillar section for more details. The details of assigning methods can be found in each pillar section.

Rated on Published on

Morningstar's evaluation of this fund's process seeks to determine how repeatable, consistent, and reliable it is, and whether management maintains a competitive advantage.

null Morningstar Manager Research

Morningstar Manager Research

Process

Above Average

JPMorgan U.S. Sustainable Leaders Fd earns an Above Average Process Pillar rating.

The primary 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 beat their respective category's median Morningstar Risk-Adjusted Return for the period. The parent firm's superior risk-adjusted performance, as shown by its average 10-year Morningstar Rating of 3.3 stars, also strengthens the process. Lastly, the process is limited by being an actively managed strategy. Historical data, like Morningstar's Active/Passive Barometer, finds that actively managed funds have generally underperformed their passive counterparts, especially over longer time horizons.

This strategy, over time, has preferred smaller market-cap companies, compared with others in the Large Blend Morningstar Category. But in terms of investment style, it is on par with peers. Analyzing additional factors, the fund has held stocks with higher trading volumes compared to Morningstar Category Peers in the past few years. Such stocks may have less potential upside than illiquid holdings, but they are easier to trade during market downturns. In recent months, the strategy was more exposed to the Liquidity factor compared with its Morningstar Category peers as well. 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, the strategy had similar exposure to high-quality stocks compared with Morningstar Category peers in recent months. 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 technology by 2.8 percentage points in terms of assets compared with the category average, and its financial services allocation is similar to the category. The sectors with low exposure compared to category peers are consumer defensive and energy, with consumer defensive underweighting the average portfolio by 2.8 percentage points of assets and energy similar to the average. The strategy owns 76 securities and is diversified among those holdings. In its most recent portfolio, 39.2% of the portfolio's assets were concentrated in the top 10 fund holdings, compared to the category average's 48.8%. And in closing, in terms of portfolio turnover, this portfolio's holdings turn over more often than comparable products in its peer group, possibly resulting in higher costs for investors and a drag on performance.

Rated on Published on

JPMorgan U.S. Sustainable Leaders Fd earns an Average People Pillar rating.

null Morningstar Manager Research

Morningstar Manager Research

People

Average

The strategy is backed by Andrew Stern, the longest-tenured manager, who has been a listed portfolio manager for five years. The average Morningstar Rating of the strategies they currently manage is 3.1 stars, indicating that their risk-adjusted returns have been in line with the category average. Andrew Stern draws on only two other listed supporting managers. Although, together they are adequately equipped, with eight years of average listed portfolio management experience. The highest personal investment in the fund by any of its managers is between$ 100,000 and$ 500,000. That's on the low side--it would need to be more than$ 1 million for us to see the investment as sufficient to promote the strong alignment of their interests with the strategy's investors.

Note: The People Pillar rating is indirectly assigned by an analyst. The longest-tenured manager of the fund also manages a different product rated by an analyst. Their analyst-assigned People Pillar rating is combined here with the People scores (algorithmic or analyst-assigned) for the fund’s other 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 Institutional share class' long-term performance is mixed depending on its comparison point.

null Morningstar Manager Research

Morningstar Manager Research

Performance

It has provided superior returns compared with peers, but poor returns compared with the category benchmark. Over a 10-year period, this share class outperformed the category’s average return by 1.6 percentage points annualized. But despite the above-average returns, it trailed the category benchmark, Russell 1000 Index, by an annualized 34 basis points over the same period.

When adjusting for risk, this fund is not compelling. The share class failed to beat the index with a lower Sharpe ratio, a measure of risk-adjusted returns, over the trailing 10-year period. But notably, these subpar risk-adjusted results have not come with more volatility than the benchmark, as measured by standard deviation. 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

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 sits in the second-cheapest quintile of its Morningstar Category. Its low expense ratio, considered jointly with the fund’s People, Process, and Parent Pillars, indicates that this share class is well-positioned to generate positive alpha against its category benchmark, leading to its Morningstar Medalist Rating of Bronze.

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Portfolio Holdings JIISX

  • Current Portfolio Date
  • Equity Holdings
  • Bond Holdings
  • Other Holdings
  • % Assets in Top 10 Holdings 39.9
Top 10 Holdings
% Portfolio Weight
Market Value USD
Sector

Microsoft Corp

8.51 17.0 Mil
Technology

Apple Inc

5.49 11.0 Mil
Technology

NVIDIA Corp

5.04 10.1 Mil
Technology

Alphabet Inc Class A

4.38 8.8 Mil
Communication Services

Amazon.com Inc

4.33 8.7 Mil
Consumer Cyclical

Mastercard Inc Class A

3.84 7.7 Mil
Financial Services

Costco Wholesale Corp

2.55 5.1 Mil
Consumer Defensive

UnitedHealth Group Inc

2.13 4.3 Mil
Healthcare

Bank of America Corp

1.84 3.7 Mil
Financial Services

Lowe's Companies Inc

1.79 3.6 Mil
Consumer Cyclical