Recovering economy, recovering Chinese property bond demand
As China’s property market recovers, capture income potential of Chinese property bonds with a diversified Asian bond strategy.
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Why JPMorgan Asian Total Return Bond Fund Now? | Investment Insights: Asian Bond | Fund Details
Which is why the JPMorgan Asian Total Return Bond Fund navigates through the evolving fixed income markets, tapping the broad spectrum of Asian bond sectors for compelling income opportunities.
CAPTURING THE VAST POTENTIAL ACROSS ASIAN BONDS
Supportive backdrop from accommodative policies
Over six months into 2020, geopolitical uncertainty and the public health crisis continue to dominate markets. Central banks and governments have responded with massive monetary and fiscal stimulus to support economies and help mitigate risks. Inflation is expected to remain benign in Asia, potentially giving policymakers more room for quantitative easing policies, which could be a boon for debt markets.
Source: Various central banks, J.P. Morgan Asset Management, as of end-June 2020. China’s policy rate is calculated based on the medium-term lending facility rates. YTD: year-to-date.
Better positioned to capture income potential
Investors’ search for yield has become tougher in the era of ultra-low, or zero interest rates. When compared with other regions around the globe, Asian bonds generally offer more attractive income potential. Meanwhile, investing in higher-yielding local currency debt may help enhance potential returns.
Source: Bloomberg, as of end-June 2020. Yield is not guaranteed. Positive yield does not imply positive return.
Risk diversification potential
Various Asian bonds exhibit lower, or negative correlation to US Treasuries while offering compelling returns. Similarly, USD Asian IG bonds and local currency Asian bonds also show lower correlation to equities. Taking a diversified approach across Asian bond sectors could offer diversification^ benefits to the overall portfolio.
^ Diversification does not guarantee investment return and does not eliminate the risk of loss.
IG: investment grade. HY: high yield. Source: Bloomberg, J.P. Morgan, as of end-June 2020, calculated using monthly returns in USD. Indices used: J.P. Morgan Asia Credit Investment Grade Index (USD Asian IG bonds), J.P. Morgan Asia Credit High Yield Index (USD Asian HY bonds), J.P. Morgan Asia Diversified Index (Local currency Asian bonds), ICE BofA US Treasury Index (10-year US Treasury), MSCI World Index (Developed-market equities), S&P 500 Index (US equities). Past performance is not indicative of future performance. Indices do not include any fees or operating expenses and are not available for actual investment.
J.P. MORGAN ASSET MANAGEMENT'S ASIAN FIXED INCOME TEAM
Source: J.P. Morgan Asset Management, as of end-June 2020. There can be no assurance that the professionals currently employed by J.P. Morgan Asset Management (JPMAM) will continue to be employed by JPMAM or that the past performance or success of any such professional serves as an indicator of such professional's future performance or success.
WHY INVEST IN THE JPMORGAN ASIAN TOTAL RETURN BOND FUND?
A flexible Asian bond strategy
A robust Asian bond strategy would require the flexibility to exploit investment ideas across a wide range of opportunities available in the region. Without benchmark constraints, the Fund invests flexibly in fixed income sectors such as USD Asian credit, local currency bonds and convertibles, striving for competitive total returns.
Actively managed portfolio
The Fund taps into a diverse set of sectors available in the region, seeking to optimise the unique benefits of each sector. The investment team actively manages currency positions and duration to navigate changing market conditions. The tactical foreign exchange hedging also allows for flexible adjustment in our Asian currency exposure, covering RMB and other higher-yielding currencies such as IDR, with a view to managing risks while seizing opportunities.
In view of the global risks and uncertainties, the fund managers focus on financially sound and higher-quality issuers in order to raise the overall credit quality for the portfolio.
^ Source: J.P. Morgan Asset Management, Moody’s, S&P, Fitch, China local rating agency, as of end-June 2020. To calculate portfolio credit quality, China local rating agency scale is translated into international rating agency scale. The credit rating is based on the highest of different rating agencies. Average rating is the weighted average of the credit ratings of bond holdings (including non-rated bonds) and net liquidity.
# Source: J.P. Morgan Asset Management, Morningstar, Inc, Asia Bond Category of HK SFC authorised funds (as of end-June 2020, NAV to NAV in USD with income reinvested). SFC authorisation is not a recommendation or endorsement of a scheme nor does it guarantee the commercial merits of a scheme or its performance. It does not mean the scheme is suitable for all investors nor is it an endorsement of its suitability for any particular investor or class of investors. Volatility based on monthly data of the USD (mth) Class.
Attractive income opportunities
The Fund offers monthly distributing share classes*, providing attractive income opportunities. In addition, the Fund is available in USD and HKD Classes, alongside AUD Hedged, CAD Hedged, NZD Hedged, RMB Hedged and GBP Hedged Classes, to help meet investors’ need for different currencies.
(* Aim at monthly distribution. Dividend rate is not guaranteed. Distributions may be paid from capital. Refer to important information 3)
Historical distributions
| Annualised yield* ℹ (Ex-dividend date 30.06.2020) | |
| USD (mth) Class | 5.11% |
| HKD (mth) Class | 5.11% |
| AUD Hedged (mth) Class | 5.06% |
| CAD Hedged (mth) Class | 5.07% |
| NZD Hedged (mth) Class | 5.31% |
| RMB Hedged (mth) Class | 7.32% |
| GBP Hedged (mth) Class | 4.92% |
ℹ Positive distribution yield does not imply positive return. Annualised yield = [(1+distribution per unit/ex-dividend NAV)^12]-1. The annualised dividend yield is calculated based on the monthly dividend distribution with dividend reinvested, and may be higher or lower than the actual annual dividend yield.
