JPMAM launch multi-asset income fund

With interest rates at historic lows, there has never there been more discussion around the search for yield and with this in mind, J.P. Morgan Asset Management have launched the JPM Multi-Asset Income OEIC with a target yield of 1 month GBP LIBOR +2.5% gross. However, under current conditions, a yield of 7 to 8%, or approximately 6% over 3 month LIBOR is expected.

The Fund will be different to many other UK retail funds, as it uses multiple asset classes to meet this income target requirement, rather than simply equity income. The fund will invest in a diversified mix of high yielding securities ranging from global equities including high dividend companies and REITs and global fixed income including investment grade, emerging market debt, high yield corporates and convertibles. As many of these assets classes were affected by last year's market disruption, this is an excellent time to be using these assets for income.

The UCITs III fund will be managed by Michael Schoenhaut and Michael Fredericks from the US. The portfolio is designed to imitate as closely as possible the US domestic fund, the JPM Income Builder Fund, launched in May 2007 and the more recently launched JPM Global Income SICAV, which is up over 12% excluding yield since its launch in December 2008.

The GBP denominated fund will distribute income quarterly, will sit within the IMA Specialist sector and is set to compete directly with existing offerings from Invesco Perpetual, Jupiter and Schroders.

Jasper Berens, head of UK retail sales at J.P. Morgan Asset Management commented: "It's clearly not easy to find a good level of income return on your cash at present and we believe this fund offers a competitive yield, seeking income opportunities globally whilst offering diversity across asset classes. This enables the managers to take advantage of asset classes as and when they feel is appropriate. We believe this is absolutely the right fund to launch, particularly in this economic environment, where income asset allocation decisions are crucial yet understandably daunting for the end investor especially with yields so low. J.P. Morgan Asset Management, through this fund, will take away the confusion and make those decisions so the investor does not have to, delivering a consistent and decent level of income in a historically low interest rate environment."

Berens continued: "As this is purely an income fund, it is a perfect complement to any portfolio looking to supplement existing income targets and of particular interest to those wishing to supplement income in retirement. J.P. Morgan Asset Management's global expertise across asset classes and intricate knowledge of local markets is crucial to the success of this fund and we're confident we will deliver, what will be a very decent level of return."