JPMorgan National Municipal Income Fund earns an Above Average Process Pillar rating.
The most important driver of the rating is the parent firm's five-year risk-adjusted success ratio of 59%. 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 impressive risk-adjusted performance, as shown by its average 10-year Morningstar Rating of 3.3 stars, also bolsters the rating. 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.
Compared with other funds in the Muni National Interm Morningstar Category, this fund, historically, hews closely to peers' credit and interest-rate sensitivity. Opening the analysis to additional factors, the portfolio has displayed three biases over time, whether towards or away from certain fixed-income instruments. Compared with the category average, the managers have been underweight BBB rated bonds. Additionally, there's been an overweight position in debt with 10- to 15-year maturities. And finally, the fund does not consistently lean toward or away from corporate bonds, but the current portfolio is underweight.
This strategy's 12-month yield is 2.8%, higher than its average peer's 2.6%. It also has a 3.3% 30-day SEC yield (a measure similar to yield-to-maturity). Typically, higher yields come at the cost of higher credit risk. The portfolio has a lower average surveyed credit quality of BBB, compared with the typical peers' A and its non-investment-grade stake is 3% of assets, compared to its peers' 1%. Strategies with more credit risk may have a higher return, but they are riskier.