Fund Profile


Disclosure – Non-Independent Marketing Communication

This is a non-independent marketing communication commissioned by JPMorgan Emerging Markets. The report has not been prepared in accordance with legal requirements designed to promote the independence of investment research and is not subject to any prohibition on the dealing ahead of the dissemination of investment research.

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JPMorgan Emerging Markets (JMG) owns a portfolio of companies selected for their long-term sustainable growth prospects. JMG has been managed by Austin Forey since 1994, and he takes a high conviction, low turnover approach, trying to outperform by looking out beyond the short-term investment horizon of many market participants.

Austin has therefore made minimal changes to his portfolio throughout the pandemic, during which JMG has generated strong outperformance, as it has done consistently over the past decade (see performance section). However, in the first few months of 2021 the portfolio has slightly underperformed the MSCI Emerging Markets Index, as value stocks have outperformed growth. This market environment is not optimal for the strategy, and we note that valuations on the portfolio are now high relative to history and the market. Nevertheless, Austin remains focussed on the long-term growth prospects, believing that cyclical and valuation factors can influence returns in the short to medium term, but over the long run it is superior earnings growth that provides outperformance.

Austin’s extensive experience has included managing emerging markets portfolios through various crises and their aftermaths. This experience has led him to prefer low levels of leverage on portfolio companies, which proved helpful during the pandemic and we believe could prove helpful during any prolonged or difficult economic recovery. Doubtless this helped him resist the urge to chase performance when the crisis hit too. As a part of standard succession planning, in March 2021 Austin was joined by John Citron on the management team (see management section).

Following strong performance in recent years, the discount has narrowed to 2.7% compared to an AIC Global Emerging Markets sector average of 6%.

Analyst's View

JMG stands out as the leading emerging markets trust thanks to its excellent long-term returns, but is also top decile when the much larger open-ended fund sector is included in the analysis. We think it stands out for other reasons too: the long tenure of the manager gives shareholders the benefit of experience that is second to none, the well designed and rigorously implemented strategy gives consistency to the stock selection process, the long holding period reduces transaction costs and should increase the chance of adding alpha, while the resources devoted to risk management, including to ESG risks, puts it in a strong position to avoid pitfalls in individual companies and to encourage positive change.

However, JMG is expensive, both at a portfolio (relative to history and the market) and a share price level (assessing the discount). Valuation expansion has driven much of the recent outperformance, and portfolio companies will likely need to meet or exceed analysts’ earnings expectations to justify current prices or move them higher. We think investors should focus on the longer-term at this point in time; Austin’s track record shows he can generate high levels of alpha over the long run (although of course investors cannot assume past performance patterns will repeat).

The market’s current preference for value over growth is a near term headwind. However, we would argue JMG’s quality growth approach is arguably more resilient to a recovery from a global crisis than a high octane growth strategy and, while there is exuberance in markets, the challenges for economies to recover from the last year remain significant.

bull bear
Long-term approach to stock-picking has led to consistent outperformance
Strong style and sector biases could lead to underperformance at times
A manager with vast experience in the region who has worked through numerous crises
Reticence to gear limits potential in rising markets (as it limits losses in falling markets)
Huge research team allows for full and detailed coverage
Portfolio is expensive and share price discount narrow, increasing short-term downside risks
Continue to Portfolio
2024 Kepler Growth Rated Fund

This trust has been awarded a rating by Kepler Trust Intelligence for growth... Find out more

Fund History

24 Jan 2024 Fund Analysis
JMG aims to hold multi-cycle winners over the long run…
17 Jan 2024 Top of the Pops
We reveal the winners of our investment trust ratings for 2024…
20 Sep 2023 Five questions about emerging markets
We track key developments in the diverse emerging markets universe…
12 Apr 2023 Fund Analysis
(LON:JMG) JMG aims to own multi-cycle winners for the long run…
11 Jan 2023 Solving the Rubik’s Cube
We reveal the winners of our investment trust ratings for 2023…
16 Nov 2022 Fund Analysis
JMG is trading on a wide discount relative to history…
13 Jul 2022 Ready player one
We wonder where, if anywhere, should investors look for returns after a tumultuous first half of the year…
02 Mar 2022 Fund Analysis
JMG is aimed at investors who want to maximise their outperformance over the long term…
08 Dec 2021 We are the (ESG) champions
Investment trusts tend to be amongst the best-performing ESG strategies in the combined open- and closed-ended universe…
26 May 2021 Fund Analysis
JMG has delivered exceptional long-term returns with a patient, high conviction approach…
20 Jan 2021 Kepler's top-rated investment trusts for 2021
We update our annual quantitative ratings for investment trusts…
11 Nov 2020 Fund Analysis
JMG has had another outstanding year despite the pandemic…
27 May 2020 Emerging markets, but not as you know them
We discuss the companies invested in by JPMorgan Emerging Markets Trust, which are keeping their developed market peers on their toes…
11 May 2020 The long run: experience is the key in volatile emerging markets
Coronavirus is just the latest in a series of crises that have hit emerging markets over the last two decades. Trusting a fund manager with experience of selecting stocks successfully through crises could be crucial in this unique sector…
11 May 2020 Fund Analysis
JMG’s patient, low-turnover approach has left it top of the performance tables…
29 Apr 2020 On solid ground
Our analysis of discounts highlights trusts which are likely to offer significantly less discount downside from the current level…
02 Sep 2019 The key to unlocking emerging markets
We discuss how the global resources of JPMorgan Asset Management have bolstered the performance of JPMorgan Emerging Markets Trust...
14 Aug 2019 Dangerous ground: the perils of market timing
Our research shows that attempting to time the market is, more often than not, a mug's game...
10 Jul 2019 Fund Analysis
JPMorgan Emerging Markets uses deep resources to identify companies with the potential to continue compounding earnings faster than the market...
08 Jan 2019 Discounts in focus: JPM Emerging Markets
Despite beating all of its peers over five years, and a highly experienced and well resourced manager, this trust continues to trade on a wide discount...
21 Dec 2018 Fund Analysis
The trust has been a consistent outperformer investing in volatile emerging markets...
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