Swing pricing
As part of its commitment to protect the best interest of its clients, J.P. Morgan Asset Management has implemented swing pricing on the JPMorgan Funds (JPMF) and JPMorgan Investment Funds (JPMIF) umbrellas. Swing pricing aims to protect existing investors from the performance dilution effects they may suffer as a result of transactions by other investors in the fund. It is implemented in a clear and systematic fashion.
In certain situations, the Management Company may consider it to be in the interests of shareholders in a particular sub-fund to encourage the growth of assets under management. In order to attract inflows, the Management Company may suspend the swing pricing that would normally be applied under the terms of the prospectus in relation to subscriptions and allow investors to subscribe at the un-swung NAV price, until such time that the sub-fund reaches a certain size or for a specific period of time. Existing investors will remain protected as the dilution effect to the sub-fund arising from large inflows will be compensated to the sub-fund by the Management Company. The Management Company is currently not suspending the swing pricing on subscriptions for any sub-funds.
In light of the prevailing market conditions and notwithstanding anything to the contrary in the Swing Pricing Brochure, the swing threshold has been set at 5% for JPMF – Managed Reserves Fund and at 0.5% for all remaining sub-funds in JPMF and JPMIF (except those for which swing pricing is not applied).
In addition to the above, and in line with the updated CSSF FAQ on Swing Pricing Mechanism, the Board of Directors of JPMF and JPMIF has decided, on 25 March 2020, to introduce flexibility to increase the maximum swing factor for the relevant sub-funds in JPMF and JPMIF from 2% (as currently set out in the prospectuses) up to a maximum of 5%, if this is deemed necessary in the prevailing market conditions and is in the best interests of shareholders.
For further information about the above changes, please contact the Management Company.