Posted inHead To Head

HEAD-TO-HEAD: JP Morgan versus Neuberger Berman

FSA compares two US value equity products: the JP Morgan US Value Fund and the Neuberger Berman US Multi Cap Opportunities Fund
by Rupert Walker

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Conclusion

 

The two funds are well-run and have solid performance records, and therefore fit well into an investment portfolio, according to Poole.

“However, they have different roles and meet complementary needs,” he said.

The JP Morgan fund typically has a larger exposure to top quality companies with strong balance sheets, especially healthy free cash flow.

“Its value focus means that it offers downside protection in bear markets, yet it also has some flexibility to take opportunistic positions which helps performance when markets rebound,” said Poole.

Meanwhile, the Neuberger Berman fund’s substantial exposure to cyclical stocks means that it is an excellent market recovery vehicle. Its ability to exploit “special situations” when markets are weak, should also gives returns a boost beyond those normally generated from pure value-oriented products.

“It is the sort of fund that can act as a core holding,” said Poole.

Yet, both funds have important functions as defensive and recovery plays, and demonstrate that “value investing is not yet dead and buried”, despite the emphasis on ‘growth’ investing in recent years,” he added.

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