A multi-income journey into the emerging high-yield potential
Income investors like us have stayed the course as we ride through the four seasons. Where do we see income opportunities?
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The global public health crisis has disrupted economic activity in China but the country’s various industries are gradually recovering with the support of fiscal and monetary policies. As China strives to overcome this challenging situation, renewed geopolitical risk has emerged as another hurdle ahead. With these two economic hurdles, which Chinese sectors could leverage on the growth opportunities accelerated by structural transformation? And which could likely ace the competitive landscape as the strong that could become stronger?
1. New growth opportunities
Healthcare1
Technology1
2. Seeking import substitution
Healthcare1
Technology1
How are JPMorgan China A-Share Opportunities Fund and
JPMorgan China Pioneer A-Share Fund capturing these opportunities?
1. A Chinese equity portfolio with long-term growth potential
The A-Share market’s diverse sector composition allows the Funds to capture long-term growth opportunities which can be found in sectors with diverse “New China” opportunities. Supported by our Greater China Team’s comprehensive research and local knowledge, our fund managers focus on identifying quality Chinese companies with long-term growth potential.
Compared with their respective benchmarks, our Funds have an overweight view on information technology and healthcare sectors, as of end-May 2020. Both sectors are also the top contributors to the Funds’ year-to-date performance2.
2. Bottom-up stock selection supported by macro insights
Leveraging our on-the-ground research which focuses on company fundamentals, our fund managers integrate bottom-up stock selection with top-down macro and policy views to identify high conviction stock ideas. The Funds adopt an all-cap, high conviction, growth-oriented approach, focusing on a concentrated pool of investment opportunities.
Greater China experts3
Coverage4
Fund rating5
3. Access to A-Share investing with RMB/USD as base currencies
The JPMorgan China A-Share Opportunities Fund is denominated in renminbi (RMB) with two other share classes – one in Hong Kong dollar (HKD) and one in US dollar (USD) while the JPMorgan China Pioneer A-Share Fund is denominated in USD, offering different choices to investors with different needs.
Conclusion
As China recovers and continues to transform its economy, this has accelerated the development of structural growth trends such as domestic technology and healthcare innovation1. A focus on bottom-up fundamental research helps identify quality Chinese corporates which could capture long-term investment opportunities.
This content represents our investment team’s current view and overall strategy provided for information only based on current market conditions not taking into consideration any specific investor’s investment objective and risk appetite. Not to be construed as investment recommendation or advice.
1. For illustrative purposes only based on current market conditions, subject to change from time to time. Not all investments are suitable for all investors. Exact allocation of portfolio depends on each individual’s circumstance and market conditions.
2. Holdings, exposures and allocations for actively managed portfolios are subject to change from time to time. These represents Emerging Markets & Asia Pacific Equities team’s views under current market conditions, subject to change from time to time. Provided for information only, not to be construed as investment advice. Diversification does not guarantee investment return and does not eliminate the risk of loss.
3. Source: J.P. Morgan Asset Management. Data as of 31.05.2020. 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.
4. Source: J.P. Morgan Asset Management. Data as of 31.12.2019.
5. Source of Morningstar Analyst Rating: © 2020 Morningstar, Inc. All Rights Reserved. Data as of 31.05.2020.
Investment involves risk. Not all investments are suitable for all investors. Past performance is not a reliable indicator of current and future results. Please refer to the offering document(s) for details, including the risk factors. Investors should consult professional advice before investing. Investments are not similar to or comparable with fixed deposits. The opinions and views expressed here are as of the date of this publication, which are subject to change and are not to be taken as or construed as investment advice. Estimates, assumptions and projections are provided for information only and may or may not come to pass. This document has not been reviewed by the SFC. Issued by JPMorgan Funds (Asia) Limited.