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JPMorgan Tax Aware Real Return I TXRIX

Medalist Rating as of | See JPMorgan Investment Hub
  • NAV / 1-Day Return 9.46  /  −0.11 %
  • Total Assets 520.9 Mil
  • Adj. Expense Ratio
    0.450%
  • Expense Ratio 0.450%
  • Distribution Fee Level Below Average
  • Share Class Type Institutional
  • Category Muni National Interm
  • Credit Quality / Interest Rate Sensitivity Medium/Moderate
  • Min. Initial Investment 1.0 Mil
  • Status Open
  • TTM Yield 3.23%
  • Effective Duration 4.55 years

USD | NAV as of Apr 17, 2024 | 1-Day Return as of Apr 17, 2024, 10:22 PM GMT+0

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Morningstar’s Analysis TXRIX

Medalist rating as of .

JPMorgan Tax Aware Real Return I 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 Tax Aware Real Return I boasts strong People and Process Pillar ratings, but other weaknesses hold this strategy's Morningstar Medalist Rating at Neutral.

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Morningstar Manager Research

Summary

The portfolio maintains a cost advantage over competitors, priced within the second-cheapest fee quintile among peers.

The management team's considerable industry experience drives an Above Average People Pillar rating for the strategy. 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 BBB rated bonds and has an overweight in debt with 10- to 15-year maturities compared with category peers. 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 evaluation of this fund's process seeks to understand whether the strategy has a performance objective and sensible, repeatable execution.

null Morningstar Manager Research

Morningstar Manager Research

Process

Above Average

JPMorgan Tax Aware Real Return Fund earns an Above Average Process Pillar rating.

The leading factor in the rating is the fund's impressive 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 beat their respective category's median Morningstar Risk-Adjusted Return for the period. Their relatively high success ratio suggests that the firm does well for investors and that this fund may benefit from that. Lastly, the process is limited by being an actively managed strategy. Historical data, such as 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 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 BBB rated bonds in recent years. In the latest month, the strategy has also relatively underweighted BBB rated bonds compared with Morningstar Category peers. Additionally, there's been a bias towards debt with 10- to 15-year maturities over the past few years. Compared with category peers, the strategy had more exposure to debt with 10- to 15-year maturities in the most recent month. Finally, during the past few years, the fund leaned meaningfully towards cash. In this month, the strategy also leaned more towards cash compared with its peers.

This strategy has a 3.2% 12-month yield, higher than its average peer's 2.8%. In addition, it has a 3.0% 30-day SEC yield (a measure similar to yield-to-maturity). While a higher yield may deliver more income, it also tends to indicate higher credit risk. But that isn't always the case. Over the past 12 months, the average yield of the fund has been higher 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 Tax Aware Real Return Fund earns an Above Average People Pillar rating.

null Morningstar Manager Research

Morningstar Manager Research

People

Above Average

The largest contributor to the rating is its parent firm's five-year success ratio of 57%. The measure indicates the percentage of a firm's funds that survived and beat their respective category's median return for the period. The combined average five-year excess return of each manager also bolsters the rating. It implies that the funds they manage have exceeded the average manager. Lastly, the rating is limited by the parent firm's five-year retention rate of 81%, which suggests it could do more to retain its portfolio managers.

The team is backed by David P. Rooney, the longest-tenured manager on the strategy, who brings over 25 years of listed portfolio management experience. The average Morningstar Rating of the strategies they currently manage is 3.2 stars, demonstrating average risk-adjusted performance. David P. Rooney has an experienced backdrop of support. The three listed managers boast 21 years of average listed portfolio management experience. None of the portfolio managers here invest in this fund. This hurts the rating because manager investment would 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

This strategy's Institutional share class' long-term performance is mixed depending on the yardstick used.

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Morningstar Manager Research

Performance

It has provided better returns compared with peers, but mixed returns compared with the category benchmark. Over a 10-year period, this share class outperformed the category’s average return by 95 basis points annualized. However, it had an inconsistent track record compared with its category benchmark, Bloomberg Barclays Municipal 1-15 Year Bond Index, where it outperformed the index by 58 basis points over an eight-year period and fell short of the category benchmark by 38 basis points over the 10-year period.

When adjusting for risk, the fund is not as favorable. The share class had a lower Sharpe ratio, a measure of risk-adjusted returns, than the index 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 10-year period, against the category group index: a benchmark that encapsulates the performance of the broader asset class.

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Returns vary from period to period, but expenses are always deducted.

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Morningstar Manager Research

Price

It is good practice to weigh them heavily in any investment evaluation. This share class imposes a fee that ranks in its Morningstar Category's second-cheapest quintile. Despite this fee, the fund’s People, Process, and Parent Pillars suggest this share class is probably best avoided, as it does not offer investors a good chance at producing positive alpha versus its peer benchmark, garnering a Morningstar Medalist Rating of Neutral.

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Portfolio Holdings TXRIX

  • Current Portfolio Date
  • Equity Holdings
  • Bond Holdings
  • Other Holdings
  • % Assets in Top 10 Holdings 15.7
Top 10 Holdings
% Portfolio Weight
Market Value USD
Sector

JPMorgan Instl Tx Fr Mny Mkt Agcy

6.23 31.4 Mil
Cash and Equivalents

Cash

2.73 13.8 Mil
Cash and Equivalents

CALIFORNIA CMNTY CHOICE FING AUTH CLEAN ENERGY PROJ REV 4%

2.44 12.3 Mil
municipal

NEW YORK N Y CITY TRANSITIONAL FIN AUTH REV 5%

2.18 11.0 Mil
municipal

OREGON ST FACS AUTH REV 3.45%

1.99 10.0 Mil
municipal

LOUISIANA ST GAS & FUELS TAX REV 4.5%

1.61 8.1 Mil
municipal

TENNERGY CORP TENN GAS REV 4%

1.45 7.3 Mil
municipal

HOUSTON TEX WTR & SWR SYS REV 5.75%

1.38 7.0 Mil
municipal

ILLINOIS ST 5%

1.35 6.8 Mil
municipal

VIRGINIA ST PUB SCH AUTH SPL OBLIG PRINCE WILLIAM CNTY 4.25%

1.17 5.9 Mil
municipal