JPMorgan Developed International Val Fd earns a High Process Pillar rating.
The largest contributor to the rating is the fund's excellent 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 five-year risk-adjusted success ratio of 57% also influences the rating. 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. Their compelling success ratio suggests that the firm does well for investors and that this fund may benefit from that. The parent firm's strong risk-adjusted performance, as shown by its average 10-year Morningstar Rating of 3.3 stars, influences the rating as well.
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 surpass 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. This contributes to a higher-risk, higher-reward approach. Compared with category peers, the strategy also had more exposure to the Volatility factor in the most recent month. Additionally, the managers have tended to overweight yield, shown by the portfolio's high exposure to stocks paying dividends or buying back shares. 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 energy relative to the category average by 10.3 and 2.9 percentage points, respectively. The sectors with low exposure compared to category peers are technology and consumer defensive, underweight the average by 6.7 and 5.6 percentage points of assets, respectively. The portfolio is positioned across 232 holdings and is relatively concentrated. In particular, 18.1% of the strategy's assets are housed within the top 10 holdings, compared with the category’s 13.9% average. And in closing, in terms of portfolio turnover, looking at year-over-year movements, 34% of the fund's holdings have turned over, whether through increasing, decreasing, or changing a position.