JP Morgan delivers “first” with hedge fund ETFs

Hedge-fundJP Morgan Asset Management (JPMAM) said its first launches since entering the European ETF business will be the first in Europe to try to deliver returns similar to hedge funds.

The funds have been developed by JPMAM’s quant team and will use investment factors – the concept usually referred to as smart beta – for the ETFs, which have listed on the London Stock Exchange.

The firm expects the returns to be uncorrelated to mainstream assets.

The JPMorgan Managed Futures Ucits ETF will take long and short positions in futures markets and has a return target of cash plus 4%.

The ETF also has a total expense ratio (TER) of up to 57 basis points.

JPMorgan Equity Long-Short Ucits ETF also invests long and short, has the same return objective and a TER of up to 67 basis points.

Massimo Greco, head of European funds at JPMAM, said JPMAM was the first firm in Europe to “introduce systematic, bottom-up capture” of hedge funds styles into an ETF.

Bryon Lake, international head of JPMAM’s ETF business, said: “The increasing availability of lower cost, more liquid and transparent forms of alternative investing has gradually been democratising hedge fund investing for the last several years.”

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