JP Morgan Asset Management has launched its first alternative and actively managed exchange-traded fund, JPMorgan Diversified Alternatives ETF (JPHF).
It is designed to provide diversified exposure to hedge fund strategies including equity long/short, event driven and global macro strategies.
JPHF was designed and is managed by Yazann Romahi, global head of quantitative beta solutions at JP Morgan Asset Management. A pioneer in hedge fund beta investing, Romahi created the ETF with the support of a team of 17 investment specialists who have been focused on beta philosophy research and development for more than a decade.
The team manages over USD3.5 billion of assets in alternative beta with this ETF being the latest extension of their offering.
JP Morgan says JPHF is aiming to democratise hedge fund investing by providing investors with institutional quality hedge fund strategy in a cost efficient, tradeable ETF wrapper.
The ETF can serve as a core component of a portfolio's alternatives allocation. The bottom-up approach results in a purer capture of the hedge fund exposure and better diversification than traditional hedge fund replication strategies, as it employs strategies that have true low correlation to traditional markets.
"In the past, alternative investments have been an exclusive option only accessible by a small portion of investors; however, JPHF now makes these investment vehicles available to a wider array of investors," says Robert Deutsch, gead of ETFs for JP Morgan Asset Management. "Alternative beta strategies provide investors with true diversification with attractive liquidity, transparency and cost."
"Since 2005, we've had a team dedicated to researching and developing a leading alternative beta capability and we are thrilled to adapt this strategy for a new investment wrapper," says Romahi. "JPHF helps to increase diversification, reduce overall portfolio volatility and deliver higher portfolio risk-adjusted returns."