New York, NY, January 22, 2017 – J.P. Morgan Asset Management has announced that it has signed a letter of intent to negotiate a license for Precidian Investments LLC’s patented intellectual property relating to the offering of actively-managed, periodically-disclosed exchange-traded funds (ETFs).
The Precidian model, subject to applicable regulatory approvals, would allow J.P. Morgan to deliver actively managed investment strategies in an ETF vehicle without disclosing holdings on a daily basis. Precidian is seeking approval for use of ActiveShares(SM) from the SEC.
“J.P. Morgan has world class active management capabilities and we are excited to be able to deliver those capabilities to our advisor clients in ETFs just as we do in other products,” said Bob Deutsch, Head of ETFs for J.P. Morgan Asset Management. “Advisors want and use multiple types of investment vehicles to suit different client portfolios, and we are looking forward to helping meet those needs.”
Precidian's CEO, Daniel McCabe, stated “we are thrilled to work with J.P. Morgan on what we hope will be the new standard for actively-managed, periodically-disclosed ETFs. Innovation is a hallmark of the asset management industry, and we are excited to continue working to bring new active strategies to investors.”
J.P. Morgan’s intent to license the ActiveShares (SM) methodology is further evidence of its ongoing commitment to ETF innovation and delivering its best investment management thinking in an ETF format.
J.P. Morgan Asset Management's ETF suite features eleven product offerings with over $1 billion in assets under management. J.P. Morgan achieved a top ten position in flows across smart beta ETFs in 2016, ranking #8 out of 47 ETF managers. J.P. Morgan was also named one of the "Most Trusted" ETF providers according to Cogent Reports' 2016 Advisor Brandscape report and was awarded "Most innovative equity ETF – performance" award by Fund Action for its JPMorgan Diversified Return Global Equity (JPGE) product.
Precidian's patented structure seeks to combine the most beneficial aspects and protections of traditional investment management products with the efficiencies and flexibilities of an ETF. The patented ETF structure seeks to provide asset managers with the ability to generate alpha without daily disclosure of their proprietary strategies while simultaneously creating significant improvements in tax efficiency, manager flexibility and lower operating costs. Investors also can enjoy significant benefits associated with intraday access to their money through transactions on regulated exchanges and simplified choice through a single share class.
About J.P. Morgan Asset Management
J.P. Morgan Asset Management, the marketing name for J.P. Morgan Investment Management, with assets under management of $1.8 trillion (as of December 31, 2016), is a global leader in investment management. J.P. Morgan Asset Management’s clients include institutions, retail investors and high-net worth individuals in every major market throughout the world. J.P. Morgan Asset Management offers global investment management in equities, fixed income, real estate, hedge funds, private equity and liquidity. JPMorgan Chase & Co. (NYSE: JPM), the parent company of J.P. Morgan Asset Management, is a leading global financial services firm with assets of approximately $2.5 trillion (as of September 30, 2016) and operations in more than 60 countries. Information about JPMorgan Chase & Co. is available at www.jpmorganchase.com.
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