JPMorgan Strategic Income Opportunities Fund - A - J.P. Morgan Asset Management
CLOSE

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

JPMORGAN STRATEGIC INCOME OPPORTUNITIES FUND

Complement your core.

Using an absolute-return-oriented approach, the Strategic Income Opportunities Fund invests flexibly across traditional, alternative and private fixed income which seeks to provide uncorrelated, low volatility returns regardless of market environment.

Fund Story   Commentary  

Key Points

Expertise
  • Lead portfolio manager Bill Eigen maximizes the insights of his proven team of absolute return investors with niche market expertise.
Portfolio
  • With its ability to provide uncorrelated, low volatility returns, this benchmark-agnostic portfolio may act as a diversifier to traditional fixed income, a hedged credit option or an alternative strategy.
Success
  • Top decile 5-year Sharpe ratio in Morningstar Non-Traditional Bond Category.1
PERFORMANCE DURING PERIODS OF RATE VOLATILITY

Chart source: J.P. Morgan Asset Management. Data as of 3/31/17. Past performance is no guarantee of future results.

1Sharpe Ratio measures a manager’s excess return over the risk-free rate of return (normally the cash return), divided by the standard deviation; The Fund (I Shares) was ranked: 1 yr. (67/359), 3-yrs. (85/259), 5-yrs. (18/196) and 10-yrs. n/a.

Absolute return bond investing: multiple approaches to mitigate risk

Bill Eigen | July 15, 2014

Portfolio manager Bill Eigen describes his philosophy toward absolute return fixed income investing.

Performance

Performance widget loading ...

Commentary

As of June 30, 2017

Month in review:
  • June was a tale of two halves. Early in the month, European Central Bank (ECB) President Mario Draghi led the Eurozone towards continued excessive accommodation, which caused rates to move much lower across Europe. However, coordinated hawkish central bank messaging at the end of the month reversed the relentless flattening of the yield curve.
  • While the testimony of former FBI Director James Comey was a non-event as far as financial markets were concerned, the Fed raised the Fed funds rate for the second time this year in mid-month, while laying out a plan to reduce its massive $4.5 trillion balance sheet, which should start in the near term.
  • As of now, it appears the Fed will allow $6 billion of U.S. Treasury exposure to roll off monthly, and $4 billion for agency mortgages, with these caps increasing over time to limit market impact. While one would expect this to cause interest rates to rise, a lack of global inflation has yield curves flattening, with rates near their year-to-date lows yet again, although this reversed somewhat at the end of the month.
  • Looking forward, commodity prices are again on top of investors’ minds due to the large oil selloff and the implications this has for global investors. In addition, we may learn of nominations to fill vacant Fed seats in addition to Janet Yellen’s future, as her term is set to expire in February 2018. This of course would have implications for global markets.
Looking ahead:
  • The first half of the year was fairly quiet from a historical volatility perspective and we do expect more volatility in the back half of 2017.
  • Global energy prices impact everything from the health of emerging markets to consumer spending habits, so we will be keeping a close eye on commodity prices and the impact for global risk and rate markets.
  • Most market participants believe it’s a close call whether the Fed hikes again in 2017; however, our team also believes it will be imperative to watch the impact of the beginning of the wind down of the Fed’s balance sheet.
  • We are also paying close attention to the ECB as any sign of inflation may cause a change in policy. The ECB has remained very accommodative; however, growth and labor markets are improving. In addition, a reduction in geo-political risks may make it more likely that the ECB moves towards a less accommodative policy in the third quarter.

Fees and Minimums

Fees widget loading ...

Portfolio

Portfolio widget loading ...

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 1.00% for A Shares, 1.50% for C Shares, 0.75% for I Shares and 0.55% for R5 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 6/30/2017 for A Shares, 6/30/2017 for C Shares, 6/30/2017 for I Shares and 6/30/2017 for R5 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.

The Bloomberg Barclays U.S. Universal Index represents the U.S. Aggregate Index, the U.S. High-Yield Corporate Index, the 144A Index, the Eurodollar Index, the Emerging Markets Index, and the non-ERISA portion of the CMBS Index.

The BofA Merrill Lynch 3-Month U.S. Treasury Bill Index is comprised of a single issue purchased at the beginning of the month and held for a full month. The index is rebalanced monthly and the issue selected is the outstanding Treasury Bill that matures closest to, but not beyond 3 months from the rebalancing date.

The performance of the Lipper Alternative Credit Focus 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.

Securities rated below investment grade are considered "high-yield," "non-investment grade," "below investment-grade," or "junk bonds." They generally are rated in the fifth or lower rating categories of Standard & Poor's and Moody's Investors Service. Although they can provide higher yields than higher rated securities, they can carry greater risk.

International investing bears greater risk due to social, economic, regulatory and political instability in countries in "emerging markets." This makes emerging market securities more volatile and less liquid developed market securities. Changes in exchange rates and differences in accounting and taxation policies outside the U.S. can also 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.

Duration: Measures price sensitivity of fixed income securities to interest rate changes.

Average Life: The length of time the principal of a debt issue is expected to be outstanding.