JPMorgan Strategic Income Opports Fd earns an Above Average Process Pillar rating.
The main contributor to 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 stability of talent across its parent firm also contributes to the process. The firm's asset-weighted manager tenure of 16 years demonstrates its ability to retain portfolio managers. 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 Nontraditional Bond 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 average strategy in the category, the managers have been substantially underweight BB rated bonds. Additionally, there's been a notable bias away from debt with 20- to 30-year maturities. And finally, the fund leans meaningfully toward cash.
This strategy's 12-month yield is 3.9%, lower than its average peers' 4.8%. Plus, its 30-day SEC yield (a measure similar to yield-to-maturity) sits at 4.3%. A lower yield tends to indicate lower credit risk. The portfolio has a higher average surveyed credit quality of BBB, compared with the typical peers' BB, and its non-investment-grade stake is 5% of assets, compared with its average peers' 23%. Strategies with lower credit risk can typically withstand market turmoil more effectively.