Investments  

JPMAM launches long/short UK equity fund

JPMAM launches long/short UK equity fund

JPMorgan Asset Management has added a UK Equity Plus fund to its active extension range.

The fund will be run by James Illsley, Nicholas Horne and Callum Abbot.

The active extension strategy involves the use of derivatives to increase returns relative to the equity benchmark and short stocks the managers think are unattractive.

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The portfolio’s net exposure to the equity market will remain 100 per cent.

JPMorgan already runs a pan-European SICAV version of this strategy, the Europe Equity Plus fund. However, this fund was soft closed in October 2014 after a surge in flows.

The fund aims to outperform the FTSE All-Share index by investing in 70 to 220 long positions and 35 to 100 short positions. It has an alpha target of 3.5 per cent.

Mr Illsley said: “The concentration of the UK equity market, which is heavily skewed towards large companies, really lends itself to active extension.

“Beyond the handful of megacap stocks that dominate the FTSE All-Share index, the vast majority of companies have index weights less than 0.5 per cent of the index.”

The fund’s C share class will have a total expense ratio of 1.13 per cent.