JPMorgan Large Cap Value Fund - A - J.P. Morgan Asset Management

As of April 3, 2017, this fund's Select share class has been renamed to I. Please see the prospectus for more details.

Designed To

Designed to provide capital appreciation primarily through a portfolio of U.S. large cap value stocks.


  • Analyzes company prospects for as long as five years, to gain insight into a company's real growth potential
  • Research-driven approach focuses on identifying the most undervalued securities in each sector
  • Looks for attractive valuations as well as catalysts for stock price increases, higher potential reward versus risk, and temporary mispricing caused by market overreactions


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As of June 30, 2017

Quarter in review
  • The JPMorgan Large Cap Value (I Class Shares) outperformed its benchmark, the Russell 1000 Value Index, for the quarter ended June 30, 2017.
  • Delta Air Lines, Inc. (2.4% portfolio weighting) shares have performed well amidst an improving industry backdrop and positive commentary from their recent analyst day. Revenue strength is building broadly as business travel markets continue to recover; in addition management expects positive momentum to continue. Delta has demonstrated continued yield improvement, better PRASM results, cost discipline and restrained capacity growth. We view Delta as a high quality industrial with multiple revenue and earnings growth initiatives. We like that it generates significant free cash flow and management returns cash to shareholders through a growing dividend and repurchases.
  • Citigroup, Inc. (4.4% portfolio weighting) shares did well under the backdrop of higher rates, which caused sentiment to turn more positive on the financials broadly. The combination of decent loan growth, rising rates, and ample capital/return yield creates a compelling picture for the financials. In the last week of the quarter, stellar Comprehensive Capital Analysis and Review (CCAR) results acted as an additional catalyst as Citigroup’s return of capital plan was approved, suggesting that Citigroup has made sufficient progress improving its financial profile. Improvements in the business are a function of management controlling expenses and investing in the card, wealth management and Mexican franchises. Looking ahead, we think there’s room for the additional return of capital to shareholders.
  • We originally purchased Macy's, Inc. (0.0% portfolio weighting) because of its attractive valuation, particularly as we considered two factors. First, based on credit card data checks, trends appeared to be better than department store peers. Second, we felt the company had real estate optionality. Our thesis has not played out: Macy’s has underperformed as investors are frustrated with the slow pace of management’s ability to monetize the company’s real estate position. We exited the position since we were similarly disappointed with management’s commentary about its real estate strategy.
  • Despite reporting strong quarterly results, the market yawned as investors are more concerned about weakening original equipment manufacturer (OEM) fundamentals, which caused General Motors Co. (3.6% portfolio weighting) to be among the portfolio’s laggards. We own GM because of its superior cost discipline, inventory management and product cycle relative to OEM peers. The valuation is attractive and management is highly focused on driving performance and increasing shareholder value, with a track record of prudent capital allocation.
Looking ahead
  • Our approach leads us to invest in companies with compelling valuations, combined with contrarian sentiment and risk control. We remain overweight in the more cyclical areas of the market and underweight in the bond proxies.
  • Three themes that we expect to persist are: 1) downward pressure on oil prices, 2) relative economic strength in Europe, and 3) higher interest rates globally. These macroeconomic views have been reflected in the portfolio by neutralizing our relative underweights to some of the large multinationals in our benchmark.
  • We continue to think that higher rates will be a tailwind for financials and we’ve intentionally tilted this exposure to firms with a greater international presence. We continue to be underweight in energy, yet prefer to have exposure to Permian Basin producers.
  • The portfolio continues to have large exposures to stocks that are identified as cheap within our dividend discount model, exhibit good free cash flow and strong cash flow return on investment.

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 0.93% for A Shares, 1.45% for C Shares, 0.80% for I Shares, 1.30% for R2 Shares, 0.60% for R5 Shares and 0.55% 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 10/31/2017 for A Shares, 10/31/2017 for C Shares, 10/31/2017 for I Shares, 10/31/2018 for R2 Shares, 10/31/2017 for R5 Shares and 10/31/2017 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 1000 Value Index is an unmanaged index measuring the performance of those Russell 1000 companies with lower price-to-book ratios and lower forecasted growth values.

The performance of the Lipper Large-Cap Value 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.

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.
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.

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.