Industry Updates

JP Morgan AM issue first active equity ETFs

George Geddes

a man in a suit and tie

The latest range JP Morgan Asset Management (JPMAM) is launching is the active equity ETF range, the first of its kind the firm is issuing. The 3-strong range will be listing on the London Stock Exchange, Deutsche Boerse Xetra and Borsa Italiana on 16 October.

The active equity ETF range consists of:

  • JPM Europe Research Enhanced Index Equity (ESG) UCITS ETF (JREE)

  • JPM US Research Enhanced Index Equity (ESG) UCITS ETF (JREU)

  • JPM Global Research Enhanced Index Equity (ESG) UCITS ETF (JREG)

JREE will be benchmarked against the MSCI Europe Index, JREU with the S&P 500 Index and JREG with the MSCI World Index, all with a TER of 0.25%.

The ETF's selection process will consider environmental and social governance (ESG) factors. The ESG factors leads to the exclusion of companies within controversial markets such as tobacco and weapons which numerous ESG based ETFs are doing.

Bryon Lake, head of international ETFs at JPMAM, said: "We are delighted to be delivering the first-of-their-kind active equity ESG ETFs. This is the type of innovation our clients and the industry have been looking for. These ETFs seek to incorporate the best of both active and passive management and can play a versatile role in portfolios, including as a cost-effective core exposure to certain equity markets or as an asset allocation tool."

After issuing its first ETF in November of last year, JPMAM now "offer solutions across equities, fixed income and alternatives" Lake mentions. Speaking at the Inside ETFs Europe event this week, Lake was asked why JPMAM were so late to the ETF party to which he replies, "you can never be late to something that never ends".

Only briefly touching on the equity ETFs, Lake was very enthusiastic about the use of ETFs within fixed income. He highlighed the positives an investor would face such as "immediate diversification by receiving a basket of bonds and sizing down to one share as you only need a single ETF". Additionally, he adds that ETFs is an efficient way to gain exposure to the fixed income market and would be a strong driver through Europe.

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