Skip to Content

JPMorgan Short Duration Bond C OSTCX

Medalist Rating as of | See JPMorgan Investment Hub
  • NAV / 1-Day Return 10.73  /  +0.09 %
  • Total Assets 7.5 Bil
  • Adj. Expense Ratio
    1.090%
  • Expense Ratio 1.090%
  • Distribution Fee Level Low
  • Share Class Type Level Load
  • Category Short-Term Bond
  • Credit Quality / Interest Rate Sensitivity
  • Min. Initial Investment 1,000
  • Status Open
  • TTM Yield 2.28%
  • Effective Duration 1.96 years

USD | NAV as of Feb 28, 2024 | 1-Day Return as of Feb 28, 2024, 11:56 PM GMT+0

unlocked

Morningstar’s Analysis OSTCX

Medalist rating as of .

JPMorgan Short Duration Bond C boasts strong People and Process Pillar ratings, but other weaknesses hold this strategy's Morningstar Medalist Rating at Neutral.

Our research team assigns Neutral ratings to strategies they’re not confident will outperform a relevant index, or most peers, over a market cycle on a risk-adjusted basis.

JPMorgan Short Duration Bond C boasts strong People and Process Pillar ratings, but other weaknesses hold this strategy's Morningstar Medalist Rating at Neutral.

null Morningstar Manager Research

Morningstar Manager Research

Summary

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

The strategy's managers invest alongside shareholders, which helps it earn an Above Average People Pillar rating. The strategy's effective investment approach earns an Above Average Process Pillar rating. The strategy's parent organization earns the firm an Above Average Parent Pillar rating, and this rating is inherited from vehicles belonging to the same branding entity and is indirectly assigned by an analyst.

Rated on Published on

Morningstar's style-agnostic investment process evaluation looks for strategies that should be able to outperform their Morningstar Category index on a risk-adjusted basis over time.

null Morningstar Manager Research

Morningstar Manager Research

Process

Above Average

JPMorgan Short Duration Bond Fund earns an Above Average Process Pillar rating.

The predominant 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. Impressive risk-adjusted performance also contributes to the process. This can be seen in the fund's five-year alpha calculated relative to the category index, which suggests that the managers have shown skill in their allocation of risk. 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 Short-Term Bond Morningstar Category, this fund has been consistently sensitive to interest-rate changes over the past few years. Opening the analysis to additional factors, the portfolio has displayed biases over time, whether towards or away from certain fixed-income instruments. Relative to the category average, the managers have been underweight corporate debt in recent years. In the latest month, the strategy has also relatively underweighted corporate bonds compared with Morningstar Category peers. Additionally, there's been a bias away from debt with longer than 30-year maturities over the past few years. Similarly, in recent months, the strategy also had less exposure to debt with longer than 30-year maturities than peers. Finally, during the past few years, the fund leaned meaningfully away from BBB rated bonds. In recent months, the strategy also had less exposure to BBB rated bonds compared to its peers.

This strategy has a modest 2.3% 12-month yield, lower than its average peers' 3.6%. It also 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's average surveyed credit quality is on par with peers, with both the fund and the average being rated A.

Rated on Published on

JPMorgan Short Duration Bond Fund earns an Above Average People Pillar rating.

null Morningstar Manager Research

Morningstar Manager Research

People

Above Average

The leading driver of the rating is its parent firm's five-year success ratio of 58%. The measure indicates the percentage of a firm's funds that survived and beat their respective category's median return for the period. The stability of talent across its parent firm also contributes to the rating. The firm's asset-weighted manager tenure of 18 years demonstrates its ability to retain portfolio managers. Lastly, the rating is limited by the managers' failure to consistently outperform peers at the funds they run, as measured by their combined three-year manager excess returns.

Toby Maczka, the longest-tenured manager, has six years of listed portfolio management experience. The strategies they currently manage have an average Morningstar Rating of 3.0 stars, demonstrating average risk-adjusted performance compared with category peers. Despite having a small team, the two listed managers boast 21 years of listed portfolio management experience. At least one member of the team has invested $1 million or more of their own capital in the fund, which helps align their interests with the strategy's investors.

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

Performance-wise, this strategy’s C share class, with returns reported in US Dollar, has demonstrated it is weak over a full market cycle, with inferior returns compared with peers and when adjusted for risk.

null Morningstar Manager Research

Morningstar Manager Research

Performance

The share class failed to beat the category index, Bloomberg Barclays U.S. Aggregate Government/ Credit 1-3 Year Index, with a lower Sharpe ratio, a measure of risk-adjusted returns, over the trailing 10-year period. However, this strategy hewed close to the benchmark's standard deviation. Finally, the share class proved itself ineffective as it was unable to generate alpha, over the same period, against the category group index: a benchmark that encapsulates the performance of the broader asset class.

The fund continues to have a disappointing track record viewed through the lens of long-term absolute returns. On a 10-year basis, this share class underperformed the category index by an annualized 59 basis points. The strategy also trailed the category average by an annualized 75 basis points over the same 10-year period.

Published on

It is important to pay attention to fees, as lower-cost investments maximize investors' returns.

null Morningstar Manager Research

Morningstar Manager Research

Price

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

Published on

Portfolio Holdings OSTCX

  • Current Portfolio Date
  • Equity Holdings
  • Bond Holdings
  • Other Holdings
  • % Assets in Top 10 Holdings 14.3
Top 10 Holdings
% Portfolio Weight
Market Value USD
Sector

United States Treasury Bills

5.03 329.7 Mil
Government

JPMorgan US Government MMkt Instl

3.34 218.8 Mil
Cash and Equivalents

United States Treasury Notes 4.5%

3.04 199.2 Mil
Government

United States Treasury Notes 2.25%

2.50 163.8 Mil
Government

United States Treasury Notes 4.625%

2.35 153.8 Mil
Government

United States Treasury Notes 3.75%

2.27 148.9 Mil
Government

United States Treasury Notes 4.625%

1.86 122.0 Mil
Government

United States Treasury Notes 3.625%

1.53 100.2 Mil
Government

United States Treasury Notes 4.375%

0.73 47.9 Mil
Government

Morgan Stanley

0.71 46.8 Mil
Corporate