JP Morgan Asset Management has launched the JPMorgan Diversified Return Emerging Markets Equity ETF (JPEM), expanding the firm’s strategic beta ETF suite.
JPEM, like its predecessors JPGE and JPIN, seeks to provide investors with enhanced risk-adjusted returns and to help financial advisors keep clients invested in equities over the long term.
JPEM addresses drawbacks inherent in market cap-weighted indices, specifically excessive risk concentrations and a large number of securities with unattractive characteristics. The ETF tracks the FTSE Emerging Diversified Factor Index, which employs a unique risk framework to distribute risk across regions and sectors and a multi-factor stock filter to rank and select stocks based on value, quality and momentum. The index construction also incorporates quarterly rebalancing and liquidity screens.
"We believe that JP Morgan has emerging markets capabilities and investment insights that will be attractive to investors, and this product is an important additional step in delivering those capabilities, with an eye toward better risk-adjusted returns," says Robert Deutsch, Global Head of ETFs for JP Morgan Asset Management. "This ETF is also a good option to provide diversification for client portfolios that are overweight developed markets."
"We are delighted to start 2015 with another FTSE index-linked ETF from JP Morgan, using the diversified return suite methodology we co-developed last year to bring ground-breaking multi-factor indices to the market," says Jonathan Horton, Chief Marketing Officer, FTSE Group.
