JP Morgan AM matches rival in launching cheapest ETF in Europe

Bryon Lake of JPMAM

JP Morgan Asset Management (JPMAM) has waded into the ETF price war in Europe with the launch of a US equity product.

The JPM BetaBuilders US Equity UCITS ETF (BBUS) is listed on the London Stock Exchange, Xetra and Borsa Italiana with a total expense ratio (TER) of 0.04%, matching the cheapest product listed in Europe which was launched by Lyxor last March.

BBUS is the firm’s first move into the core equity space this side of the pond, having already launched core products in fixed income.

Tracking the Morningstar US Target Market Exposure index, BBUS offers investors exposure to large and mid-cap US equities through a basket of around 650 securities.

Speaking to ETF Stream, Bryon Lake (pictured), head of international ETFs at JPMAM, said the launch was in response to client demand for their core exposure to be diversified and at an attractive price.

“We are pumped,” Lake said. “We believe BBUS offers investors and asset allocators more efficient access to US equities in what is an increasingly noisy market place.

“Our BetaBuilder ETF suite is designed to offer clients efficient access to market cap weighted building blocks that are simple, straightforward and priced for today’s market.”

The firm are planning to roll out currency hedged share classes of BBUS at the same price, which Lake noted was one of JPMAM’s key differentiators.

JPMAM is the latest major asset manager to enter the core equity space. Earlier this year, Amundi launched a nine-strong range , all charging 0.05%, while last November, Legal & General Investment Management unveiled its core range, going as low as 0.05%. Lyxor and JPMAM now offer the cheapest exposure in Europe at 4 basis points.

Lake said the firm is planning to use the ETF wrapper “to its maximum potential” by launching a wide spectrum of products, all the way from active ETFs to core and everything in between.

“Issuers are yet to use the ETF wrapper to its maximum potential. We will continue to leverage the JP Morgan business to explore different exposures as there are a lot of opportunities.”

JPMAM entered the European ETF business in November 2017 with two actively managed liquid alternative strategies.

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