Results analysis from Kepler Trust Intelligence

JPMorgan American IT PLC

28 March 2024

 

JPMorgan American (JAM)

28/03/2024

Results analysis from Kepler Trust Intelligence

JPMorgan American (JAM) produced a net asset value total return of 24.7% in the year to 31/12/2023 compared to the trust's benchmark, the S&P 500, which produced an 18.9% total return. Since JAM implemented its current investment strategy on 01/06/2019 to the end of February, it has generated a NAV total return of 116.3% compared with a benchmark return of 97.3%, an annualised outperformance of 2.2 percentage points. 

This performance has, in our view, cemented JAM's position as a core holding, and even as the investment trust sector is on average experiencing very wide discounts, driven by sentiment and technical issues such as cost disclosures and the consolidation of the wealth management industry, a significant shareholder of investment trusts, JAM has retained a narrow discount or premium. JAM in our view provides a template for what a successful equity investment trust looks like: an investment proposition that is clearly understandable, adds value through a well-thought-out active strategy as well as through gearing, and which is able to step in and buy shares back when needed, without any particular concerns about what that might do to the portfolio mix, or to gearing. With M&A picking up speed in the investment trust sector, JAM is a good example for trusts wondering what the benefits of scale are w, not least because JAM's significant outperformance came with an ongoing charges figure of 0.38%.

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