Focus on quality amid volatility
Global market swings can seem unsettling, but they are part and parcel of the investment cycle. Staying invested and diversified is crucial to navigating these challenges.
Market pullbacks can also present opportunities to deploy capital. However, amid heightened volatility and elevated economic uncertainty, staying selective and focusing on high-quality assets will be important to ensure portfolios remain resilient.
Rigorous bottom-up research and active management will play critical roles in going beyond the headlines to uncover enduring opportunities that can potentially weather any market terrain and ride out any cycle.
In any terrain
American dispersion
Over the years, the US equity market has gravitated towards areas of innovation. Unsurprisingly, sectors like information technology have grown to dominate the S&P 5001, with optimism surrounding generative artificial intelligence (AI) propelling stocks to new highs.
While the S&P 500 may appear expensive relative to its long-run average, headline price-to-earnings data mask a wide divergence between the valuations of the top 10 biggest names and the rest of the index (see chart)2. Furthermore, broadening profitability, resilient US consumers, and the prospect of lower interest rates paint a relatively positive picture for US stocks, with opportunities to be found in both growth and value sectors. Market pullbacks may also present opportunities to tap into high-quality companies at relatively attractive valuations.
Nevertheless, market sentiment may face periodic challenges due to changing economic conditions and elevated geopolitical risks. Amid a more volatile market terrain, active management will be crucial to help uncover high-quality opportunities that can thrive in different market cycles.
Valuations diverge widely between the top 10 stocks and the remaining constituents of the S&P 500 index.
Price-to-Earnings (P/E) Ratios
Global diversification
While the US market remains an important source of alpha potential, it could still be worthwhile to seek opportunities elsewhere. After all, not all structural themes can be accessed through one geographical market alone. For example, while a handful of AI-related mega-cap US tech names have driven returns and dominated the headlines, there are plenty of lesser-known companies in Taiwan, South Korea, and Europe that play niche, yet significant roles in key nodes of the tech supply chain and are beneficiaries of this structural trend3.
Even in sectors like luxury, semiconductors, pharmaceuticals, and industrials, high-quality opportunities can be found outside of the US, exhibiting relatively attractive growth profiles and fair valuations.
By investing with a global lens, active investors can cast a wider net and uncover potentially high-quality opportunities wherever they may be, whether for income generation or capital appreciation. This approach can help diversify return streams and prevent portfolios from being overly dependent on a handful of companies to drive long-term performance.
The investment landscape extends beyond US equities.
Seek quality opportunities through active management
Led by our award-winning, well-resourced, and long-tenured equities team, our firm has a long and proud history of investing in and navigating fast-changing global equity markets. Our investment expertise is founded on deep resources, a commitment to global research, and active collaboration across regions and sectors to help us uncover high-conviction opportunities.
Our active solutions
Underpinned by a rigorous, time-tested, bottom-up stock selection process, our actively managed equity funds have a history of navigating different market cycles while generating robust performance.
Investment ideas on core equities
Provided for information only based on market conditions as of date of publication, not to be construed as investment recommendation or advice. The manager seeks to achieve the stated objectives. There can be no guarantee the objectives will be met.
Diversification does not guarantee investment return and does not eliminate the risk of loss.
JPMorgan America Equity Fund is the marketing name of the JPMorgan Funds – America Equity Fund.
JPMorgan Global Select Equity Fund is the marketing name of the JPMorgan Investment Funds – Global Select Equity Fund.
JPMorgan Global Dividend Fund is the marketing name of the JPMorgan Investment Funds – Global Dividend Fund.
- Source: Bloomberg, J.P. Morgan Asset Management. Information technology accounted for 28.9% of the S&P 500 Index as of end-2023. Data as of 31 December 2023. Past performance is not a reliable indicator of current and future results.
- Source: FactSet, MSCI, Standard & Poor’s, J.P. Morgan Asset Management. Data as of 30.06.2024. Price-to-earnings (P/E) ratios are in local currency terms. Indices do not include fees or operating expenses and are not available for actual investment. Past performance is not a reliable indicator of current and future results.
- Source: J.P. Morgan Asset Management. “Searching the globe for equity opportunities.” Published 12.06.2024.
- Asian Private Banker Asset Management Awards for Excellence are issued by Asian Private Banker in the year specified, reflecting product performance, business performance, service competency, branding and marketing as at the previous calendar year end.
- The Citywire Asia Fund Manager Award/Citywire Asia/Citywire Asia Asset Management Awards are issued by Citywire Asia in the year specified, reflecting performance of the past one year as at 30.09.2023 for 2023 award.
- Source: J.P. Morgan Asset Management. Data as of 31.03.2024. Includes portfolio managers, research analysts, traders and investment specialists with VP title and above. There can be no assurance that professionals currently employed by J.P. Morgan Asset Management will continue to be employed by J.P. Morgan Asset Management or that past performance or success of such professionals serve as an indicator of the professionals’ future performance or success.
- Source: J.P. Morgan Asset Management. Data as of 31.03.2024.
- Please refer to the fund’s offering documents for further details on its objectives. The manager seeks to achieve its stated objectives and there is no guarantee they will be met. Actual account allocations and characteristics may differ. Holdings, duration, allocations or exposure in actively portfolio managed portfolios are subject to change from time to time. Investments involve risks. Not all investments, strategies or ideas are suitable for all investors. Investors should make their own evaluation or seek independent advice and review offering documents carefully prior to making any investment.
- Source: J.P. Morgan Asset Management/RIMES (NAV to NAV and charges applied in denominated currency with income reinvested, taking into account all charges which would have been payable upon such reinvestment). Data as of 30.06.2024. Past performance is not indicative of current or future result. Unless stated otherwise, all information refers to A (dist) – USD Class as at 30.06.2024. Benchmark: S&P 500 Index (Total Return Net of 30% withholding tax). Inception/Launch date: 16.11.1988.
- Source: J.P. Morgan Asset Management. Data as of 31.03.2024. 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.
By using this information, you confirm that you are a Singapore resident and you accept the Terms of Use as set out in https://www.jpmorgan.com/sg/am/per/.
This website is meant for informational purposes only and is intended solely for the person to whom it is delivered. Except as indicated on this website or otherwise with express consent from JPMorgan Asset Management (Singapore) Limited, it may not be reproduced or distributed, in whole or in part, to any third parties and in any jurisdiction.
This advertisement or publication has not been reviewed by the Monetary Authority of Singapore. It does not constitute investment advice and it should not be treated as an offer to sell or a solicitation of an offer to buy any fund, security, investment product or service. The information contained herein does not constitute J.P. Morgan research and should not be treated as such.
Investments involve risks. Investments in funds are not deposits and are not considered comparable to deposits. Past performance is not a guarantee or necessarily indicative of future results and investors may not get back the full or any part of the amount invested. Dividend distributions if any are not guaranteed and are made at the manager’s discretion. Fund’s net asset value may likely have high volatility due to its investment policies or portfolio management techniques. Funds which are invested in emerging markets, smaller companies and financial derivative instruments may also involve higher risks and are usually more sensitive to price movements. Any applicable currency hedging process may not give a precise hedge and there is no guarantee that any hedging will be successful. Investors in a currency hedged fund or share class may have exposure to currencies other than the currency of their fund or share class.
Not all investment ideas referenced are suitable for all investors. Investors should make their own evaluation or seek independent advice prior to making any investment. Opinions, estimates, forecasts, and statements of financial market trends are based on current market conditions and are subject to change without notice. The information provided herein should not be assumed to be accurate or complete and you should conduct your own verification. References to specific securities, asset classes and financial markets and any forecast contained herein are for illustrative purposes only and are not to be relied upon as advice or interpreted as a recommendation. J.P. Morgan accepts no legal responsibility or liability for any matter or opinion expressed in this material.
The funds mentioned in this document have been approved as recognised schemes under the Securities and Futures Act, Chapter 289 of Singapore. Any offer or sale, or invitation for subscription or purchase of the Funds must be accompanied with the relevant valid Singapore Offering Documents (which incorporates and is not valid without the relevant Luxembourg prospectus). Please refer to the Singapore Offering Documents (including the risk factors set out therein) and the relevant Product Highlights Sheet for details before any investment at https://www.jpmorgan.com/sg/am/per/
The funds seek to achieve the investment objectives stated in the offering documents, there can be no guarantee the objective will be met. Investments in the Fund are not deposits and are not considered as being comparable to deposits. Fund’s net asset value may likely have high volatility due to its investment policies, exposure to emerging markets, financial derivatives instruments or portfolio management techniques. The value of the units in the scheme and the income accruing to the units, if any, may fall or rise. Past performance is not indicative of current or future results and investors may not get back the full or any part of the amount invested.
To the extent permitted by applicable law, we may record telephone calls and monitor electronic communications to comply with our legal and regulatory obligations and internal policies. Personal data will be collected, stored and processed by J.P. Morgan Asset Management in accordance with our privacy policies at https://am.jpmorgan.com/global/privacy.
This material is issued by JPMorgan Asset Management (Singapore) Limited (Co. Reg. No. 197601586K). All rights reserved.