JPMorgan Tax Free Bond C JTFCX

Fees are a weakness here. The strategy's lofty fees are a high hurdle to clear, as it is priced within the most expensive quintile among peers.

The strategy’s management team earns an Above Average People Pillar rating. The strategy's investment approach stands out and earns an Above Average Process Pillar rating. Independent of the rating, analysis of the strategy's portfolio shows it has maintained an underweight position in A rated bonds and has a considerable overweight in cash compared with category peers. 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.

JPMorgan Tax Free Bond Fund earns an Above Average Process Pillar rating.

The leading factor in the rating is its parent firm's impressive long-term risk-adjusted performance, as shown by the firm's average 10-year Morningstar Rating of 3.3 stars. The parent firm's five-year risk-adjusted success ratio of 59% also supports 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 commendable success ratio suggests that the firm does well for investors and that this fund may benefit from that. Lastly, the process is limited by the fund's unimpressive long-term risk-adjusted performance. This can be seen in its five-year information ratio calculated relative to the category average, which suggests that the process has struggled over that period.

Compared with other funds in the Muni National Long 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. Relative to the average strategy in the category, the managers have been underweight A rated bonds. Additionally, the managers have exhibited a notable sector bias toward cash. And finally, the fund leans away from debt with 20- to 30-year maturities.

This strategy's 12-month yield is 2.8%, lower than its average peers' 3.2%. In addition, it has a 3.2% 30-day SEC yield (a measure similar to yield-to-maturity). Typically, a lower yield comes with the benefit of less credit risk. But that isn't always the case. Over the past 12 months, the average yield of the fund has been lower than the average yield of its Morningstar Category peers. The portfolio has a lower average credit rating of BBB, compared with the category average's A and its non-investment-grade stake is 4% of assets, compared to its peers' 1%. Strategies with more credit risk may have a higher return, but they are riskier.

Richard D. Taormina’s veteran status, with over 25 years of portfolio management experience, brings a wealth of experience to the table. The strategies they currently manage have an average Morningstar Rating of 2.6 stars, demonstrating disappointing risk-adjusted performance compared with category peers. Richard D. Taormina has an experienced listed co-manager. Together, they average 22 years of portfolio management experience.

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.

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.

Over a 10-year period, this share class undershot its average peer by 69 basis points annualized. It was also not able to clear the hurdle set by the category index, Bloomberg Barclays Municipal Bond Index, where it trailed by an annualized 1.1 percentage points over the same period.

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.

This share class is within the costliest quintile of its Morningstar Category. Its steep fee, in conjunction with the fund’s People, Process, and Parent Pillars, indicates that this share class could struggle to deliver positive alpha relative to its category benchmark, leading to its Morningstar Medalist Rating of Neutral.