A solid team, robust process, and low fees support JPMorgan US Select Equity’s Morningstar Analyst Rating of Silver.
As anticipated, Tom Luddy, who had comanaged this fund since February 2006 and helped develop the strong stock-valuation model at the strategy's centre, stepped back at the end of 2017. His transition was ably handled. Scott Davis, appointed comanager in July 2016 in anticipation of this transition, has since become lead manager. He runs about 65% of the portfolio. Susan Bao, who has been a comanager here since 2001, retains a 10% sleeve of the fund while assuming lead responsibility on the firm's JPM US Select Equity Plus (130/30) strategies.
The process remains designed to outperform incrementally, primarily through stock selection. In running their combined 75% of the fund, Davis and Bao rely extensively on the research of JPMorgan's strong core analyst team using the firm's proprietary dividend-discount model. The remaining 25% is directly managed by the analyst team under the leadership of David Small. Sector weightings stay within close range of the S&P 500's, and positions are rarely as much as 2 percentage points off the benchmark weightings, resulting in a well-diversified portfolio of more than 140 holdings.
As expected, tracking error relative to the S&P 500 has been in a narrow 2%-3% range over time, while active share has been below 60%. That may sound like a recipe for mediocrity, but the fund has consistently outperformed thanks to its numerous, yet modest, stock bets across sectors. Despite some manager changes on the edges over time, the fund's performance is firmly anchored in the top quintile of the US large-blend Morningstar Category during the trailing five- and 10-year periods through December 2017. Those good results testify to the effectiveness of a robust investment process, skillfully executed by a strong team of portfolio managers and analysts. The fund’s low expenses are an additional edge, making this sound core holding even more compelling.
Merk, analysen er skrevet basert på den rene klassen. I Norge er det A Acc som er tilgjengelig og denne har høyere kostnader.
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