HONG KONG: J.P. Morgan Asset Management launches JF Asia Pacific Income Fund
Aug 06, 2012
Hong Kong, 6 August 2012: J.P. Morgan Asset Management (JPMAM) today announced the launch of JF Asia Pacific Income Fund, an Asian multi-asset portfolio capitalising on high income opportunities.
Designed to maximise potential income return and to capture long-term capital growth opportunities, JF Asia Pacific Income Fund invests primarily in income generating securities in the Asia Pacific region excluding Japan. The universe consists of investments drawn from a wide range of asset classes, including high-dividend stocks, REITs, high-yield bonds and investment grade bonds. The Fund employs a flexible, active asset allocation strategy and security selection. The allocation to bonds and equities (including REITs) may range from 25% to 75%, respectively.
One of the key fund features is a monthly distribution^ to investors via the "mth" classes, which are available in both U.S. Dollars and Hong Kong Dollars. As of 18 June 2012, the portfolio yield of the Fund was 6.1% p.a.#. In addition, its U.S. Dollar "dist" class is expected to distribute dividends annually.
Terry Pan, Head of Hong Kong Business at JPMAM, said "JF Asia Pacific Income Fund is an actively-managed, well diversified Asian portfolio which aims to capture the most attractive income opportunities across varying market conditions. The Fund may help investors to compensate for the current low yields by acting as an alternative source of income that is distributed in a timely and efficient manner. It also combines the expertise of JPMAM's Asia-Pacific equity and fixed income teams to manage the portfolio with a bottom-up approach and a focus on sustainable income generation which allows more dynamic allocation between equity and fixed income. In other words, this is not a plain vanilla balanced fund by any means."
Jeffrey Roskell, Fund Manager of JF Asia Pacific Income Fund, said that "High dividend equities tend to exhibit both value and low beta characteristics. Over the very long term, it is this combination that has allowed high dividend yield equities to perform remarkably well relative to the broader index in Asia. An important driver of this has been the lower volatility nature of high income stocks, which means that they have outperformed during periods of market weakness. This historical combination of lower volatility and higher returns over the long term is obviously an attractive combination and one that we would seek to replicate. At this moment in time the equity portfolio of the fund has a beta of about 0.75."
"While we expect markets to remain volatile in the next few months we are also seeing a need from our clients to derive an income on their investments. We see a wide range of stocks in Asia which have high dividend yields and can invest in Asian equities with historic yields that are significantly higher than US treasuries and more than Asian investment grade bonds. Whilst paying out high dividends, these equities still present an opportunity to participate in growth within the Asian region. Recent good performance of high dividend yield stocks certainly suggests that this is starting to be understood by investors, but we still see many opportunities to buy stocks on attractive yields."
Stephen Chang, Fund Manager of JF Asia Pacific Income Fund, said "Growth in Asia is one of the major positive contributors to global growth and we believe Asia remains one of the most promising regions globally, even in these times of difficult and uncertain markets. In our view, the credit fundamentals of Asian companies remain solid, combined with the fact that Asian local currency yields are now higher than U.S. treasuries, the investment outlook in the Asian fixed income space is very attractive."
For investors who are looking for a potentially attractive income stream generated from the fast growing economies of Asia, a more diversified approach to income investing, as well as those seeking to benefit from active asset management which can switch among a multitude of asset classes to meet investment goals in varying market conditions, the Fund may help maximise income opportunities in the current low-yield environment.
From now to 31 August 2012, investors subscribing to JF Asia Pacific Income Fund can enjoy a special initial charge offer at 0.5%. The minimum subscription amount is USD2,000 (or HKD5,000 through the online J.P. Morgan eTrading platform) or monthly investment of HKD1,000 via eScheduler, JPMAM's monthly fund investment tool. JF Asia Pacific Income Fund is restructured from JF Pacific Balanced Fund with the current fund name and investment objective effective from 14 June 2012.
# Source: JPMAM, based on estimated dividend yield of the equity portfolio and current yield of the bond portfolio. The portfolio yield is shown for indicative purposes only and does not represent actual fund distribution. Positive distribution yield does not imply positive return. Dividend is not guaranteed.
^ Positive distribution yield does not imply positive return. Dividend of the Fund is not guaranteed. Distributions of the mth classes may be paid out of capital which represents a return or withdrawal of part of the amount an investor originally invested or from any capital gains attributable to that original investment. Any payments of distributions by the Fund may result in an immediate decrease in the net asset value per unit. All or part of the Fund's fees and expenses may be charged to the capital of the Fund which will result in income being increased for distribution, however, the capital that the Fund has available for investment in the future and capital growth may be reduced.
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For further information please contact:
Daniel Chui, Head of Investor Communications
Telephone: (852) 2800 2874
Issued by JPMorgan Funds (Asia) Limited
Harriet Ngan, Internal & Media Communications
Telephone: (852) 2800 2776
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Notes to Editors
J.P. Morgan Asset Management ("JPMAM") is the brand name of J.P. Morgan Chase & Co's asset management companies, including JPMorgan Funds (Asia) Limited.
J.P. Morgan Asset Management is a global asset management leader providing world-class investment solutions to clients. With over US$1.3 trillion in assets under management (the Asset Management client funds of J.P. Morgan Chase & Co. as at 30 June 2012) and offices in 41 locations around the world, J.P. Morgan Asset Management offers global coverage with a strong local market presence, and leadership positions in most asset classes.
Commitment to Hong Kong
JPMAM's investment management business in Asia has remained headquartered in Hong Kong for more than three decades and today has over 500 employees based in this location. JPMAM and its investment arm - JF Asset Management - are one of the largest local investment managers in Hong Kong with over US$73 billion (30 June 2012) of funds managed across the Asia Pacific region.
As part of a major global investment group, we are committed to providing specialist teams with the resources needed to deliver successful products and performance to our clients. The Hong Kong-based Pacific Regional Group, together with the local presence of the Global Portfolios Group, Global Multi Asset Group and Global Fixed Income Groups, forms the core of JPMAM's investment management operations. In addition to the knowledge and experience of our individual investment professionals, the stability of the team has enabled JPMAM to develop strong relationships with local clients.