JPMorgan Diversified Return Global Equity Launch

In a press release last week issued by J.P. Morgan Asset Management announced that its first ETF, JPMorgan Diversified Return Global Equity (JPGE) has now officially launched for trading. This fund represents the next generation of strategic beta ETFs that want to provide global equity returns from four different return factors in order to reduce volatility by diversifying risks across regions and sectors.

J.P. Morgan Asset Management is a global leader in asset management with assets under management of $1.6 trillion. Clients include institutions, retail investors, and high net worth individuals in every global market. The company offers global investing in equities, fixed income, real estate, hedge funds, private equity and lastly liquidity.

This fund is designed to give the market participation with lower volatility. This stems from the fact that traditional market-cap weighted in addition to single factor indices exposes investors to risk concentrations and a bias towards overvalued securities. That being said, the goal of this fund is to reallocate risk by weighting stocks according to four factors. Those factors are value, size, momentum, and lastly low volatility. According to recent research, these factors combined may contribute to better risk-adjusted returns.

This fund is managed by an experienced team at JPMorgan. One of those members includes Beltran Lastra, an 18-year veteran as the lead portfolio manager. Lastra and team go on to state that, “We believe that J.P. Morgan has unique investment insights and global capabilities that will be attractive ETF investors, and this product is an important first step in delivering those capabilities.”