JPMorgan US Smaller Companies (JUSC)

JPMorgan US Smaller Companies (JUSC) is a small- and mid-cap specialist investment trust with a long track record of investing in high quality small cap companies in the US. Over the last year, the US small-cap index has performed well, driven by a narrow band of about ten ‘AI-adjacent’ stocks that don’t fit the JUSC investment strategy due to concerns about lack of profitably and valuation. As a result, JUSC’s short-term underperformance has begun to impact on the longer-term performance figures. This shouldn’t, though, disguise JUSC’s longer record of outperformance, which we look at in the Performance section. JUSC’s management team argue that this has left the types of quality growth businesses they focus on back on some of the lowest relative and absolute valuations they have seen.

JUSC has been managed by Don San Jose since 2008. Don and his two experienced co-managers, Dan Percella and Jonathan Brachle use ‘quality growth’ as a starting point, and take a hands-on approach, meeting and visiting companies they invest in regularly. They are supported by a dedicated small-cap research team and manage c. US $5bn in similar strategies.

With an objective of capital growth, JUSC pays a single Dividend each year, and yields 0.8%. Gearing is currently 8%, slightly above the long-term average but well within policy limits. The Discount is currently 9%, and the board has made active use of buybacks in response. The board recently announced a revised fee structure, detailed in the Charges section, which could result in a lower ongoing charges figure.