JPMorgan Global Allocation Fund - R2 - J.P. Morgan Asset Management
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JPMORGAN GLOBAL ALLOCATION FUND

There’s growth to be found when you know where to look.

With access to the entirety of J.P. Morgan’s global investment platform, the Global Allocation Fund searches worldwide to maximize total return, while also managing risk.
 

Fund Story   Morningstar article: JPMorgan Global Allocation Fund   Variable Insurance Trust Portfolio   

Key Points

Expertise
  • A single-point access to the best of J.P. Morgan’s broad global investment platform.
Portfolio
  • With broad allocation ranges, this flexible, capital appreciation-oriented solution represents J.P. Morgan’s highest conviction ideas across asset classes.
Success
  • It has delivered top-decile performance over the three- and five-year periods.1
  • Top-quartile performance 88% of the time over rolling three-year period since inception.1


 

Source: J.P. Morgan Asset Management. Data as of 9/30/17. Shown for illustrative purposes only. Past performance is no guarantee of future results

1World Allocation Category. Morningstar as of 9/30/17. I Shares. Ranked: 1-yr. (92/466), 3-yrs. (24/399), 5-yrs. (24/343) and 10-yr. period n/a.

Performance

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Commentary

As of October 31, 2017

Month in review
  • The JPMorgan Global Allocation Fund (I Class Shares) returned 1.6% in October versus the composite benchmark returns of 1.0%.
  • Developed market central banks remained in focus throughout the month as several continued to move away from their highly accommodative monetary policy stances. The European Central Bank announced a well-signaled cut in the pace of its government bond purchases. The Bank of England continued to flag a coming hike in its policy rate. The Federal Reserve (Fed) left rates unchanged, in line with expectations, while markets digested the potential impact of a new Fed chair.
  • Economic data released in October showed continued strong growth for the global economy. Relative to expectations, some of the best news came from the U.S., which produced a string of favorable surprises culminating in a preliminary reading for third-quarter gross domestic product of 3.0%.
Looking ahead
  • An environment of healthy and broad economic growth, decent corporate earnings and still-accommodative monetary policy supports our continued pro-risk stance. We note a move to late cycle in the U.S., but despite modestly expensive valuations, we see room for equity outperformance looking forward. Correlations across equity markets continue to fall suggesting an increased benefit of diversification and further support for our broad regional exposure.
  • We continue to focus our risk in global equities, and maintain an increased exposure to both international developed and emerging markets. In particular, Japan looks attractive with improving earnings revision ratios and corporate profits alongside attractive valuations relative to other developed markets. In emerging markets, strong global growth, rising commodity prices, and a stable-to-weaker dollar all remain supportive of the asset class. Given the expectation for potential future market volatility, we hold some of our global equity exposure in call options as a way to manage risk, but still capture potential market gains.
  • We continue to believe that credit will be the most attractive area within fixed income. While we have maintained a sizeable allocation to U.S. high yield in recent history, the yield opportunity has lessened due to stabilizing commodity prices, declining default rates and a stable macro backdrop. Given current valuations, we prefer to diversify our credit exposure by further reducing U.S. high yield and adding to emerging markets debt. Additionally, we’ve initiated an allocation to short-duration agency mortgages as a way to earn additional income relative to what we can earn on similar short-duration U.S. Treasuries.

Fees and Minimums

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Portfolio

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Management

Fund Managers

Documents

Disclaimer

1Please refer to the prospectus for additional information about cut-off times. Total return assumes reinvestment of income. The Fund's adviser and/or its affiliates have contractually agreed to waive fees and/or reimburse expenses to the extent Total Annual Fund Operating Expenses (excluding acquired fund fees and expenses, dividend and interest expenses related to short sales, interest, taxes, expenses related to litigation and potential litigation and extraordinary expenses) exceed 1.03% for A Shares, 1.53% for C Shares, 0.78% for I Shares, 1.40% for R2 Shares, 0.65% for R6 Shares and 1.03% for T Shares of the average daily net assets. The Fund may invest in one or more money market funds advised by the adviser or its affiliates (affiliated money market funds). The Fund's adviser has contractually agreed to waive fees and/or reimburse expenses in an amount sufficient to offset the fees and expenses of the affiliated money market funds incurred by the Fund because of the Fund's investment in such money market funds. This waiver is in effect through 2/28/2018 for A Shares, 2/28/2018 for C Shares, 2/28/2018 for I Shares, 2/28/2019 for R2 Shares, 8/20/2018 for R6 Shares and 2/28/2018 for T Shares, at which time the adviser and/or its affiliates will determine whether to renew or revise it. The difference between net and gross fees includes all applicable fee waivers and expense reimbursements. Mutual funds have fees that reduce their performance: indexes do not. You cannot invest directly in an index. MSCI World Index (net of foreign withholding taxes) is a broad measure of the performance of developed countries' equity markets. The Bloomberg Barclays Global Aggregate Index provides a broad-based measure of the global investment-grade fixed income markets. Comprised of U.S. Aggregate, the Pan-European Aggregate, and the Asian-Pacific Aggregate Indices as well as Eurodollar and Euro-Yen corporate bonds, Canadian government, agency and corporate securities, and USD investment grade 144A securities. Constituents must be rated Baa3/BBB- or higher by at least two of the following: Moody's, S&P, Fitch. The Global Allocation Composite Index is a composite benchmark of unmanaged indexes that includes 60% MSCI World Index (net of foreign withholdings taxes) and 40% Bloomberg Barclays Global Aggregate (Unhedged USD). The performance of the Lipper Flexible Portfolio 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. An individual cannot invest directly in an index. The Bloomberg Barclays U.S. Aggregate Index is an unmanaged index representing SEC-registered taxable and dollar denominated securities. It covers the U.S. investment grade fixed rate bond market, with index components for government and corporate securities, mortgage pass-through, and asset-backed securities. Total return figures (for the fund and any index quoted) assume payment of fees and reinvestment of dividends (after the highest applicable foreign withholding tax) and distributions. Without fee waivers, fund returns would have been lower. Due to rounding, some values may not total 100%. ©2017, 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 following risks could cause the fund to lose money or perform more poorly than other investments. For more complete risk information, see the prospectus. There may be additional fees or expenses associated with investing in a Fund of Funds strategy. International investing has a greater degree of risk and increased volatility due to political and economic instability of some overseas markets. Changes in currency exchange rates and different accounting and taxation policies outside the U.S. can affect returns.
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.