Posted inHead To Head, News, Research

HEAD-TO-HEAD: Invesco vs JP Morgan

FSA compares two Asia-Pacific mixed-asset funds: the Invesco Asia Balanced Fund and the JP Morgan Asia Pacific Income Fund.
by Fund Selector Asia
Performance

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The three-year performance of the two funds versus the category average, in US dollars. Data: FE.

The JP Morgan fund underwent a restructuring in 2012, which resulted in a change of investment strategy. Since then, the fund has outperformed the Invesco fund in each calendar year. It has delivered a higher cumulative three-year return, albeit with a higher volatility.

“The key performance attribution difference came primarily from stock selection,” said Ng. The JP Morgan team “performed a better selection of securities and sectors,” in particular, focusing on energy and financials.

The two funds use different benchmarks, each of which is composed of half bond and half equity indices, although the actual asset allocation of the funds’ holdings between equities and bonds can vary from the 50/50 split.

Both funds use the MSCI AC Asia Pacific ex Japan Index for their equity sleeves. For bonds, the Invesco fund uses the Markit iBoxx ADBI, while the JP Morgan uses the JP Morgan Asia Credit Index.

Measured against these benchmarks, the JP Morgan fund has delivered a higher alpha and a lower beta than the Invesco fund, according to data from FE.

Invesco

JP Morgan

Sector Average
3-year return (cumulative)

7.04%

17.48%

12.55%
1-year return

13.50%

14.18%

20.64%
3-year Alpha

-0.68

0.43
3-year Beta

0.70

0.46
3-year Sharpe Ratio

0

0.35
3-year Volatility

6.97

7.64

1.22

Data: FE, returns in US dollars. All ratios are annualised.

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