Posted inHead To Head

HEAD-TO-HEAD: JP Morgan AM vs Schroders

FSA compares the JP Morgan Japan Equity Fund and the Schroder ISF Japanese Opportunities Fund.
by Francis Nikolai Acosta

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Conclusion

The JP Morgan fund receives a Morningstar analyst rating of Bronze and a five-star rating, while the Schroders fund receives a Neutral analyst rating and a four-star rating.

Morningstar’s analyst rating is a forward-looking analysis of a fund, while the star rating looks at historical risk-adjusted performance.

Yew prefers the JP Morgan fund over the Schroders fund, based on the Morningstar ratings.

He said the JP Morgan fund may appeal to investors who do not mind investments in companies with relatively high valuations and have a high risk tolerance, given the fund’s slightly shorter investment horizon.

“For the Schroders fund, the reservation that we have is around its capacity issue. The AUM has grown too big where the manager cannot invest in some of the small cap names,” he said.

That said, he believes that the Schroders fund may appeal to investors who are more long-term oriented, given the fund’s lower turnover when compared to the JP Morgan fund.

“The Schroders manager has shown that he is willing to be patient, especially for small cap names, which take longer for their investment thesis to play out. So investors who are willing to ride out short-term underperformance or volatility may find the Schroders fund appealing,” he said.

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