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JPMORGAN EQUITY INCOME FUND

An income approach to equities pays dividends.

The Equity Income Fund focuses on high-quality companies with healthy and sustainable dividend yields, providing a conservative way to participate in U.S. equity markets.
 

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HIGHLIGHTS

EXCESS GROWTH OF $100,000 DURING MANAGER’S TENURE

Source: J.P. Morgan Asset Management, Morningstar; as of 3/31/16. Morningstar Large Value Category. Ending values since fund inception date of 7/2/87: Equity Income $1,154,495, Russell 1000 Value Index $1,392,844, Morningstar category average $967.472. Returns shown are for the Select Share class. Other share classes may have higher expenses, which would result in lower returns. Returns with dividend and capital gains reinvested. There is no direct correlation between a hypothetical investment and the anticipated performance of the Fund. Clare Hart became Portfolio Manager on 12/1/05. There can be no assurance that the current portfolio manager will continue to manage the fund or that past performance is an indicator of future performance. The $0 value for benchmark growth is the baseline for the over and under comparison.

Key points

  • Invests in high-quality U.S. companies with attractive valuations and healthy dividends.
  • A conservative approach that has delivered low volatility vs. peers and outperformed the index in down markets.
  • Outperformed both the benchmark and its peers over the three-, five- and 10-year periods.1

1 Source: Morningstar, Large Value Category. Select Shares as of 3/31/16. Top-decile performance vs. peers over the 5-and 10 year periods. Ranked as follows: 1-year (299/1390), 3-year, (153/1207) five-years,(63/1051) and 10-years (28/764).


Seeking out the best dividend payers

Since 1926, dividends have made up 40% of equity total returns, making dividend-paying companies a relatively stable way of accessing the growth potential of the stock market.

The Fund’s portfolio managers target high-quality U.S. companies with attractive valuations and healthy dividends. One specific feature looked for is a higher dividend yield combined with a lower payout ratio. This combination suggests that a company will likely maintain the ability to pay compelling dividends, with the potential for future growth and appreciation.

Chart Source: J.P. Morgan Asset Management Quantitative Equity Research. Data as of 3/31/16. Each yield/payout ratio illustrates compounded total returns: price appreciation and dividend payout. The benchmark is the equal-weighted Russell 1000 Value Index. The chart is designed to illustrate that companies with a high yield and low payout ratio have outperformed, historically. Chart figures do not represent investable vehicles as each category is rebalanced monthly.

PERFORMANCE BY DIVIDEND AND PAYOUT RATIO (in thousands)

Shown for illustrative purposes. Past performance is not indicative of future results.

Performance

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Fees and Investment Minimums

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Portfolio

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Management

Fund Managers

For more information about this fund, please see the commentary posted below. 
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Disclaimer

Please refer to the prospectus for additional information about cut-off times.

Total return assumes reinvestment of income.

The Russell 1000 Value Index is an unmanaged index, which measures the performance of those Russell 1000 companies with lower price-to-book ratios and lower forecasted growth values. The performance of the index does not reflect the deduction of expenses associated with a fund, such as investment management fees. By contrast, the performance of the Fund reflects the deduction of the fund expenses, including sales charges if applicable. Investors can not invest directly in an index.

The performance of the Lipper Equity Income Funds Index includes expenses associated with a mutual fund, such as investment management fees. These expenses are not identical to the expenses charged by the Fund.

Total return assumes reinvestment of dividends and capital gains distributions and reflects the deduction of any sales charges, where applicable. Performance may reflect the waiver of a portion of the Fund's advisory or administrative fees and/or reimbursement of certain expenses for certain periods since the inception date. If fees had not been waived and/or certain expenses were not reimbursed, performance would have been less favorable.

©2016, American Bankers Association, CUSIP Database provided by the Standard & Poor's CUSIP Service Bureau, a division of The McGraw-Hill Companies, Inc. All rights reserved.
The currency for the calculation corresponds to the currency of the country for which the awards are calculated and relies on monthly data. Classification averages are calculated with all eligible share classes for each eligible classification. The calculation periods extend over 36, 60, and 120 months. For a detailed explanation please review the Lipper Leaders methodology document on www.lipperweb.com.
Although Lipper makes reasonable efforts to ensure the accuracy and reliability of the data contained herein, the accuracy is not guaranteed by Lipper. Users acknowledge that they have not relied upon any warranty, condition, guarantee, or representation made by Lipper. Any use of the data for analyzing, managing, or trading financial instruments is at the user's own risk. This is not an offer to buy or sell securities.

The prices of equity securities are sensitive to a wide range of factors, from economic to company-specific news, and can fluctuate rapidly and unpredictably, causing an investment to decrease in value.

Investments in derivatives may be riskier than other types of investments. They may be more sensitive to changes in economic or market conditions than other types of investments. Many derivatives create leverage, which could lead to greater volatility and losses that significantly exceed the original investment.

There is no guarantee that companies that can issue dividends will declare, continue to pay or increase dividends.
Total return assumes reinvestment of income.

The top 10 holdings listed reflect only the Fund's long-term investments. Short-term investments are excluded. Holdings are subject to change. The holdings listed should not be considered recommendations to purchase or sell a particular security. Each individual security is calculated as a percentage of the aggregate market value of the securities held in the Fund and does not include the use of derivative positions, where applicable.

P/E ratio: the number by which earnings per share is multiplied to estimate a stock's value.

P/B ratio: the relationship between a stock's price and the book value of that stock.

Beta measures a fund's volatility in comparison to the market as a whole. A beta of 1.00 indicates a fund has been exactly as volatile as the market.

Sharpe ratio measures the fund's excess return compared to a risk-free investment. The higher the Sharpe ratio, the better the returns relative to the risk taken.

Tracking Error: The active risk of the portfolio, which determines the annualized standard deviation of the excess returns between the portfolio and the benchmark.

Alpha: The relationship between the performance of the Fund and its beta over a three-year period of time.

Standard deviation/Volatility: A statistical measure of the degree to which the Fund's returns have varied from its historical average. The higher the standard deviation, the wider the range of returns from its average and the greater the historical volatility. The standard deviation is calculated over a 36-month period based on Fund's monthly returns. The standard deviation shown is based on the Fund's Class A Shares or the oldest share class, where Class A Shares are not available.

R2: The percentage of a Fund's movements that result from movements in the index ranging from 0 to 100. A Fund with an R2 of 100 means that 100 percent of the Fund's movement can completely be explained by movements in the Fund's external index benchmark.

EPS: Total earnings divided by the number of shares outstanding.

Risk measures are calculated based upon the Funds' broad-based index as stated in the prospectus.