JPMorgan Growth Advantage Fund - R5 - J.P. Morgan Asset Management


Growth investing with freedom to roam.

Anchored in large-cap growth stocks, the Growth Advantage Fund has the flexibility to pursue compelling growth opportunities across all market capitalizations.

Fund Story  

Key Points

  • Experienced portfolio manager Tim Parton is supported by 10 dedicated growth analysts.
  • Seeks companies with large or growing addressable markets, a sustainable competitive advantage and strong management execution.
  • Flexibility to invest in the best growth companies regardless of market capitalization.
  • Top-decile performance, batting average and information ratio over the 5-yr. period.1
EXCESS GROWTH OF $100,000 over 10 years

Compared to benchmark and category average, in thousands (difference vs. benchmark)

Source: Morningstar, J.P. Morgan Asset Management; as of 9/30/17. Morningstar Large Growth Category. Returns shown are for the I 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. The Fund changed its investment strategy from a mid-cap to multi-cap fund on 8/31/05. 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.

1The Fund (I Shares) was ranked: 1-yr. (101/1398), 3-yrs. (101/1259), 5-yrs. (52/1125) and 10-yrs. (63/800). Batting average measures consistency—calculated by dividing the number of months where the manager beats/matches the index by the total number of months in the period: 1-yr. (1/1465), 3-yrs. (4/1402), 5-yrs. (3/1379) and 10-yrs. (29/1164). For information ratio, the excess return vs. the benchmark divided by tracking error. 1-yr. (32/1465), 3-yrs. (120/1402), 5-yrs. (72/1379) and 10-yrs. (88/1164). Past performance does not guarantee future results.

The growth advantage strategy

Tim Parton, portfolio manager, suggests that by focusing on investment in the best companies regardless of capitalization, this innovative strategy offers two key advantages that make it stand out.


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As of September 30, 2017

Quarter in review
  • The JPMorgan Growth Advantage Fund (I Class Shares) outperformed the benchmark, the Russell 3000 Growth Index, for the quarter ended September 30, 2017.
  • An overweight position in Kite Pharma, Inc. (0.8% portfolio weighting) was the top contributor during the quarter. The clinical-stage biopharmaceutical company focusing on the development of immunotherapy drugs was acquired by Gilead Sciences via an all-cash offer that equated to a 29% premium. From a strategic perspective, the deal provides Gilead a strong foundation in oncology.
  • An overweight position in Spark Therapeutics, Inc. (0.6% portfolio weighting) was a top contributor during the quarter. The gene therapy company contributed to performance during the quarter after releasing positive clinical data on its hemophilia gene therapy drug. The data was highly anticipated and well-received due to significant safety control, which their competitors lack. While the study is still in early trials, the data supports our thesis that the company is poised to be a leader in the space.
  • An overweight position in Evolent Health, Inc. (0.5% portfolio weighting) detracted during the quarter. Evolent Health provides health system consulting and is a lead player in the ongoing industry transition towards a value-based health-care delivery model. The company beat topline expectations and reiterated earnings guidance; however, the announcement of an unexpected $175 million secondary equity financing led to selling pressure. Later in the quarter, management detailed a number of expanded relationships, which will add new enrollees on its platform, so the stock regained a portion of the losses. We remain confident in the long-term outlook for the business.
  • An overweight position in Acuity Brands, Inc. (0.4% portfolio weighting) detracted during the quarter. Acuity Brands, a market leader in LED lighting fixtures and controls, detracted from performance despite beating earnings expectations in the quarter. While non-residential names generally underperformed, retail demand and pricing continued to be a near-term challenge for the company due to increased Chinese competition. In addition, new product lines running with lower efficiencies continued to impact margins. We trimmed our position, but maintain a modest position given increasingly low expectations and potential for margin improvement.
Looking ahead
  • We continue to see disruption and secular growth in a variety of industries. We are finding attractive opportunities in information technology, which remains the largest overweight in the portfolio followed by financials.
  • As is typical, we have a notable underweight in consumer staples and consumer discretionary.

Fees and Minimums

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Fund Managers



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 1.14% for A Shares, 1.64% for C Shares, 0.89% for I Shares, 1.39% for R2 Shares, 1.14% for R3 Shares, 0.89% for R4 Shares, 0.74% for R5 Shares and 0.64% for R6 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 10/31/2019 for A Shares, 10/31/2019 for C Shares, 10/31/2019 for I Shares, 10/31/2019 for R2 Shares, 10/31/2019 for R3 Shares, 10/31/2019 for R4 Shares, 10/31/2019 for R5 Shares and 10/31/2019 for R6 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.

The quoted performance of the Fund includes performance of a predecessor fund/share class prior to the Fund's commencement of operations. Please refer to the current prospectus for further information.

Mutual funds have fees that reduce their performance: indexes do not. You cannot invest directly in an index.

The Russell 3000 Growth Index is an unmanaged index measuring the performance of those Russell 3000 companies (largest 3000 U.S. companies) with lower price-to-book ratios and lower forecasted growth values.

The performance of the Lipper Multi-Cap Growth 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 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 Morningstar RatingTM for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10- year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods.Rankings do not take sales loads into account.
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.

Effective November 22, 2017, the calendar year performance of the R2, R3 and R4 share classes, prior to the inception of each share class, were recalculated to take into consideration the expenses of the respective share class.

Small-capitalization investments typically carry more risk than investments in well-established "blue-chip" companies since smaller companies generally have a higher risk of failure. Historically, smaller companies' stock has experienced a greater degree of market volatility than the average stock.
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.

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