JP Morgan Asset Management has added four currency-hedged versions to two of its smart beta ETFs. The new additions are part of its three-year plan of rolling out 50 ETFs.
The banking giant launched the two previous alternative beta ETFs back in November 2017, as a way of breaking into the European ETF market. The four new ETFs include both a sterling and a euro share class for the JPM Equity Long-Short UCITS ETF and the JPM Managed Futures UCITS ETF. The sterling-hedged versions will be listed on the London stock exchange and the euro-hedged version will be listed on the Deutsche Boerse Xetra and Borsa Italiana.
The new ETFs are using advanced factor-based investing techniques to provide similar returns to hedge fund strategies. The hedged and unhedged share classes will have the same expense ratios, with the managed futures and equity long-short charging 0.57% and 0.67% respectively.
Bryon Lake, international head of ETFs at JPMAM, said the new ETFs were created to meet client demand for professionally managed currency risk as they invest across the UK and continental Europe.
“Currency hedging can help investors mitigate the impact of foreign exchange movements on their investment returns. Having access to home currencies, via these currency-hedged share classes, should help clients meet both their operational and/or legal requirements,” he said.