Last updated: 13:29 / Thursday, 25 March 2021
Global Income Sustainable Fund

JP Morgan Asset Management Launches a Multi-Asset Fund with a Focus on ESG

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  • The Global Income Sustainable Fund will complement the asset manager's flagship JPMorgan Investment Funds - Global Income Fund
  • The new fund will be run by the same portfolio managers, Michael Schoenhaut and Eric Bernbaum, and will use the same investment philosophy as the Global Income Fund
  • The product will go further on ESG with additional sustainability characteristics that will produce a portfolio with a higher overall ESG score and a materially lower carbon footprint

JP Morgan Asset Management has launched the Global Income Sustainable Fund (SICAV), a globally diversified multi-asset income fund with a sustainable focus. In a press release, the asset manager has announced that this vehicle will complement its flagship JPMorgan Investment Funds - Global Income Fund, with 29 billion dollars in assets under management.

The new fund will be run by the same portfolio managers, Michael Schoenhaut and Eric Bernbaum, and will use the same investment philosophy as the Global Income Fund, taking a flexible approach to seeking out the best sustainable income opportunities from around the globe, leveraging sustainable exclusions and a positive environmental, social and governance (ESG) tilt.

Also, JP Morgan AM has revealed that the new offering will go further on ESG with two additional sustainability characteristics. First, it will exclude companies from 10 unsustainable sectors based on client values, industry norms and regulation. Second, leveraging the firm’s well-established global research capabilities for finding attractive income-producing investments globally, the Global Income Sustainable Fund will be tilted towards securities with more effective governance and superior management of environmental and social issues.

This, in their view, will produce a portfolio with a higher overall ESG score and a materially lower carbon footprint. Reflecting the Global Income Sustainable Fund’s concentration on ESG leaders, the two funds are expected to only have about 30% overlap in holdings. The new vehicle, which will have a TER of 75 basis points (C share class), is expected to register 65% lower carbon emissions than the multi-asset income investment universe.

“In the continued incredibly low yield environment, investors need more sustainable sources of diversified income. For more than a decade with our Global Income Fund, we’ve provided investors with a disciplined and rigorous approach, supported by strong research capabilities, to finding the best risk-adjusted income opportunities globally, across multiple geographies and asset classes. We’re thrilled to now expand our offering with this dedicated sustainable multi-asset income fund,” said Massimo Greco, Head of EMEA Funds at JP Morgan AM.

Meanwhile, Rob Stewart, Global Head of the Multi-Asset Solutions Investment Specialist team, pointed out that a huge challenge for sustainable multi-asset income investing is incorporating widely varying ESG factors, from across different asset classes, and bringing those together into a diversified portfolio that produces attractive risk-adjusted income.

"That’s why we believe it is critical for sustainable multi-asset investors to leverage well-established fundamental and quantitative research capabilities. We’re able to draw on over 50 years of experience in multi-asset investing. This enables us to optimize top-down global asset allocation to strive for stable income, while the fund’s bottom-up asset class specialists focus on the most sustainable securities within their respective sub-asset classes,” he added.

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