JPMorgan Starts Converting $938M Mutual Fund To ETF

May 06, 2022

JPMorgan Asset Management Inc. began converting its JPMorgan Market Expansion Enhanced Index Fund into a mutual fund Friday ahead of its debut on the NYSE Arca. 

The mutual fund will trade as the JPMorgan Market Expansion Enhanced Equity ETF (JMEE) starting Monday. It has an initial expense ratio of 0.24% after applying a 10 basis point waiver through June 2025, undercutting its mutual fund fee by 36 basis points. 

JMEE retains its target of outperforming the S&P 1000 through overweighting or underweighting high- and low-conviction stock picks compared to the index. It has broadly underperformed its benchmark, beating the index just four times since 2012 on a calendar year basis. The fund posted a 27.49% gain at net asset value in 2021 versus the S&P 1000’s 25.35%, but trailed with a 9.86% gain versus a 12.98% return for the index. 

The conversion is the second of four mutual funds that J.P. Morgan began changing over last summer. The $1.1 billion JPMorgan Inflation Managed Bond ETF (JCPI) converted in early April. 

The $1.2 billion JPMorgan Realty Income Fund and the $5.4 billion JPMorgan International Research Enhanced Equity Fund are due to convert in late May and early June, respectively, according to regulatory filings. 

JMEE’s imminent conversion will bring the number of ETF assets converted from mutual funds to just over $2 billion this year. 
 

Contact Dan Mika at [email protected], and follow him on Twitter 

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