Prospectus
J.P. Morgan
U.S. Equity Funds
Class A,
Class C, Class I & Class L* Shares
JPMorgan
Growth Advantage Fund
Class/Ticker:
A/VHIAX; C/JGACX; I/JGASX
JPMorgan
Mid Cap Equity Fund
Class/Ticker:
A/JCMAX; C/JMCCX; I/VSNGX
JPMorgan
Mid Cap Growth Fund
Class/Ticker:
A/OSGIX; C/OMGCX; I/HLGEX
JPMorgan
Mid Cap Value Fund
Class/Ticker:
A/JAMCX; C/JCMVX; I/JMVSX; L/FLMVX
JPMorgan
Small Cap Blend Fund
Class/Ticker:
A/VSCOX; C/VSCCX; I/JDSCX
JPMorgan
Small Cap Equity Fund
Class/Ticker:
A/VSEAX; C/JSECX; I/VSEIX
JPMorgan
Small Cap Growth Fund*
Class/Ticker:
A/PGSGX; C/OSGCX; I/OGGFX; L/JISGX
JPMorgan
Small Cap Value Fund
Class/Ticker:
A/PSOAX; C/OSVCX; I/PSOPX
JPMorgan
SMID Cap Equity Fund
Class/Ticker:
A/PECAX; C/ODMCX; I/WOOPX
JPMorgan
U.S. Small Company Fund
Class/Ticker:
A/JTUAX; C/JTUCX; I/JSCSX; L/JUSSX
JPMorgan
Value Advantage Fund
Class/Ticker:
A/JVAAX; C/JVACX; I/JVASX; L/JVAIX
*
Closed to new
investors.
The
Securities and Exchange Commission and the Commodity Futures Trading Commission
have not approved or disapproved of these securities or determined if this
prospectus is truthful or complete. Any representation to the contrary is a
criminal offense.
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Back
cover |
JPMorgan
Growth Advantage Fund
Class/Ticker:
A/VHIAX; C/JGACX; I/JGASX
What
is the goal of the Fund?
The Fund
seeks to provide long-term capital growth.
Fees
and Expenses of the Fund
The following
tables describe the fees and expenses that you may pay if you buy, hold and sell
shares of the Fund. You may pay other fees, such as brokerage commissions and
other fees to financial intermediaries, which are not reflected in the table and
examples below. You may
qualify for sales charge discounts on purchases
of Class A Shares if you and your family invest, or agree to invest in the
future, at least $50,000 in the J.P.
Morgan Funds. More
information about these and other discounts is available from your financial
intermediary and in “Investing with J.P. Morgan Funds — SALES CHARGES AND
FINANCIAL INTERMEDIARY COMPENSATION” on page 97
and in “Financial Intermediary-Specific Sales Charge Waivers” in Appendix A of
the prospectus and in “PURCHASES, REDEMPTIONS AND EXCHANGES” in Appendix A to
Part II of the Statement of Additional Information.
|
SHAREHOLDER
FEES (Fees
paid directly from your investment) | |||
|
|
Class
A |
Class
C |
Class
I |
|
Maximum
Sales Charge (Load)
Imposed
on Purchases, as % of
the
Offering Price |
5.25% |
NONE |
NONE |
|
Maximum
Deferred Sales Charge
(Load),
as % of Original Cost of
the
Shares |
NONE1
|
1.00% |
NONE |
1
For purchases
under $1 million.
|
ANNUAL
FUND OPERATING EXPENSES
(Expenses
that you pay each year as a percentage of the value
of
your investment) | |||
|
|
Class
A |
Class
C |
Class
I |
|
Management
Fees |
0.50% |
0.50% |
0.50% |
|
Distribution
(Rule 12b-1)
Fees |
0.25 |
0.75 |
NONE |
|
Other
Expenses |
0.33 |
0.34 |
0.33 |
|
Service
Fees |
0.25 |
0.25 |
0.25 |
|
Remainder
of Other
Expenses |
0.08 |
0.09 |
0.08 |
|
Total
Annual Fund Operat-
ing
Expenses |
1.08 |
1.59 |
0.83 |
|
Fee
Waivers and/or Expense
Reimbursements
1 |
-0.09 |
-0.10 |
-0.09 |
|
Total
Annual Fund Operat-
ing
Expenses after Fee
Waivers
and/or Expense
Reimbursements
1 |
0.99 |
1.49 |
0.74 |
1
The Fund’s
adviser and/or its affiliates have contractually agreed to waive fees and/or
reimburse expenses to the extent Total Annual Fund Operating
Expenses (excluding acquired
fund fees and expenses other than certain money market fund fees as described
below, dividend and interest expenses related to short sales, interest, taxes,
expenses related to litigation and potential litigation, expenses related to
trustee elections, and extraordinary expenses) exceed 0.99%, 1.49% and 0.74% of
the average daily net assets of Class A, Class C and Class I Shares,
respectively. The Fund may invest in one or more money market funds advised by
the adviser or its affiliates (affiliated money market funds). The Fund’s
adviser, shareholder servicing agent and/or administrator have contractually
agreed to waive fees and/or reimburse expenses in an amount sufficient to offset
the respective net fees each collects from the affiliated money market funds on
the Fund’s investment in such money market funds. These waivers are in effect
through 10/31/25, at which time it will be
determined whether such waivers will be renewed or revised. To the extent that
the Fund engages in securities lending, affiliated money market fund fees and
expenses resulting from the Fund’s investment of cash received from securities
lending borrowers are not included in Total Annual Fund Operating Expenses and
therefore, the above waivers do not apply to such investments.
Example
This Example is intended to
help you compare the cost of investing in the Fund with the cost of investing in
other mutual funds. The Example assumes that you invest $10,000 in the Fund for
the time periods indicated. The Example also assumes that your investment has a
5% return each year and that the Fund’s operating expenses are equal to the
total annual fund operating expenses after fee waivers and expense
reimbursements shown in the fee table through 10/31/25 and total annual fund
operating expenses thereafter. Your actual costs may be higher or
lower.
|
IF
YOU SELL YOUR SHARES, YOUR COST WOULD BE: | ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
A SHARES ($) |
621 |
842 |
1,081 |
1,765 |
|
CLASS
C SHARES ($) |
252 |
492 |
856 |
1,744 |
|
CLASS
I SHARES ($) |
76 |
256 |
452 |
1,017 |
|
IF
YOU DO NOT SELL YOUR SHARES, YOUR COST
WOULD
BE: | ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
A SHARES ($) |
621 |
842 |
1,081 |
1,765 |
|
CLASS
C SHARES ($) |
152 |
492 |
856 |
1,744 |
|
CLASS
I SHARES ($) |
76 |
256 |
452 |
1,017 |
Portfolio
Turnover
The Fund pays transaction
costs, such as commissions, when it buys and sells securities (or “turns over”
its portfolio). A higher portfolio turnover rate may indicate higher transaction
costs and may result in higher taxes when Fund shares are held in a taxable
account. These costs, which are not reflected in annual fund operating expenses
or in the Example, affect the Fund’s performance. During the Fund’s most recent
fiscal year, the Fund’s portfolio turnover rate was 28% of the average value of its
portfolio.
November
1, 2024 | 1
JPMorgan
Growth Advantage Fund
(continued)
What
are the Fund’s main investment strategies?
The Fund will
invest primarily in common stocks of companies across all market
capitalizations. The Fund may at any given time invest a significant portion of
its assets in companies of one particular market capitalization category, such
as large capitalization companies.
Derivatives,
which are instruments that have a value based on another instrument, exchange
rate or index, may be used as substitutes for securities in which the Fund can
invest. To the extent the Fund uses derivatives, the Fund will primarily use
futures contracts to more effectively gain targeted equity exposure from its
cash positions.
Investment
Process: The Fund invests in companies that the adviser believes have strong
earnings growth potential. In managing the Fund, the adviser employs a process
that combines research, valuation and stock selection to identify companies that
have a history of above-average growth or which the adviser believes will
achieve above-average growth in the future. Growth companies purchased for the
Fund include those with leading competitive positions that can achieve
sustainable growth. As part of its investment process, the adviser seeks to
assess the impact of environmental, social and governance (ESG) factors on many
issuers in the universe in which the Fund may invest. The adviser’s assessment
is based on an analysis of key opportunities and risks across industries to seek
to identify financially material issues with respect to the Fund’s investments
in securities and ascertain key issues that merit engagement with issuers. These
assessments may not be conclusive and securities of issuers that may be
negatively impacted by such factors may be purchased and retained by the Fund
while the Fund may divest or not invest in securities of issuers that may be
positively impacted by such factors.
The adviser
may sell a security for several reasons. A security may be sold due to a change
in the company’s fundamentals or if the adviser believes the security is no
longer attractively valued. Investments may also be sold if the adviser
identifies a stock that it believes offers a better investment
opportunity.
The
Fund’s Main Investment Risks
The Fund is
subject to management risk and may not achieve its objective if the adviser’s
expectations regarding particular instruments or markets are not
met.
An
investment in this Fund or any other fund may not provide a complete investment
program. The suitability of an investment in the Fund should be considered based
on the investment objective, strategies and risks described in this Prospectus,
considered in light of all of the other investments in your portfolio, as well
as your risk tolerance, financial goals and time horizons. You may want to
consult with a financial advisor to determine if this Fund is suitable for
you.
The Fund is
subject to the main risks noted below, any of which may adversely affect the
Fund’s performance and ability to meet its investment objective.
Equity
Market Risk. The price of
equity securities may rise or fall because of changes in the broad market or
changes in a company’s financial condition, sometimes rapidly or unpredictably.
These price movements may result from factors affecting individual companies,
sectors or industries selected for the Fund’s portfolio or the securities market
as a whole, such as changes in economic or political conditions. When the value
of the Fund’s portfolio securities goes down, your investment in the Fund
decreases in value.
General
Market Risk. Economies and
financial markets throughout the world are becoming increasingly interconnected,
which increases the likelihood that events or conditions in one country or
region will adversely impact markets or issuers in other countries or regions.
Securities in the Fund’s portfolio may underperform in comparison to securities
in general financial markets, a particular financial market or other asset
classes due to a number of factors, including inflation (or expectations for
inflation), deflation (or expectations for deflation), interest rates, global
demand for particular products or resources, market instability, financial
system instability, debt crises and downgrades, embargoes, tariffs, sanctions
and other trade barriers, regulatory events, other governmental trade or market
control programs and related geopolitical events. In addition, the value of the
Fund’s investments may be negatively affected by the occurrence of global events
such as war, terrorism, environmental disasters, natural disasters or events,
country instability, and infectious disease epidemics or
pandemics.
Growth
Investing Risk. Because
growth investing attempts to identify companies that the adviser believes will
experience rapid earnings growth relative to value or other types of stocks,
growth stocks may trade at higher multiples of current earnings compared to
value or other stocks, leading to inflated prices and thus potentially greater
declines in value.
Large
Cap Company Risk. Because the
Fund invests in large cap company securities, it may underperform other funds
during periods when the Fund’s large cap securities are out of
favor.
Smaller
Company Risk. Investments
in securities of smaller companies (mid cap and small cap companies) may be
riskier, less liquid, more volatile and more vulnerable to economic, market and
industry changes than securities of larger, more established companies. The
securities of smaller companies may trade less frequently and in smaller volumes
than securities of larger companies. As a result, changes in the price of
securities issued by such companies may be more sudden or erratic than the
prices of securities of large capitalization companies, especially over the
short term. These risks are higher for small cap companies.
2 | J.P.
Morgan U.S. Equity Funds
Derivatives
Risk. Derivatives, including
futures contracts, may be riskier than other types of investments and may
increase the volatility of the Fund. Derivatives may be sensitive to changes in
economic and market conditions and may create leverage, which could result in
losses that significantly exceed the Fund’s original investment. The Fund may be
more volatile than if the Fund had not been leveraged because the leverage tends
to exaggerate any effect on the value of the Fund’s portfolio securities.
Certain derivatives expose the Fund to counterparty risk, which is the risk that
the derivative counterparty will not fulfill its contractual obligations (and
includes credit risk associated with the counterparty). Certain derivatives are
synthetic instruments that attempt to replicate the performance of certain
reference assets. With regard to such derivatives, the Fund does not have a
claim on the reference assets and is subject to enhanced counterparty risk.
Derivatives may not perform as expected, so the Fund may not realize the
intended benefits. When used for hedging, the change in value of a derivative
may not correlate as expected with the security or other risk being hedged. In
addition, given their complexity, derivatives expose the Fund to risks of
mispricing or improper valuation. Derivatives also can expose the Fund to
derivative liquidity risk,
which includes
risks involving the liquidity demands that derivatives can create to make
payments of margin, collateral, or settlement payments to counterparties, legal
risk,
which includes
the risk of loss resulting from insufficient or unenforceable contractual
documentation, insufficient capacity or authority of the Fund’s counterparty and
operational risk, which includes documentation or settlement issues, system
failures, inadequate controls and human error.
Significant
Holdings Risk. Although
the Fund is considered “diversified” under applicable law, a relatively large
portion of its portfolio at times may be (and at the time of this filing, is)
invested in a relatively small number of securities. Significant investments in
a relatively small number of securities increases the risk that the value of the
Fund’s Shares is more sensitive to economic results of the companies issuing the
securities. The value of the shares of the Fund may also be more volatile than a
fund that allocates its investments to a larger number of smaller
positions.
Industry
and Sector Focus Risk. At times, the Fund may
increase the relative emphasis of its investments in a particular industry or
sector. The prices of securities of issuers in a particular industry or sector
may be more susceptible to fluctuations due to changes in economic or business
conditions, government regulations, availability of basic resources or supplies,
contagion risk within a particular industry or sector or to other industries or
sectors, or other events that affect that industry or sector more than
securities of issuers in other industries and sectors. To the extent that the
Fund increases the relative emphasis of its investments in a particular industry
or sector, the value of the Fund’s shares may fluctuate in response to events
affecting that industry or sector.
Technology
Sector Risk. Market or economic factors
impacting technology companies could have a major effect on the value of the
Fund’s investments. The value of stocks of technology companies is particularly
vulnerable to rapid changes in technology product cycles, rapid product
obsolescence and frequent new product introduction, unpredictable changes in
growth rates and competition for the services of qualified personnel, and
government regulation and competition, both domestically and internationally,
including competition from foreign competitors with lower production costs.
Stocks of technology companies, especially those of smaller, less-seasoned
companies, tend to be more volatile than the overall market. Technology
companies are heavily dependent on patent and intellectual property rights, the
loss or impairment of which may adversely affect profitability.
Transactions
Risk. The Fund
could experience a loss and its liquidity may be negatively impacted when
selling securities to meet redemption requests. The risk of loss increases if
the redemption requests are unusually large or frequent or occur in times of
overall market turmoil or declining prices. Similarly, large purchases of Fund
shares may adversely affect the Fund’s performance to the extent that the Fund
is delayed in investing new cash and is required to maintain a larger cash
position than it ordinarily would.
Investments
in the Fund are not deposits or obligations of, or guaranteed or endorsed by,
any bank and are not insured or guaranteed by the FDIC, the Federal Reserve
Board or any other government agency.
You could
lose money investing in the Fund.
The
Fund’s Past Performance
This section provides some
indication of the risks of investing in the Fund. The bar chart shows how the
performance of the Fund’s Class A Shares has
varied from year to year for the past ten calendar years. The table shows the
average annual total returns over the past one year, five years and ten years.
The table compares the Fund’s
performance to the performance of the Russell 3000®
Index and
Russell 3000® Growth Index. The Russell
3000® Index serves as the Fund’s
regulatory index and provides a broad measure of market performance. The Russell
3000® Growth Index is the Fund’s
additional index and is more representative of the Fund’s investment universe
than the regulatory index.
Past performance
(before and after taxes) is not necessarily an indication of how any class of
the Fund will perform in the future. Updated
performance information is available by visiting www.jpmorganfunds.com or by
calling 1-800-480-4111.
The
performance figures in the bar chart do not reflect any deduction for the
front-end sales load, which is assessed on Class A Shares. If the load were
reflected, the performance figures would have been lower.
November
1, 2024 | 3
JPMorgan
Growth Advantage Fund
(continued)
Frank
Russell Company is the source and owner of the Russell Index data contained or
reflected in this material and all trademarks and copyrights related thereto.
Frank Russell Company is not responsible for the formatting or configuration of
this material or for any inaccuracy in the adviser’s presentation
thereof.
|
YEAR-BY-YEAR
RETURNS — CLASS A SHARES |
|
Best
Quarter |
2nd
quarter, 2020 |
32.72% |
|
Worst
Quarter |
2nd
quarter, 2022 |
-22.13% |
|
The
Fund’s year-to-date total return |
through |
9/30/24 |
was |
24.05% |
. |
|
AVERAGE
ANNUAL TOTAL RETURNS
(For
periods ended December 31, 2023) | |||
|
|
Past
1
Year |
Past
5
Years |
Past
10
Years |
|
CLASS
A SHARES |
|
|
|
|
Return
Before Taxes |
32.47
% |
18.58
% |
14.12
% |
|
Return
After Taxes on Distributions |
32.27 |
16.56 |
12.59 |
|
Return
After Taxes on Distributions and
Sale
of Fund Shares |
19.37 |
14.73 |
11.43 |
|
CLASS
C SHARES |
|
|
|
|
Return
Before Taxes |
38.05 |
19.26 |
14.28 |
|
CLASS
I SHARES |
|
|
|
|
Return
Before Taxes |
40.16 |
20.16 |
14.99 |
|
RUSSELL
3000 INDEX1
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
25.96 |
15.16 |
11.48 |
|
RUSSELL
3000 GROWTH INDEX
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
41.21 |
18.85 |
14.33 |
1
As a result of new regulatory
requirements, the Fund's regulatory index has changed from the Russell 3000
Growth Index to the Russell 3000 Index.
After-tax
returns are shown only for the Class A Shares, and after-tax returns for the
other classes will vary.
After-tax
returns are calculated using the historical highest individual federal marginal
income tax rates and do not reflect the impact of state and local taxes.
Actual
after-tax returns depend on your tax situation
and may differ from those shown. The after-tax returns shown are not relevant to
investors who hold their shares through tax-deferred arrangements such as 401(k)
plans or individual retirement accounts.
Management
J.P. Morgan
Investment Management Inc. (the adviser)
|
Portfolio
Manager |
Managed
the
Fund
Since |
Primary
Title with
Investment
Adviser |
|
Felise
Agranoff |
2020 |
Managing
Director |
|
Larry
H. Lee |
2022 |
Managing
Director |
Purchase
and Sale of Fund Shares
Purchase
minimums
|
For
Class A and Class C Shares |
|
|
To
establish an account |
$1,000 |
|
To
add to an account |
$50 |
|
For
Class I Shares |
|
|
To
establish an account |
$1,000,000 |
|
To
add to an account |
No
minimum levels |
In general,
you may purchase or redeem shares on any business day:
●
Through your
Financial Intermediary
●
By writing to
J.P. Morgan Funds Services, P.O. Box 219143, Kansas City, MO
64121-9143
●
After you
open an account, by calling J.P. Morgan Funds Services at
1-800-480-4111
Tax
Information
The Fund
intends to make distributions that may be taxed as ordinary income or capital
gains, except when your investment is in an IRA, 401(k) plan or other
tax-advantaged investment plan, in which case you may be subject to federal
income tax upon withdrawal from the tax-advantaged investment
plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If you
purchase shares of the Fund through a broker-dealer or other financial
intermediary (such as a bank), the Fund and its related companies may pay the
financial intermediary for the sale of Fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
4 | J.P.
Morgan U.S. Equity Funds
financial
intermediary and your salesperson to recommend the Fund over another investment.
Ask your salesperson or visit your financial intermediary’s website for more
information.
November
1, 2024 | 5
JPMorgan
Mid Cap Equity Fund
|
| |||
|
|
Class
A |
Class
C |
Class
I |
|
Maximum
Sales Charge (Load)
Imposed
on Purchases, Shown as
%
of the Offering Price |
|
|
|
|
Maximum
Deferred Sales Charge
(Load),
as % of Original Cost of
the
Shares |
1
|
|
|
1
|
| |||
|
|
Class
A |
Class
C |
Class
I |
|
Management
Fees |
|
|
|
|
Distribution
(Rule 12b-1)
Fees |
|
|
|
|
Other
Expenses |
|
|
|
|
Service
Fees |
|
|
|
|
Remainder
of Other
Expenses |
|
|
|
|
Total
Annual Fund Operating
Expenses |
|
|
|
|
Fee
Waivers and/or Expense
Reimbursements
1 |
- |
- |
- |
|
Total
Annual Fund Operating
Expenses
after Fee Waivers
and/or
Expense Reimburse-
ments
1 |
|
|
|
1
|
| ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
A SHARES ($) |
|
|
|
|
|
CLASS
C SHARES ($) |
|
|
|
|
|
CLASS
I SHARES ($) |
|
|
|
|
|
| ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
A SHARES ($) |
|
|
|
|
|
CLASS
C SHARES ($) |
|
|
|
|
|
CLASS
I SHARES ($) |
|
|
|
|
6 | J.P.
Morgan U.S. Equity Funds
The Fund is
subject to management risk and may not achieve its objective if the adviser’s
expectations regarding particular instruments or markets are not
met.
An
investment in this Fund or any other fund may not provide a complete investment
program. The suitability of an investment in the Fund should be considered based
on the investment objective, strategies and risks described in this Prospectus,
considered in light of all of the other investments in your portfolio, as well
as your risk tolerance, financial goals and time horizons. You may want to
consult with a financial advisor to determine if this Fund is suitable for
you.
The Fund is
subject to the main risks noted below, any of which may adversely affect the
Fund’s performance and ability to meet its investment
objective.
November
1, 2024 | 7
JPMorgan
Mid Cap Equity Fund
(continued)
8 | J.P.
Morgan U.S. Equity Funds
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
|
Past
1
Year |
Past
5
Years |
Past
10
Years |
|
CLASS
I SHARES |
|
|
|
|
Return
Before Taxes |
% |
% |
% |
|
Return
After Taxes on Distributions |
|
|
|
|
Return
After Taxes on Distributions and
Sale
of Fund Shares |
|
|
|
|
CLASS
A SHARES |
|
|
|
|
Return
Before Taxes |
|
|
|
|
CLASS
C SHARES |
|
|
|
|
Return
Before Taxes |
|
|
|
|
RUSSELL
3000 INDEX1
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
|
|
|
|
RUSSELL
MIDCAP INDEX
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
|
|
|
1
Management
J.P. Morgan
Investment Management Inc. (the adviser)
|
Portfolio
Manager |
Managed
the
Fund
Since |
Primary
Title with
Investment
Adviser |
|
Jonathan
K.L. Simon* |
2002 |
Managing
Director |
|
Felise
Agranoff |
2020 |
Managing
Director |
|
Lawrence
E. Playford |
2020 |
Managing
Director |
|
Daniel
Bloomgarden |
2022 |
Managing
Director |
|
Ryan
N. Jones |
2024 |
Executive
Director |
|
Jeremy
C. Miller |
2024 |
Executive
Director |
*Mr. Simon will retire from
JPMIM effective early 2025. Until his retirement, Mr. Simon will continue to
serve on the portfolio management team and upon his retirement Messrs.
Bloomgarden, Playford,
Jones and Miller,
and Ms. Agranoff will continue to be responsible for the management of the
Fund.
Purchase
and Sale of Fund Shares
Purchase
minimums
|
For
Class A and Class C Shares |
|
|
To
establish an account |
$1,000 |
|
To
add to an account |
$50 |
|
For
Class I Shares |
|
|
To
establish an account |
$1,000,000 |
|
To
add to an account |
No
minimum levels |
In general,
you may purchase or redeem shares on any business day:
●
Through your
Financial Intermediary
●
By writing to
J.P. Morgan Funds Services, P.O. Box 219143, Kansas City, MO
64121-9143
●
After you
open an account, by calling J.P. Morgan Funds Services at
1-800-480-4111
Tax
Information
The Fund
intends to make distributions that may be taxed as ordinary income or capital
gains, except when your investment is in an IRA, 401(k) plan or other
tax-advantaged investment plan, in which case you may be subject to federal
income tax upon withdrawal from the tax-advantaged investment
plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If you
purchase shares of the Fund through a broker-dealer or other financial
intermediary (such as a bank), the Fund and its related companies may pay the
financial intermediary for the sale of Fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
financial intermediary and your salesperson to recommend the Fund over another
investment. Ask your salesperson or visit your financial intermediary’s website
for more information.
November
1, 2024 | 9
JPMorgan
Mid Cap Growth Fund
Class/Ticker:
A/OSGIX; C/OMGCX; I/HLGEX
What
is the goal of the Fund?
The Fund
seeks growth of capital.
Fees
and Expenses of the Fund
The following
tables describe the fees and expenses that you may pay if you buy, hold and sell
shares of the Fund. You may pay other fees, such as brokerage commissions and
other fees to financial intermediaries, which are not reflected in the table and
examples below. You may
qualify for sales charge discounts on purchases
of Class A Shares if you and your family invest, or agree to invest in the
future, at least $50,000 in the J.P.
Morgan Funds. More
information about these and other discounts is available from your financial
intermediary and in “Investing with J.P. Morgan Funds — SALES CHARGES AND
FINANCIAL INTERMEDIARY COMPENSATION” on page 97
and in “Financial Intermediary-Specific Sales Charge Waivers” in Appendix A of
the prospectus and in “PURCHASES, REDEMPTIONS AND EXCHANGES” in Appendix A to
Part II of the Statement of Additional Information.
|
SHAREHOLDER
FEES (Fees
paid directly from your investment) | |||
|
|
Class
A |
Class
C |
Class
I |
|
Maximum
Sales Charge (Load)
Imposed
on Purchases, as % of
the
Offering Price |
5.25% |
NONE |
NONE |
|
Maximum
Deferred Sales Charge
(Load),
as % of Original Cost of
the
Shares |
NONE1
|
1.00% |
NONE |
1
For purchases
under $1 million.
|
ANNUAL
FUND OPERATING EXPENSES
(Expenses
that you pay each year as a percentage of the value
of
your investment) | |||
|
|
Class
A |
Class
C |
Class
I |
|
Management
Fees |
0.60% |
0.60% |
0.60% |
|
Distribution
(Rule 12b-1)
Fees |
0.25 |
0.75 |
NONE |
|
Other
Expenses |
0.36 |
0.36 |
0.34 |
|
Service
Fees |
0.25 |
0.25 |
0.25 |
|
Remainder
of Other
Expenses |
0.11 |
0.11 |
0.09 |
|
Total
Annual Fund Operating
Expenses |
1.21 |
1.71 |
0.94 |
|
Fee
Waivers and/or Expense
Reimbursements
1 |
-0.12 |
-0.12 |
-0.10 |
|
Total
Annual Fund Operating
Expenses
after Fee Waivers
and/or
Expense Reimburse-
ments
1 |
1.09 |
1.59 |
0.84 |
1
The Fund’s
adviser and/or its affiliates have contractually agreed to waive fees and/or
reimburse expenses to the extent Total Annual Fund Operating
Expenses (excluding acquired
fund fees and expenses other than certain money market fund fees as described
below, dividend and interest expenses related to short sales, interest, taxes,
expenses related to litigation and potential litigation, expenses related to
trustee elections, and extraordinary expenses) exceed 1.09%, 1.59% and 0.84% of
the average daily net assets of Class A, Class C and Class I Shares,
respectively. The Fund may invest in one or more money market funds advised by
the adviser or its affiliates (affiliated money market funds). The Fund’s
adviser, shareholder servicing agent and/or administrator have contractually
agreed to waive fees and/or reimburse expenses in an amount sufficient to offset
the respective net fees each collects from the affiliated money market funds on
the Fund’s investment in such money market funds. These waivers are in effect
through 10/31/25, at which time it will be
determined whether such waivers will be renewed or revised. To the extent that
the Fund engages in securities lending, affiliated money market fund fees and
expenses resulting from the Fund’s investment of cash received from securities
lending borrowers are not included in Total Annual Fund Operating Expenses and
therefore, the above waivers do not apply to such investments.
Example
This Example is intended to
help you compare the cost of investing in the Fund with the cost of investing in
other mutual funds. The Example assumes that you invest $10,000 in the Fund for
the time periods indicated. The Example also assumes that your investment has a
5% return each year and that the Fund’s operating expenses are equal to the
total annual fund operating expenses after fee waivers and expense
reimbursements shown in the fee table through 10/31/25 and total annual fund
operating expenses thereafter. Your actual costs may be higher or
lower.
|
IF
YOU SELL YOUR SHARES, YOUR COST WOULD BE: | ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
A SHARES ($) |
630 |
878 |
1,144 |
1,904 |
|
CLASS
C SHARES ($) |
262 |
527 |
917 |
1,877 |
|
CLASS
I SHARES ($) |
86 |
290 |
510 |
1,146 |
|
IF
YOU DO NOT SELL YOUR SHARES, YOUR COST
WOULD
BE: | ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
A SHARES ($) |
630 |
878 |
1,144 |
1,904 |
|
CLASS
C SHARES ($) |
162 |
527 |
917 |
1,877 |
|
CLASS
I SHARES ($) |
86 |
290 |
510 |
1,146 |
Portfolio
Turnover
The Fund pays transaction
costs, such as commissions, when it buys and sells securities (or “turns over”
its portfolio). A higher portfolio turnover rate may indicate higher transaction
costs and may result in higher taxes when Fund shares are held in a taxable
account. These costs, which are not reflected in annual fund operating expenses
or in the Example, affect the Fund’s performance. During the Fund’s most recent
fiscal year, the Fund’s portfolio turnover rate was 55% of the average value of its
portfolio.
10 | J.P.
Morgan U.S. Equity Funds
What
are the Fund’s main investment strategies?
Under normal circumstances,
at least 80% of the Fund’s Assets will be invested in equity securities of mid
cap companies, including common stocks and debt securities and preferred
securities that are convertible to common stocks. “Assets” means net assets,
plus the amount of borrowings for investment purposes. In implementing its main
strategies, the Fund invests primarily in common stocks of mid cap companies
which the Fund’s adviser believes are capable of achieving sustained growth. Mid
cap companies are companies with market capitalizations similar to those within
the universe of the Russell Midcap®
Growth Index at
the time of purchase. As of the reconstitution of the Russell Midcap Growth
Index on September 30, 2024, the market capitalizations of the companies in the
index ranged from $57.58 million to $74.71 billion.
Derivatives,
which are instruments that have a value based on another instrument, exchange
rate or index, may be used as substitutes for securities in which the Fund can
invest. To the extent the Fund uses derivatives, the Fund will primarily use
futures contracts to more effectively gain targeted equity exposure from its
cash positions.
Investment
Process: In managing the Fund, the adviser employs a process that combines
research, valuation and stock selection to identify companies that have a
history of above-average growth or which the adviser believes will achieve
above-average growth in the future. Growth companies purchased for the Fund
include those with leading competitive positions that can achieve sustainable
growth. As part of its investment process, the adviser seeks to assess the
impact of environmental, social and governance (ESG) factors on many issuers in
the universe in which the Fund may invest. The adviser’s assessment is based on
an analysis of key opportunities and risks across industries to seek to identify
financially material issues with respect to the Fund’s investments in securities
and ascertain key issues that merit engagement with issuers. These assessments
may not be conclusive and securities of issuers that may be negatively impacted
by such factors may be purchased and retained by the Fund while the Fund may
divest or not invest in securities of issuers that may be positively impacted by
such factors.
The adviser
may sell a security for several reasons. A security may be sold due to a change
in the company’s fundamentals or if the adviser believes the security is no
longer attractively valued. Investments may also be sold if the adviser
identifies a stock that it believes offers a better investment
opportunity.
The
Fund’s Main Investment Risks
The Fund is
subject to management risk and may not achieve its objective if the adviser’s
expectations regarding particular instruments or markets are not
met.
An
investment in this Fund or any other fund may not provide a complete investment
program. The suitability of an investment in the Fund should be considered based
on the investment objective, strategies and risks described in this Prospectus,
considered in light of all of the other investments in your portfolio, as well
as your risk tolerance, financial goals and time horizons. You may want to
consult with a financial advisor to determine if this Fund is suitable for
you.
The Fund is
subject to the main risks noted below, any of which may adversely affect the
Fund’s performance and ability to meet its investment
objective.
Equity
Market Risk. The price of
equity securities may rise or fall because of changes in the broad market or
changes in a company’s financial condition, sometimes rapidly or unpredictably.
These price movements may result from factors affecting individual companies,
sectors or industries selected for the Fund’s portfolio or the securities market
as a whole, such as changes in economic or political conditions. When the value
of the Fund’s portfolio securities goes down, your investment in the Fund
decreases in value.
General
Market Risk. Economies and
financial markets throughout the world are becoming increasingly interconnected,
which increases the likelihood that events or conditions in one country or
region will adversely impact markets or issuers in other countries or regions.
Securities in the Fund’s portfolio may underperform in comparison to securities
in general financial markets, a particular financial market or other asset
classes due to a number of factors, including inflation (or expectations for
inflation), deflation (or expectations for deflation), interest rates, global
demand for particular products or resources, market instability, financial
system instability, debt crises and downgrades, embargoes, tariffs, sanctions
and other trade barriers, regulatory events, other governmental trade or market
control programs and related geopolitical events. In addition, the value of the
Fund’s investments may be negatively affected by the occurrence of global events
such as war, terrorism, environmental disasters, natural disasters or events,
country instability, and infectious disease epidemics or
pandemics.
Mid Cap
Company Risk.
Investments in mid cap companies may be riskier, less liquid, more volatile and
more vulnerable to economic, market and industry changes than investments in
larger, more established companies. The securities of smaller companies may
trade less frequently and in smaller volumes than securities of larger
companies. As a result, changes in the price of securities issued by such
companies may be more sudden or erratic than the prices of other equity
securities, especially over the short term.
Growth
Investing Risk. Because
growth investing attempts to identify companies that the adviser believes will
experience rapid earnings growth relative to value or other types of stocks,
November
1, 2024 | 11
JPMorgan
Mid Cap Growth Fund
(continued)
growth stocks
may trade at higher multiples of current earnings compared to value or other
stocks, leading to inflated prices and thus potentially greater declines in
value.
Derivatives
Risk. Derivatives, including
futures contracts, may be riskier than other types of investments and may
increase the volatility of the Fund. Derivatives may be sensitive to changes in
economic and market conditions and may create leverage, which could result in
losses that significantly exceed the Fund’s original investment. The Fund may be
more volatile than if the Fund had not been leveraged because the leverage tends
to exaggerate any effect on the value of the Fund’s portfolio securities.
Certain derivatives expose the Fund to counterparty risk, which is the risk that
the derivative counterparty will not fulfill its contractual obligations (and
includes credit risk associated with the counterparty). Certain derivatives are
synthetic instruments that attempt to replicate the performance of certain
reference assets. With regard to such derivatives, the Fund does not have a
claim on the reference assets and is subject to enhanced counterparty risk.
Derivatives may not perform as expected, so the Fund may not realize the
intended benefits. When used for hedging, the change in value of a derivative
may not correlate as expected with the security or other risk being hedged. In
addition, given their complexity, derivatives expose the Fund to risks of
mispricing or improper valuation. Derivatives also can expose the Fund to
derivative liquidity risk,
which includes
risks involving the liquidity demands that derivatives can create to make
payments of margin, collateral, or settlement payments to counterparties, legal
risk,
which includes
the risk of loss resulting from insufficient or unenforceable contractual
documentation, insufficient capacity or authority of the Fund’s counterparty and
operational risk, which includes documentation or settlement issues, system
failures, inadequate controls and human error.
Industry
and Sector Focus Risk. At times, the Fund may
increase the relative emphasis of its investments in a particular industry or
sector. The prices of securities of issuers in a particular industry or sector
may be more susceptible to fluctuations due to changes in economic or business
conditions, government regulations, availability of basic resources or supplies,
contagion risk within a particular industry or sector or to other industries or
sectors, or other events that affect that industry or sector more than
securities of issuers in other industries and sectors. To the extent that the
Fund increases the relative emphasis of its investments in a particular industry
or sector, the value of the Fund’s shares may fluctuate in response to events
affecting that industry or sector.
Healthcare
Sector Risk. Companies in
the healthcare sector are subject to extensive government regulation and their
profitability can be significantly affected by restrictions on government
reimbursement for medical expenses, rising costs of medical products and
services, pricing pressure (including price discounting), limited product lines
and an increased emphasis on the delivery of healthcare through outpatient
services. Companies in the healthcare sector are heavily dependent on
obtaining and
defending patents, which may be time consuming and costly, and the expiration of
patents may also adversely affect the profitability of these companies.
Healthcare companies are also subject to extensive litigation based on product
liability and similar claims. In addition, their products can become obsolete
due to industry innovation, changes in technologies or other market
developments. Many new products in the healthcare sector require significant
research and development and may be subject to regulatory approvals, all of
which may be time consuming and costly with no guarantee that any product will
come to market.
Industrials
Sector Risk. The
industrials sector may be adversely affected by changes in the supply of and
demand for products and services, product obsolescence, claims for environmental
damage or product liability and general economic conditions, among other
factors.
Technology
Sector Risk. Market or economic factors
impacting technology companies could have a major effect on the value of the
Fund’s investments. The value of stocks of technology companies is particularly
vulnerable to rapid changes in technology product cycles, rapid product
obsolescence and frequent new product introduction, unpredictable changes in
growth rates and competition for the services of qualified personnel, and
government regulation and competition, both domestically and internationally,
including competition from foreign competitors with lower production costs.
Stocks of technology companies, especially those of smaller, less-seasoned
companies, tend to be more volatile than the overall market. Technology
companies are heavily dependent on patent and intellectual property rights, the
loss or impairment of which may adversely affect
profitability.
Transactions
Risk. The Fund
could experience a loss and its liquidity may be negatively impacted when
selling securities to meet redemption requests. The risk of loss increases if
the redemption requests are unusually large or frequent or occur in times of
overall market turmoil or declining prices. Similarly, large purchases of Fund
shares may adversely affect the Fund’s performance to the extent that the Fund
is delayed in investing new cash and is required to maintain a larger cash
position than it ordinarily would.
Investments
in the Fund are not deposits or obligations of, or guaranteed or endorsed by,
any bank and are not insured or guaranteed by the FDIC, the Federal Reserve
Board or any other government agency.
You could
lose money investing in the Fund.
The
Fund’s Past Performance
This section
provides some indication of the risks of investing in the Fund. The bar chart
shows how the performance of the Fund’s Class
I Shares has varied from year to year for the past ten calendar years. The table
shows the average annual total returns over the past one year, five years and
ten years. The
12 | J.P.
Morgan U.S. Equity Funds
table compares the Fund’s
performance to the performance of the Russell 3000® Index and Russell
Midcap®
Growth Index.
The Russell 3000®
Index serves as
the Fund’s regulatory index and provides a broad measure of market performance.
The Russell Midcap®
Growth Index is
the Fund’s additional index and is more representative of the Fund’s investment
universe than the regulatory index.
Past performance
(before and after taxes) is not necessarily an indication of how any class of
the Fund will perform in the future. Updated
performance information is available by visiting www.jpmorganfunds.com or by
calling 1-800-480-4111.
Frank
Russell Company is the source and owner of the Russell Index data contained or
reflected in this material and all trademarks and copyrights related thereto.
Frank Russell Company is not responsible for the formatting or configuration of
this material or for any inaccuracy in the adviser’s presentation
thereof.
|
YEAR-BY-YEAR
RETURNS — CLASS I SHARES |
|
Best
Quarter |
2nd
quarter, 2020 |
32.44% |
|
Worst
Quarter |
2nd
quarter, 2022 |
-20.65% |
|
The
Fund’s year-to-date total return |
through |
9/30/24 |
was |
8.99% |
. |
|
AVERAGE
ANNUAL TOTAL RETURNS
(For
periods ended December 31, 2023) | |||
|
|
Past
1
Year |
Past
5
Years |
Past
10
Years |
|
CLASS
I SHARES |
|
|
|
|
Return
Before Taxes |
23.11
% |
15.54
% |
11.20
% |
|
Return
After Taxes on Distributions |
23.11 |
14.03 |
9.74 |
|
Return
After Taxes on Distributions and
Sale
of Fund Shares |
13.68 |
12.38 |
8.87 |
|
CLASS
A SHARES |
|
|
|
|
Return
Before Taxes |
16.38 |
13.98 |
10.28 |
|
CLASS
C SHARES |
|
|
|
|
Return
Before Taxes |
21.19 |
14.63 |
10.43 |
|
RUSSELL
3000 INDEX1
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
25.96 |
15.16 |
11.48 |
|
RUSSELL
MIDCAP GROWTH INDEX
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
25.87 |
13.81 |
10.57 |
1
As a result of new regulatory
requirements, the Fund's regulatory index has changed from the Russell Midcap
Growth Index to the Russell 3000 Index.
After-tax
returns are shown only for the Class I Shares, and after-tax returns for the
other classes will vary.
After-tax
returns are calculated using the historical highest individual federal marginal
income tax rates and do not reflect the impact of state and local taxes.
Actual
after-tax returns depend on your tax situation
and may differ from those shown. The after-tax returns shown are not relevant to
investors who hold their shares through tax-deferred arrangements such as 401(k)
plans or individual retirement accounts.
Management
J.P. Morgan
Investment Management Inc. (the adviser)
|
Portfolio
Manager |
Managed
the
Fund
Since |
Primary
Title with
Investment
Adviser |
|
Felise
Agranoff |
2015 |
Managing
Director |
|
Daniel
Bloomgarden |
2022 |
Managing
Director |
Purchase
and Sale of Fund Shares
Purchase
minimums
|
For
Class A and Class C Shares |
|
|
To
establish an account |
$1,000 |
|
To
add to an account |
$50 |
|
For
Class I Shares |
|
|
To
establish an account |
$1,000,000 |
|
To
add to an account |
No
minimum levels |
November
1, 2024 | 13
JPMorgan
Mid Cap Growth Fund
(continued)
In general,
you may purchase or redeem shares on any business day:
●
Through your
Financial Intermediary
●
By writing to
J.P. Morgan Funds Services, P.O. Box 219143, Kansas City, MO
64121-9143
●
After you
open an account, by calling J.P. Morgan Funds Services at
1-800-480-4111
Tax
Information
The Fund
intends to make distributions that may be taxed as ordinary income or capital
gains, except when your investment is in an IRA, 401(k) plan or other
tax-advantaged investment plan, in which case you may be subject to federal
income tax upon withdrawal from the tax-advantaged investment
plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If you
purchase shares of the Fund through a broker-dealer or other financial
intermediary (such as a bank), the Fund and its related companies may pay the
financial intermediary for the sale of Fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
financial intermediary and your salesperson to recommend the Fund over another
investment. Ask your salesperson or visit your financial intermediary’s website
for more information.
14 | J.P.
Morgan U.S. Equity Funds
JPMorgan
Mid Cap Value Fund
Class/Ticker:
A/JAMCX; C/JCMVX; I/JMVSX
What
is the goal of the Fund?
The Fund
seeks growth from capital appreciation.
Fees
and Expenses of the Fund
The following
tables describe the fees and expenses that you may pay if you buy, hold and sell
shares of the Fund. You may pay other fees, such as brokerage commissions and
other fees to financial intermediaries, which are not reflected in the table and
examples below. You may
qualify for sales charge discounts on purchases
of Class A Shares if you and your family invest, or agree to invest in the
future, at least $50,000 in the J.P.
Morgan Funds. More
information about these and other discounts is available from your financial
intermediary and in “Investing with J.P. Morgan Funds — SALES CHARGES AND
FINANCIAL INTERMEDIARY COMPENSATION” on page 97
and in “Financial Intermediary-Specific Sales Charge Waivers” in Appendix A of
the prospectus and in “PURCHASES, REDEMPTIONS AND EXCHANGES” in Appendix A to
Part II of the Statement of Additional Information.
|
SHAREHOLDER
FEES (Fees
paid directly from your investment) | |||
|
|
Class
A |
Class
C |
Class
I |
|
Maximum
Sales Charge (Load)
Imposed
on Purchases, as % of the
Offering
Price |
5.25% |
NONE |
NONE |
|
Maximum
Deferred Sales Charge
(Load),
as % of Original Cost of the
Shares |
NONE1
|
1.00% |
NONE |
1
For purchases
under $1 million.
|
ANNUAL
FUND OPERATING EXPENSES
(Expenses
that you pay each year as a percentage of the value
of
your investment) | |||
|
|
Class
A |
Class
C |
Class
I |
|
Management
Fees |
0.60% |
0.60% |
0.60% |
|
Distribution
(Rule 12b-1)
Fees |
0.25 |
0.75 |
NONE |
|
Other
Expenses |
0.34 |
0.35 |
0.34 |
|
Service
Fees |
0.25 |
0.25 |
0.25 |
|
Remainder
of Other
Expenses |
0.09 |
0.10 |
0.09 |
|
Total
Annual Fund Operating
Expenses |
1.19 |
1.70 |
0.94 |
|
Fee
Waivers and/or Expense
Reimbursements
1 |
-0.10 |
-0.11 |
-0.10 |
|
Total
Annual Fund Operating
Expenses
after Fee Waivers
and/or
Expense Reimburse-
ments
1 |
1.09 |
1.59 |
0.84 |
1
The Fund’s
adviser and/or its affiliates have contractually agreed to waive fees and/or
reimburse expenses to the extent Total Annual Fund Operating
Expenses (excluding acquired
fund fees and expenses other than certain money market fund fees as described
below, dividend and interest expenses related to short sales, interest, taxes,
expenses related to litigation and potential litigation, expenses related to
trustee elections, and extraordinary expenses) exceed 1.09%, 1.59% and 0.84% of
the average daily net assets of Class A, Class C and Class I Shares,
respectively. The Fund may invest in one or more money market funds advised by
the adviser or its affiliates (affiliated money market funds). The Fund’s
adviser, shareholder servicing agent and/or administrator have contractually
agreed to waive fees and/or reimburse expenses in an amount sufficient to offset
the respective net fees each collects from the affiliated money market funds on
the Fund’s investment in such money market funds. These waivers are in effect
through 10/31/25, at which time it will be
determined whether such waivers will be renewed or revised. To the extent that
the Fund engages in securities lending, affiliated money market fund fees and
expenses resulting from the Fund’s investment of cash received from securities
lending borrowers are not included in Total Annual Fund Operating Expenses and
therefore, the above waivers do not apply to such investments.
Example
This Example is intended to
help you compare the cost of investing in the Fund with the cost of investing in
other mutual funds. The Example assumes that you invest $10,000 in the Fund for
the time periods indicated. The Example also assumes that your investment has a
5% return each year and that the Fund’s operating expenses are equal to the
total annual fund operating expenses after fee waivers and expense
reimbursements shown in the fee table through 10/31/25 and total annual fund
operating expenses thereafter. Your actual costs may be higher or
lower.
|
IF
YOU SELL YOUR SHARES, YOUR COST WOULD BE: | ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
A SHARES ($) |
630 |
874 |
1,136 |
1,884 |
|
CLASS
C SHARES ($) |
262 |
525 |
913 |
1,864 |
|
CLASS
I SHARES ($) |
86 |
290 |
510 |
1,146 |
|
IF
YOU DO NOT SELL YOUR SHARES, YOUR COST
WOULD
BE: | ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
A SHARES ($) |
630 |
874 |
1,136 |
1,884 |
|
CLASS
C SHARES ($) |
162 |
525 |
913 |
1,864 |
|
CLASS
I SHARES ($) |
86 |
290 |
510 |
1,146 |
Portfolio
Turnover
The Fund pays transaction
costs, such as commissions, when it buys and sells securities (or “turns over”
its portfolio). A higher portfolio turnover rate may indicate higher transaction
costs and may result in higher taxes when Fund shares are held in a taxable
account. These costs, which are not reflected in annual fund operating expenses
or in the Example, affect the Fund’s performance. During the Fund’s most recent
fiscal year, the Fund’s portfolio turnover rate was 13% of the average value of its
portfolio.
November
1, 2024 | 15
JPMorgan
Mid Cap Value Fund
(continued)
What
are the Fund’s main investment strategies?
Under normal circumstances,
the Fund invests at least 80% of its Assets in equity securities of mid cap
companies. “Assets” means net assets, plus the amount of borrowings for
investment purposes. Mid cap companies are companies with market capitalizations
equal to those within the universe of the Russell Midcap® Value Index at the time of
purchase. As of the reconstitution of the Russell Midcap Value Index on
September 30, 2024, the market capitalizations of the companies in the index
ranged from $71.53 million to $62.27 billion. In implementing its main
strategies, the Fund’s investments are primarily in common stocks and real
estate investment trusts (REITs).
Derivatives,
which are instruments that have a value based on another instrument, exchange
rate or index, may be used as substitutes for securities in which the Fund can
invest. To the extent the Fund uses derivatives, the Fund will primarily use
futures contracts to more effectively gain targeted equity exposure from its
cash positions.
Investment
Process: In managing the Fund, the adviser employs a bottom-up approach to stock
selection, constructing portfolios based on company fundamentals, quantitative
screening and proprietary fundamental analysis. The adviser looks for quality
companies, which appear to be attractively valued and have the potential to grow
intrinsic value per share. Quality companies generally have a sustainable
competitive position, relatively lower levels of business cyclicality, high
returns on invested capital and strong experienced management teams. As part of
its investment process, the adviser seeks to assess the impact of environmental,
social and governance (ESG) factors on many issuers in the universe in which the
Fund may invest. The adviser’s assessment is based on an analysis of key
opportunities and risks across industries to seek to identify financially
material issues with respect to the Fund’s investments in securities and
ascertain key issues that merit engagement with issuers. These assessments may
not be conclusive and securities of issuers that may be negatively impacted by
such factors may be purchased and retained by the Fund while the Fund may divest
or not invest in securities of issuers that may be positively impacted by such
factors.
The adviser
may sell a security for several reasons. A security may be sold due to a change
in the company’s fundamentals or if the adviser believes the security is no
longer attractively valued. Investments may also be sold if the adviser
identifies a stock that it believes offers a better investment
opportunity.
The
Fund’s Main Investment Risks
The Fund is
subject to management risk and may not achieve its objective if the adviser’s
expectations regarding particular instruments or markets are not
met.
An
investment in this Fund or any other fund may not provide a complete investment
program. The suitability of an investment in the Fund should be considered based
on the investment objective, strategies and risks described in this Prospectus,
considered in light of all of the other investments in your portfolio, as well
as your risk tolerance, financial goals and time horizons. You may want to
consult with a financial advisor to determine if this Fund is suitable for
you.
The Fund is
subject to the main risks noted below, any of which may adversely affect the
Fund’s performance and ability to meet its investment
objective.
Equity
Market Risk. The price of
equity securities may rise or fall because of changes in the broad market or
changes in a company’s financial condition, sometimes rapidly or unpredictably.
These price movements may result from factors affecting individual companies,
sectors or industries selected for the Fund’s portfolio or the securities market
as a whole, such as changes in economic or political conditions. When the value
of the Fund’s portfolio securities goes down, your investment in the Fund
decreases in value.
General
Market Risk. Economies and
financial markets throughout the world are becoming increasingly interconnected,
which increases the likelihood that events or conditions in one country or
region will adversely impact markets or issuers in other countries or regions.
Securities in the Fund’s portfolio may underperform in comparison to securities
in general financial markets, a particular financial market or other asset
classes due to a number of factors, including inflation (or expectations for
inflation), deflation (or expectations for deflation), interest rates, global
demand for particular products or resources, market instability, financial
system instability, debt crises and downgrades, embargoes, tariffs, sanctions
and other trade barriers, regulatory events, other governmental trade or market
control programs and related geopolitical events. In addition, the value of the
Fund’s investments may be negatively affected by the occurrence of global events
such as war, terrorism, environmental disasters, natural disasters or events,
country instability, and infectious disease epidemics or
pandemics.
Mid Cap
Company Risk.
Investments in mid cap companies may be riskier, less liquid, more volatile and
more vulnerable to economic, market and industry changes than investments in
larger, more established companies. The securities of smaller companies may
trade less frequently and in smaller volumes than securities of larger
companies. As a result, changes in the price of securities issued by such
companies may be more sudden or erratic than the prices of other equity
securities, especially over the short term.
16 | J.P.
Morgan U.S. Equity Funds
Value
Investing Risk. A value
stock may decrease in price or may not increase in price as anticipated by the
adviser if other investors fail to recognize the company’s value or the factors
that the adviser believes will cause the stock price to increase do not
occur.
Derivatives
Risk. Derivatives, including
futures contracts, may be riskier than other types of investments and may
increase the volatility of the Fund. Derivatives may be sensitive to changes in
economic and market conditions and may create leverage, which could result in
losses that significantly exceed the Fund’s original investment. The Fund may be
more volatile than if the Fund had not been leveraged because the leverage tends
to exaggerate any effect on the value of the Fund’s portfolio securities.
Certain derivatives expose the Fund to counterparty risk, which is the risk that
the derivative counterparty will not fulfill its contractual obligations (and
includes credit risk associated with the counterparty). Certain derivatives are
synthetic instruments that attempt to replicate the performance of certain
reference assets. With regard to such derivatives, the Fund does not have a
claim on the reference assets and is subject to enhanced counterparty risk.
Derivatives may not perform as expected, so the Fund may not realize the
intended benefits. When used for hedging, the change in value of a derivative
may not correlate as expected with the security or other risk being hedged. In
addition, given their complexity, derivatives expose the Fund to risks of
mispricing or improper valuation. Derivatives also can expose the Fund to
derivative liquidity risk,
which includes
risks involving the liquidity demands that derivatives can create to make
payments of margin, collateral, or settlement payments to counterparties, legal
risk,
which includes
the risk of loss resulting from insufficient or unenforceable contractual
documentation, insufficient capacity or authority of the Fund’s counterparty and
operational risk, which includes documentation or settlement issues, system
failures, inadequate controls and human error.
Smaller
Company Risk. Investments
in smaller companies may be riskier, less liquid, more volatile and more
vulnerable to economic, market and industry changes than investments in larger,
more established companies. The securities of smaller companies may trade less
frequently and in smaller volumes than securities of larger companies. As a
result, the share price changes may be more sudden or erratic than the prices of
other securities, especially over the short term.
Real
Estate Securities Risk. The Fund’s
investments in real estate securities, including REITs, are subject to the same
risks as direct investments in real estate and mortgages, and their value will
depend on the value of the underlying real estate interests. These risks include
default, prepayments, changes in value resulting from changes in interest rates
and demand for real and rental property, and the management skill and
credit-worthiness of REIT issuers. The Fund will indirectly bear its
proportionate share of expenses, including management fees, paid by each REIT in
which it invests in addition to the expenses of the
Fund.
Industry
and Sector Focus Risk. At times, the Fund may
increase the relative emphasis of its investments in a particular industry or
sector. The prices of securities of issuers in a particular industry or sector
may be more susceptible to fluctuations due to changes in economic or business
conditions, government regulations, availability of basic resources or supplies,
contagion risk within a particular industry or sector or to other industries or
sectors, or other events that affect that industry or sector more than
securities of issuers in other industries and sectors. To the extent that the
Fund increases the relative emphasis of its investments in a particular industry
or sector, the value of the Fund’s shares may fluctuate in response to events
affecting that industry or sector.
Financials
Sector Risk. Financial
services companies are subject to extensive governmental regulation which may
limit both the amounts and types of loans and other financial commitments they
can make, the interest rates and fees they can charge, the scope of their
activities, the prices they can charge and the amount of capital they must
maintain. Profitability is largely dependent on the availability and cost of
capital funds and can fluctuate significantly when interest rates change or due
to increased competition. In addition, deterioration of the credit markets
generally may cause an adverse impact in a broad range of markets, including
U.S. and international credit and interbank money markets generally, thereby
affecting a wide range of financial institutions and markets. Certain events in
the financials sector may cause an unusually high degree of volatility in the
financial markets, both domestic and foreign, and cause certain financial
services companies to incur large losses. Securities of financial services
companies may experience a dramatic decline in value when such companies
experience substantial declines in the valuations of their assets, take action
to raise capital (such as the issuance of debt or equity securities), or cease
operations. Credit losses resulting from financial difficulties of borrowers and
financial losses associated with investment activities can negatively impact the
sector. Insurance companies may be subject to severe price competition. Adverse
economic, business or political developments could adversely affect financial
institutions engaged in mortgage finance or other lending or investing
activities directly or indirectly connected to the value of real
estate.
Industrials
Sector Risk. The
industrials sector may be adversely affected by changes in the supply of and
demand for products and services, product obsolescence, claims for environmental
damage or product liability and general economic conditions, among other
factors.
Transactions
Risk. The Fund
could experience a loss and its liquidity may be negatively impacted when
selling securities to meet redemption requests. The risk of loss increases if
the redemption requests are unusually large or frequent or occur in times of
overall market turmoil or declining prices. Similarly, large purchases of Fund
shares may adversely affect the Fund’s
November
1, 2024 | 17
JPMorgan
Mid Cap Value Fund
(continued)
performance
to the extent that the Fund is delayed in investing new cash and is required to
maintain a larger cash position than it ordinarily would.
Investments
in the Fund are not deposits or obligations of, or guaranteed or endorsed by,
any bank and are not insured or guaranteed by the FDIC, the Federal Reserve
Board or any other government agency.
You could
lose money investing in the Fund.
The
Fund’s Past Performance
This section provides some
indication of the risks of investing in the Fund. The bar chart shows how the
performance of the Fund’s Class A Shares has
varied from year to year for the past ten calendar years. The table shows the
average annual total returns over the past one year, five years and ten years.
The table compares the Fund’s
performance to the performance of the Russell 3000® Index and Russell
Midcap®
Value Index. The
Russell 3000®
Index serves as
the Fund’s regulatory index and provides a broad measure of market performance.
The Russell Midcap®
Value Index is
the Fund’s additional index and is more representative of the Fund’s investment
universe than the regulatory index.
Past performance
(before and after taxes) is not necessarily an indication of how any class of
the Fund will perform in the future. Updated
performance information is available by visiting www.jpmorganfunds.com or by
calling 1-800-480-4111.
The
performance figures in the bar chart do not reflect any deduction for the
front-end sales load, which is assessed on Class A Shares. If the load were
reflected, the performance figures would have been lower.
Frank
Russell Company is the source and owner of the Russell Index data contained or
reflected in this material and all trademarks and copyrights related thereto.
Frank Russell Company is not responsible for the formatting or configuration of
this material or for any inaccuracy in the adviser’s presentation
thereof.
|
YEAR-BY-YEAR
RETURNS — CLASS A SHARES |
|
Best
Quarter |
4th
quarter, 2020 |
19.23% |
|
Worst
Quarter |
1st
quarter, 2020 |
-31.90% |
|
The
Fund’s year-to-date total return |
through |
9/30/24 |
was |
14.38% |
. |
|
AVERAGE
ANNUAL TOTAL RETURNS
(For
periods ended December 31, 2023) | |||
|
|
Past
1
Year |
Past
5
Years |
Past
10
Years |
|
CLASS
A SHARES |
|
|
|
|
Return
Before Taxes |
5.03
% |
9.40
% |
7.07
% |
|
Return
After Taxes on Distributions |
3.59 |
7.24 |
5.26 |
|
Return
After Taxes on Distributions and
Sale
of Fund Shares |
3.97 |
7.25 |
5.38 |
|
CLASS
C SHARES |
|
|
|
|
Return
Before Taxes |
9.29 |
10.03 |
7.21 |
|
CLASS
I SHARES |
|
|
|
|
Return
Before Taxes |
11.13 |
10.86 |
7.91 |
|
RUSSELL
3000 INDEX1
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
25.96 |
15.16 |
11.48 |
|
RUSSELL
MIDCAP VALUE INDEX
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
12.71 |
11.16 |
8.26 |
1
As a result of new regulatory
requirements, the Fund's regulatory index has changed from the Russell Midcap
Value Index to the Russell 3000 Index.
After-tax
returns are shown only for the Class A Shares, and after-tax returns for the
other classes will vary.
After-tax
returns are calculated using the historical highest individual federal marginal
income tax rates and do not reflect the impact of state and local taxes.
Actual
after-tax returns depend on your tax situation
and may differ from those shown. The after-tax returns shown are not relevant to
investors who hold their shares through tax-deferred arrangements such as 401(k)
plans or individual retirement accounts.
18 | J.P.
Morgan U.S. Equity Funds
Management
J.P. Morgan
Investment Management Inc. (the adviser)
|
Portfolio
Manager |
Managed
the
Fund
Since |
Primary
Title with
Investment
Adviser |
|
Jonathan
K.L. Simon* |
1997 |
Managing
Director |
|
Lawrence
E. Playford |
2004 |
Managing
Director |
|
Ryan
N. Jones |
2024 |
Executive
Director |
|
Jeremy
C. Miller |
2024 |
Executive
Director |
*Mr. Simon will retire from
JPMIM effective early 2025. Until his retirement, Mr. Simon will continue to
serve on the portfolio management team and upon his retirement Messrs. Playford,
Jones and Miller will continue to be responsible for the management of the
Fund.
Purchase
and Sale of Fund Shares
Purchase
minimums
|
For
Class A and Class C Shares |
|
|
To
establish an account |
$1,000 |
|
To
add to an account |
$50 |
|
For
Class I Shares |
|
|
To
establish an account |
$1,000,000 |
|
To
add to an account |
No
minimum levels |
In general,
you may purchase or redeem shares on any business day:
●
Through your
Financial Intermediary
●
By writing to
J.P. Morgan Funds Services, P.O. Box 219143, Kansas City, MO
64121-9143
●
After you
open an account, by calling J.P. Morgan Funds Services at
1-800-480-4111
Tax
Information
The Fund
intends to make distributions that may be taxed as ordinary income or capital
gains, except when your investment is in an IRA, 401(k) plan or other
tax-advantaged investment plan, in which case you may be subject to federal
income tax upon withdrawal from the tax-advantaged investment
plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If you
purchase shares of the Fund through a broker-dealer or other financial
intermediary (such as a bank), the Fund and its related companies may pay the
financial intermediary for the sale of Fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
financial intermediary and your salesperson to recommend the Fund over another
investment. Ask your salesperson or visit your financial intermediary’s website
for more information.
November
1, 2024 | 19
JPMorgan
Mid Cap Value Fund
Class/Ticker:
L/FLMVX
Currently,
Class L Shares of the Fund are publicly offered only on a limited basis. (See
“Investing with J.P. Morgan Funds — FUNDS SUBJECT TO A LIMITED OFFERING” in the
prospectus for more information.)
What
is the goal of the Fund?
The Fund
seeks growth from capital appreciation.
Fees
and Expenses of the Fund
The following
table describes the fees and expenses that you may pay if you buy, hold and sell
shares of the Fund. You may pay other fees, such as brokerage commissions and
other fees to financial intermediaries, which are not reflected in the table and
examples below.
|
ANNUAL
FUND OPERATING EXPENSES
(Expenses
that you pay each year as a percentage of the value
of
your investment) | |
|
|
Class
L |
|
Management
Fees |
0.60% |
|
Distribution
(Rule 12b-1) Fees |
NONE |
|
Other
Expenses |
0.19 |
|
Service
Fees |
0.10 |
|
Remainder
of Other Expenses |
0.09 |
|
Total
Annual Fund Operating Expenses |
0.79 |
|
Fee
Waivers and/or Expense Reimbursements
1 |
-0.04 |
|
Total
Annual Fund Operating Expenses after Fee
Waivers
and/or Expense Reimbursements
1 |
0.75 |
1
The Fund’s adviser and/or its
affiliates have contractually agreed to waive fees and/or reimburse expenses to
the extent Total Annual Fund Operating Expenses (excluding acquired fund fees
and expenses other than certain money market fund fees as described below,
dividend and interest expenses related to short sales, interest, taxes, expenses
related to litigation and potential litigation, expenses related to trustee
elections, and extraordinary expenses) exceed 0.75% of the average daily net
assets of Class L Shares. The Fund may invest in one or more money market funds
advised by the adviser or its affiliates (affiliated money market funds). The
Fund’s adviser, shareholder servicing agent and/or administrator have
contractually agreed to waive fees and/or reimburse expenses in an amount
sufficient to offset the respective net fees each collects from the affiliated
money market funds on the Fund’s investment in such money market funds. These
waivers are in effect through 10/31/25, at which time it will be
determined whether such waivers will be renewed or revised. To the extent that
the Fund engages in securities lending, affiliated money market fund fees and
expenses resulting from the Fund’s investment of cash received from securities
lending borrowers are not included in Total Annual Fund Operating Expenses and
therefore, the above waivers do not apply to such
investments.
Example
This Example
is intended to help you compare the cost of investing in the Fund with the cost
of investing in other mutual funds. The Example assumes that you invest $10,000
in the Fund for the time periods indicated. The Example also assumes that your
investment has a 5% return each year and that the
Fund’s operating expenses are
equal to the total annual fund operating expenses after fee waivers and expense
reimbursements shown in the fee table through 10/31/25 and total annual fund
operating expenses thereafter. Your actual costs may be higher or
lower.
|
WHETHER
OR NOT YOU SELL YOUR SHARES, YOUR COST
WOULD
BE: | ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
L SHARES ($) |
77 |
248 |
435 |
974 |
Portfolio
Turnover
The Fund pays transaction
costs, such as commissions, when it buys and sells securities (or “turns over”
its portfolio). A higher portfolio turnover rate may indicate higher transaction
costs and may result in higher taxes when Fund shares are held in a taxable
account. These costs, which are not reflected in annual fund operating expenses
or in the Example, affect the Fund’s performance. During the Fund’s most recent
fiscal year, the Fund’s portfolio turnover rate was 13% of the average value of its
portfolio.
What
are the Fund’s main investment strategies?
Under normal circumstances,
the Fund invests at least 80% of its Assets in equity securities of mid cap
companies. “Assets” means net assets, plus the amount of borrowings for
investment purposes. Mid cap companies are companies with market capitalizations
equal to those within the universe of the Russell Midcap® Value Index at the time of
purchase. As of the reconstitution of the Russell Midcap Value Index on
September 30, 2024, the market capitalizations of the companies in the index
ranged from $71.53 million to $62.27 billion. In implementing its main
strategies, the Fund’s investments are primarily in common stocks and real
estate investment trusts (REITs).
Derivatives,
which are instruments that have a value based on another instrument, exchange
rate or index, may be used as substitutes for securities in which the Fund can
invest. To the extent the Fund uses derivatives, the Fund will primarily use
futures contracts to more effectively gain targeted equity exposure from its
cash positions.
Investment
Process: In managing the Fund, the adviser employs a bottom-up approach to stock
selection, constructing portfolios based on company fundamentals, quantitative
screening and proprietary fundamental analysis. The adviser looks for quality
companies, which appear to be attractively valued and have the potential to grow
intrinsic value per share. Quality companies generally have a sustainable
competitive position, relatively lower levels of business cyclicality, high
returns on invested capital and strong experienced management teams. As part of
its investment process, the adviser seeks to assess the impact of environmental,
social and governance (ESG) factors on many issuers in the universe in
20 | J.P.
Morgan U.S. Equity Funds
which the
Fund may invest. The adviser’s assessment is based on an analysis of key
opportunities and risks across industries to seek to identify financially
material issues with respect to the Fund’s investments in securities and
ascertain key issues that merit engagement with issuers. These assessments may
not be conclusive and securities of issuers that may be negatively impacted by
such factors may be purchased and retained by the Fund while the Fund may divest
or not invest in securities of issuers that may be positively impacted by such
factors.
The adviser
may sell a security for several reasons. A security may be sold due to a change
in the company’s fundamentals or if the adviser believes the security is no
longer attractively valued. Investments may also be sold if the adviser
identifies a stock that it believes offers a better investment
opportunity.
The
Fund’s Main Investment Risks
The Fund is
subject to management risk and may not achieve its objective if the adviser’s
expectations regarding particular instruments or markets are not
met.
An
investment in this Fund or any other fund may not provide a complete investment
program. The suitability of an investment in the Fund should be considered based
on the investment objective, strategies and risks described in this Prospectus,
considered in light of all of the other investments in your portfolio, as well
as your risk tolerance, financial goals and time horizons. You may want to
consult with a financial advisor to determine if this Fund is suitable for
you.
The Fund is
subject to the main risks noted below, any of which may adversely affect the
Fund’s performance and ability to meet its investment
objective.
Equity
Market Risk. The price of
equity securities may rise or fall because of changes in the broad market or
changes in a company’s financial condition, sometimes rapidly or unpredictably.
These price movements may result from factors affecting individual companies,
sectors or industries selected for the Fund’s portfolio or the securities market
as a whole, such as changes in economic or political conditions. When the value
of the Fund’s portfolio securities goes down, your investment in the Fund
decreases in value.
General
Market Risk. Economies and
financial markets throughout the world are becoming increasingly interconnected,
which increases the likelihood that events or conditions in one country or
region will adversely impact markets or issuers in other countries or regions.
Securities in the Fund’s portfolio may underperform in comparison to securities
in general financial markets, a particular financial market or other asset
classes due to a number of factors, including inflation (or expectations for
inflation), deflation (or expectations for deflation), interest rates, global
demand for particular products or resources, market instability, financial
system instability, debt crises and downgrades, embargoes, tariffs, sanctions
and other trade barriers, regulatory events, other governmental trade or
market
control programs and related geopolitical events. In addition, the value of the
Fund’s investments may be negatively affected by the occurrence of global events
such as war, terrorism, environmental disasters, natural disasters or events,
country instability, and infectious disease epidemics or pandemics.
Mid Cap
Company Risk.
Investments in mid cap companies may be riskier, less liquid, more volatile and
more vulnerable to economic, market and industry changes than investments in
larger, more established companies. The securities of smaller companies may
trade less frequently and in smaller volumes than securities of larger
companies. As a result, changes in the price of securities issued by such
companies may be more sudden or erratic than the prices of other equity
securities, especially over the short term.
Value
Investing Risk. A value
stock may decrease in price or may not increase in price as anticipated by the
adviser if other investors fail to recognize the company’s value or the factors
that the adviser believes will cause the stock price to increase do not
occur.
Derivatives
Risk. Derivatives, including
futures contracts, may be riskier than other types of investments and may
increase the volatility of the Fund. Derivatives may be sensitive to changes in
economic and market conditions and may create leverage, which could result in
losses that significantly exceed the Fund’s original investment. The Fund may be
more volatile than if the Fund had not been leveraged because the leverage tends
to exaggerate any effect on the value of the Fund’s portfolio securities.
Certain derivatives expose the Fund to counterparty risk, which is the risk that
the derivative counterparty will not fulfill its contractual obligations (and
includes credit risk associated with the counterparty). Certain derivatives are
synthetic instruments that attempt to replicate the performance of certain
reference assets. With regard to such derivatives, the Fund does not have a
claim on the reference assets and is subject to enhanced counterparty risk.
Derivatives may not perform as expected, so the Fund may not realize the
intended benefits. When used for hedging, the change in value of a derivative
may not correlate as expected with the security or other risk being hedged. In
addition, given their complexity, derivatives expose the Fund to risks of
mispricing or improper valuation. Derivatives also can expose the Fund to
derivative liquidity risk,
which includes
risks involving the liquidity demands that derivatives can create to make
payments of margin, collateral, or settlement payments to counterparties, legal
risk,
which includes
the risk of loss resulting from insufficient or unenforceable contractual
documentation, insufficient capacity or authority of the Fund’s counterparty and
operational risk, which includes documentation or settlement issues, system
failures, inadequate controls and human error.
Smaller
Company Risk. Investments
in smaller companies may be riskier, less liquid, more volatile and more
vulnerable to economic, market and industry changes than investments in larger,
more established companies. The securities of smaller
November
1, 2024 | 21
JPMorgan
Mid Cap Value Fund
(continued)
companies may
trade less frequently and in smaller volumes than securities of larger
companies. As a result, the share price changes may be more sudden or erratic
than the prices of other securities, especially over the short
term.
Real
Estate Securities Risk. The Fund’s
investments in real estate securities, including REITs, are subject to the same
risks as direct investments in real estate and mortgages, and their value will
depend on the value of the underlying real estate interests. These risks include
default, prepayments, changes in value resulting from changes in interest rates
and demand for real and rental property, and the management skill and
credit-worthiness of REIT issuers. The Fund will indirectly bear its
proportionate share of expenses, including management fees, paid by each REIT in
which it invests in addition to the expenses of the Fund.
Industry
and Sector Focus Risk. At times, the Fund may
increase the relative emphasis of its investments in a particular industry or
sector. The prices of securities of issuers in a particular industry or sector
may be more susceptible to fluctuations due to changes in economic or business
conditions, government regulations, availability of basic resources or supplies,
contagion risk within a particular industry or sector or to other industries or
sectors, or other events that affect that industry or sector more than
securities of issuers in other industries and sectors. To the extent that the
Fund increases the relative emphasis of its investments in a particular industry
or sector, the value of the Fund’s shares may fluctuate in response to events
affecting that industry or sector.
Financials
Sector Risk. Financial
services companies are subject to extensive governmental regulation which may
limit both the amounts and types of loans and other financial commitments they
can make, the interest rates and fees they can charge, the scope of their
activities, the prices they can charge and the amount of capital they must
maintain. Profitability is largely dependent on the availability and cost of
capital funds and can fluctuate significantly when interest rates change or due
to increased competition. In addition, deterioration of the credit markets
generally may cause an adverse impact in a broad range of markets, including
U.S. and international credit and interbank money markets generally, thereby
affecting a wide range of financial institutions and markets. Certain events in
the financials sector may cause an unusually high degree of volatility in the
financial markets, both domestic and foreign, and cause certain financial
services companies to incur large losses. Securities of financial services
companies may experience a dramatic decline in value when such companies
experience substantial declines in the valuations of their assets, take action
to raise capital (such as the issuance of debt or equity securities), or cease
operations. Credit losses resulting from financial difficulties of borrowers and
financial losses associated with investment activities can negatively impact the
sector. Insurance companies may be subject to severe price competition. Adverse
economic, business or political developments could
adversely
affect financial institutions engaged in mortgage finance or other lending or
investing activities directly or indirectly connected to the value of real
estate.
Industrials
Sector Risk. The
industrials sector may be adversely affected by changes in the supply of and
demand for products and services, product obsolescence, claims for environmental
damage or product liability and general economic conditions, among other
factors.
Transactions
Risk. The Fund
could experience a loss and its liquidity may be negatively impacted when
selling securities to meet redemption requests. The risk of loss increases if
the redemption requests are unusually large or frequent or occur in times of
overall market turmoil or declining prices. Similarly, large purchases of Fund
shares may adversely affect the Fund’s performance to the extent that the Fund
is delayed in investing new cash and is required to maintain a larger cash
position than it ordinarily would.
Investments
in the Fund are not deposits or obligations of, or guaranteed or endorsed by,
any bank and are not insured or guaranteed by the FDIC, the Federal Reserve
Board or any other government agency.
You could
lose money investing in the Fund.
The
Fund’s Past Performance
This section provides some
indication of the risks of investing in the Fund. The bar chart shows how the
performance of the Fund’s Class L Shares has
varied from year to year for the past ten calendar years. The table shows the
average annual total returns over the past one year, five years and ten years.
The table compares the Fund’s
performance to the performance of the Russell 3000® Index and Russell
Midcap®
Value Index. The
Russell 3000®
Index serves as
the Fund’s regulatory index and provides a broad measure of market performance.
The Russell Midcap®
Value Index is
the Fund’s additional index and is more representative of the Fund’s investment
universe than the regulatory index.
Past performance
(before and after taxes) is not necessarily an indication of how any class of
the Fund will perform in the future. Updated
performance information is available by visiting www.jpmorganfunds.com or by
calling 1-800-480-4111.
Frank
Russell Company is the source and owner of the Russell Index data contained or
reflected in this material and all trademarks and copyrights related thereto.
Frank Russell Company is not responsible for the formatting or configuration of
this material or for any inaccuracy in the adviser’s presentation
thereof.
22 | J.P.
Morgan U.S. Equity Funds
|
YEAR-BY-YEAR
RETURNS — CLASS L SHARES |
|
Best
Quarter |
4th
quarter, 2020 |
19.41% |
|
Worst
Quarter |
1st
quarter, 2020 |
-31.81% |
|
The
Fund’s year-to-date total return |
through |
9/30/24 |
was |
14.72% |
. |
|
AVERAGE
ANNUAL TOTAL RETURNS
(For
periods ended December 31, 2023) | |||
|
|
Past
1
Year |
Past
5
Years |
Past
10
Years |
|
CLASS
L SHARES |
|
|
|
|
Return
Before Taxes |
11.29
% |
11.08
% |
8.15
% |
|
Return
After Taxes on Distributions |
9.73 |
8.84 |
6.25 |
|
Return
After Taxes on Distributions and
Sale
of Fund Shares |
7.76 |
8.61 |
6.26 |
|
RUSSELL
3000 INDEX1
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
25.96 |
15.16 |
11.48 |
|
RUSSELL
MIDCAP VALUE INDEX
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
12.71 |
11.16 |
8.26 |
1
As a result of new regulatory
requirements, the Fund's regulatory index has changed from the Russell Midcap
Value Index to the Russell 3000 Index.
After-tax
returns are calculated using the historical highest individual federal marginal
income tax rates and do not reflect the impact of state and local taxes.
Actual
after-tax returns depend on
your tax situation and may differ from those shown. The after-tax returns shown
are not relevant to investors who hold their shares through tax-deferred
arrangements such as 401(k) plans or individual retirement
accounts.
Management
J.P. Morgan
Investment Management Inc. (the adviser)
|
Portfolio
Manager |
Managed
the
Fund
Since |
Primary
Title with
Investment
Adviser |
|
Jonathan
K.L. Simon* |
1997 |
Managing
Director |
|
Lawrence
E. Playford |
2004 |
Managing
Director |
|
Ryan
N. Jones |
2024 |
Executive
Director |
|
Jeremy
C. Miller |
2024 |
Executive
Director |
*Mr. Simon will retire from
JPMIM effective early 2025. Until his retirement, Mr. Simon will continue to
serve on the portfolio management team and upon his retirement Messrs. Playford,
Jones and Miller will continue to be responsible for the management of the
Fund.
Purchase
and Sale of Fund Shares
Class L
Shares of the Fund are no longer generally available to new purchasers. Existing
Class L shareholders can still purchase additional shares, reinvest their
dividends and exchange into the Class L Shares from Class L Shares of other J.P.
Morgan Funds. In addition, certain group employer benefit plans, certain
fee-based advisory programs, college savings plans and other J.P. Morgan Funds
can continue to purchase shares as described in “Investing with J.P. Morgan
Funds — FUNDS SUBJECT TO A LIMITED OFFERING” in the
prospectus.
Purchase
minimums
|
For
Class L Shares |
|
|
To
establish an account |
$3,000,000 |
|
To
add to an account |
No
minimum levels |
In general,
you may purchase or redeem shares on any business day:
●
Through your
Financial Intermediary
●
By writing to
J.P. Morgan Funds Services, P.O. Box 219143, Kansas City, MO
64121-9143
●
After you
open an account, by calling J.P. Morgan Funds Services at
1-800-480-4111
Tax
Information
The Fund
intends to make distributions that may be taxed as ordinary income or capital
gains, except when your investment is in an IRA, 401(k) plan or other
tax-advantaged investment plan, in which case you may be subject to federal
income tax upon withdrawal from the tax-advantaged investment
plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If you
purchase shares of the Fund through a broker-dealer or other financial
intermediary (such as a bank), the Fund and its related companies may pay the
financial intermediary for the sale of Fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
November
1, 2024 | 23
JPMorgan
Mid Cap Value Fund
(continued)
financial
intermediary and your salesperson to recommend the Fund over another investment.
Ask your salesperson or visit your financial intermediary’s website for more
information.
24 | J.P.
Morgan U.S. Equity Funds
JPMorgan
Small Cap Blend Fund
|
| |||
|
|
Class
A |
Class
C |
Class
I |
|
Maximum
Sales Charge (Load)
Imposed
on Purchases, as % of
the
Offering Price |
|
|
|
|
Maximum
Deferred Sales Charge
(Load),
as % of Original Cost of
the
Shares |
1
|
|
|
1
|
| |||
|
|
Class
A |
Class
C |
Class
I |
|
Management
Fees |
|
|
|
|
Distribution
(Rule 12b-1)
Fees |
|
|
|
|
Other
Expenses |
|
|
|
|
Service
Fees |
|
|
|
|
Remainder
of Other
Expenses |
|
|
|
|
Total
Annual Fund Operating
Expenses |
|
|
|
|
Fee
Waivers and/or Expense
Reimbursements
1 |
- |
- |
- |
|
Total
Annual Fund Operating
Expenses
after Fee Waivers
and/or
Expense Reimburse-
ments
1 |
|
|
|
1
|
| ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
A SHARES ($) |
|
|
|
|
|
CLASS
C SHARES ($) |
|
|
|
|
|
CLASS
I SHARES ($) |
|
|
|
|
|
| ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
A SHARES ($) |
|
|
|
|
|
CLASS
C SHARES ($) |
|
|
|
|
|
CLASS
I SHARES ($) |
|
|
|
|
November
1, 2024 | 25
JPMorgan
Small Cap Blend Fund
(continued)
The Fund is
subject to management risk and may not achieve its objective if the adviser’s
expectations regarding particular instruments or markets are not
met.
An
investment in this Fund or any other fund may not provide a complete investment
program. The suitability of an investment in the Fund should be considered based
on the investment objective, strategies and risks described in this Prospectus,
considered in light of all of the other investments in your portfolio, as well
as your risk tolerance, financial goals and time horizons. You may want to
consult with a financial advisor to determine if this Fund is suitable for
you.
The Fund is
subject to the main risks noted below, any of which may adversely affect the
Fund’s performance and ability to meet its investment
objective.
26 | J.P.
Morgan U.S. Equity Funds
November
1, 2024 | 27
JPMorgan
Small Cap Blend Fund
(continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
|
Past
1
Year |
Past
5
Years |
Past
10
Years |
|
CLASS
A SHARES |
|
|
|
|
Return
Before Taxes |
% |
% |
% |
|
Return
After Taxes on Distributions |
|
|
|
|
Return
After Taxes on Distributions and
Sale
of Fund Shares |
|
|
|
|
CLASS
C SHARES |
|
|
|
|
Return
Before Taxes |
|
|
|
|
CLASS
I SHARES |
|
|
|
|
Return
Before Taxes |
|
|
|
|
RUSSELL
3000 INDEX1
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
|
|
|
|
RUSSELL
2000 INDEX
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
|
|
|
28 | J.P.
Morgan U.S. Equity Funds
1
Management
J.P. Morgan
Investment Management Inc. (the adviser)
|
Portfolio
Manager |
Managed
the
Fund
Since |
Primary
Title with
Investment
Adviser |
|
Eytan
Shapiro |
2004 |
Managing
Director |
|
Lawrence
E. Playford |
2018 |
Managing
Director |
Purchase
and Sale of Fund Shares
Purchase
minimums
|
For
Class A and Class C Shares |
|
|
To
establish an account |
$1,000 |
|
To
add to an account |
$50 |
|
For
Class I Shares |
|
|
To
establish an account |
$1,000,000 |
|
To
add to an account |
No
minimum levels |
In general,
you may purchase or redeem shares on any business day:
●
Through your
Financial Intermediary
●
By writing to
J.P. Morgan Funds Services, P.O. Box 219143, Kansas City, MO
64121-9143
●
After you
open an account, by calling J.P. Morgan Funds Services at
1-800-480-4111
Tax
Information
The Fund
intends to make distributions that may be taxed as ordinary income or capital
gains, except when your investment is in an IRA, 401(k) plan or other
tax-advantaged investment plan, in which case you may be subject to federal
income tax upon withdrawal from the tax-advantaged investment
plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If you
purchase shares of the Fund through a broker-dealer or other financial
intermediary (such as a bank), the Fund and its related companies may pay the
financial intermediary for the sale of Fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
financial intermediary and your salesperson to recommend the Fund over another
investment. Ask your salesperson or visit your financial intermediary’s website
for more information.
November
1, 2024 | 29
JPMorgan
Small Cap Equity Fund
|
| |||
|
|
Class
A |
Class
C |
Class
I |
|
Maximum
Sales Charge (Load)
Imposed
on Purchases, as % of
the
Offering Price |
|
|
|
|
Maximum
Deferred Sales Charge
(Load),
as % of Original Cost of
the
Shares |
1
|
|
|
1
|
| |||
|
|
Class
A |
Class
C |
Class
I |
|
Management
Fees |
|
|
|
|
Distribution
(Rule 12b-1)
Fees |
|
|
|
|
Other
Expenses |
|
|
|
|
Service
Fees |
|
|
|
|
Remainder
of Other
Expenses |
|
|
|
|
Total
Annual Fund Operating
Expenses |
|
|
|
|
Fee
Waivers and/or Expense
Reimbursements
1 |
|
|
- |
|
Total
Annual Fund Operating
Expenses
after Fee Waivers
and/or
Expense Reimburse-
ments
1 |
|
|
|
1
|
| ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
A SHARES ($) |
|
|
|
|
|
CLASS
C SHARES ($) |
|
|
|
|
|
CLASS
I SHARES ($) |
|
|
|
|
|
| ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
A SHARES ($) |
|
|
|
|
|
CLASS
C SHARES ($) |
|
|
|
|
|
CLASS
I SHARES ($) |
|
|
|
|
30 | J.P.
Morgan U.S. Equity Funds
The Fund is
subject to management risk and may not achieve its objective if the adviser’s
expectations regarding particular instruments or markets are not
met.
An
investment in this Fund or any other fund may not provide a complete investment
program. The suitability of an investment in the Fund should be considered based
on the investment objective, strategies and risks described in this Prospectus,
considered in light of all of the other investments in your portfolio, as well
as your risk tolerance, financial goals and time horizons. You may want to
consult with a financial advisor to determine if this Fund is suitable for
you.
The Fund is
subject to the main risks noted below, any of which may adversely affect the
Fund’s performance and ability to meet its investment objective.
November
1, 2024 | 31
JPMorgan
Small Cap Equity Fund
(continued)
32 | J.P.
Morgan U.S. Equity Funds
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
|
Past
1
Year |
Past
5
Years |
Past
10
Years |
|
CLASS
A SHARES |
|
|
|
|
Return
Before Taxes |
% |
% |
% |
|
Return
After Taxes on Distributions |
|
|
|
|
Return
After Taxes on Distributions and
Sale
of Fund Shares |
|
|
|
|
CLASS
C SHARES |
|
|
|
|
Return
Before Taxes |
|
|
|
|
CLASS
I SHARES |
|
|
|
|
Return
Before Taxes |
|
|
|
|
RUSSELL
3000 INDEX1
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
|
|
|
|
RUSSELL
2000 INDEX
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
|
|
|
1
Management
J.P. Morgan
Investment Management Inc. (the adviser)
|
Portfolio
Manager |
Managed
the
Fund
Since |
Primary
Title with
Investment
Adviser |
|
Don
San Jose |
2007 |
Managing
Director |
|
Daniel
J. Percella |
2014 |
Managing
Director |
Purchase
and Sale of Fund Shares
Purchase
minimums
|
For
Class A and Class C Shares |
|
|
To
establish an account |
$1,000 |
|
To
add to an account |
$50 |
|
For
Class I Shares |
|
|
To
establish an account |
$1,000,000 |
|
To
add to an account |
No
minimum levels |
In general,
you may purchase or redeem shares on any business day:
●
Through your
Financial Intermediary
●
By writing to
J.P. Morgan Funds Services, P.O. Box 219143, Kansas City, MO
64121-9143
●
After you
open an account, by calling J.P. Morgan Funds Services at
1-800-480-4111
Tax
Information
The Fund
intends to make distributions that may be taxed as ordinary income or capital
gains, except when your investment is in an IRA, 401(k) plan or other
tax-advantaged investment plan, in which case you may be subject to federal
income tax upon withdrawal from the tax-advantaged investment
plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If you
purchase shares of the Fund through a broker-dealer or other financial
intermediary (such as a bank), the Fund and its related companies may pay the
financial intermediary for the sale of Fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
financial intermediary and your salesperson to recommend the Fund over another
investment. Ask your salesperson or visit your financial intermediary’s website
for more information.
November
1, 2024 | 33
JPMorgan
Small Cap Growth Fund
Class/Ticker:
A/PGSGX; C/OSGCX; I/OGGFX
Currently,
the Fund is publicly offered on a limited basis. (See “Investing with J.P.
Morgan Funds — FUNDS SUBJECT TO A LIMITED OFFERING” in the prospectus for more
information.)
What
is the goal of the Fund?
The Fund
seeks long-term capital growth primarily by investing in a portfolio of equity
securities of small-capitalization and emerging growth
companies.
Fees
and Expenses of the Fund
The following
tables describe the fees and expenses that you may pay if you buy, hold and sell
shares of the Fund. You may pay other fees, such as brokerage commissions and
other fees to financial intermediaries, which are not reflected in the table and
examples below. You may
qualify for sales charge discounts on purchases
of Class A Shares if you and your family invest, or agree to invest in the
future, at least $50,000 in the J.P.
Morgan Funds. More
information about these and other discounts is available from your financial
intermediary and in “Investing with J.P. Morgan Funds — SALES CHARGES AND
FINANCIAL INTERMEDIARY COMPENSATION” on page 97
and in “Financial Intermediary-Specific Sales Charge Waivers” in Appendix A of
the prospectus and in “PURCHASES, REDEMPTIONS AND EXCHANGES” in Appendix A to
Part II of the Statement of Additional Information.
|
SHAREHOLDER
FEES (Fees
paid directly from your investment) | |||
|
|
Class
A |
Class
C |
Class
I |
|
Maximum
Sales Charge (Load)
Imposed
on Purchases, as % of the
Offering
Price |
5.25% |
NONE |
NONE |
|
Maximum
Deferred Sales Charge
(Load),
as % of Original Cost of the
Shares |
NONE1
|
1.00% |
NONE |
1
For purchases
under $1 million.
|
ANNUAL
FUND OPERATING EXPENSES
(Expenses
that you pay each year as a percentage of the value
of
your investment) | |||
|
|
Class
A |
Class
C |
Class
I |
|
Management
Fees |
0.65% |
0.65% |
0.65% |
|
Distribution
(Rule 12b-1)
Fees |
0.25 |
0.75 |
NONE |
|
Other
Expenses |
0.36 |
0.36 |
0.35 |
|
Service
Fees |
0.25 |
0.25 |
0.25 |
|
Remainder
of Other
Expenses |
0.11 |
0.11 |
0.10 |
|
Total
Annual Fund Operating
Expenses |
1.26 |
1.76 |
1.00 |
|
Fee
Waivers and/or Expense
Reimbursements
1 |
-0.02 |
-0.02 |
-0.01 |
|
Total
Annual Fund Operating
Expenses
after Fee Waivers
and/or
Expense Reimburse-
ments
1 |
1.24 |
1.74 |
0.99 |
1
The Fund’s adviser and/or its
affiliates have contractually agreed to waive fees and/or reimburse expenses to
the extent Total Annual Fund Operating Expenses (excluding acquired fund fees
and expenses other than certain money market fund fees as described below,
dividend and interest expenses related to short sales, interest, taxes, expenses
related to litigation and potential litigation, expenses related to trustee
elections, and extraordinary expenses) exceed 1.24%, 1.74% and 0.99% of the
average daily net assets of Class A, Class C and Class I Shares, respectively.
The Fund may invest in one or more money market funds advised by the adviser or
its affiliates (affiliated money market funds). The Fund’s adviser, shareholder
servicing agent and/or administrator have contractually agreed to waive fees
and/or reimburse expenses in an amount sufficient to offset the respective net
fees each collects from the affiliated money market funds on the Fund’s
investment in such money market funds. These waivers are in effect through
10/31/25, at which time it will be
determined whether such waivers will be renewed or revised. To the extent that
the Fund engages in securities lending, affiliated money market fund fees and
expenses resulting from the Fund’s investment of cash received from securities
lending borrowers are not included in Total Annual Fund Operating Expenses and
therefore, the above waivers do not apply to such
investments.
Example
This Example is intended to
help you compare the cost of investing in the Fund with the cost of investing in
other mutual funds. The Example assumes that you invest $10,000 in the Fund for
the time periods indicated. The Example also assumes that your investment has a
5% return each year and that the Fund’s operating expenses are equal to the
total annual fund operating expenses after fee waivers and expense
reimbursements shown in the fee table through 10/31/25 and total annual fund
operating expenses thereafter. Your actual costs may be higher or
lower.
34 | J.P.
Morgan U.S. Equity Funds
|
IF
YOU SELL YOUR SHARES, YOUR COST WOULD BE: | ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
A SHARES ($) |
645 |
902 |
1,178 |
1,966 |
|
CLASS
C SHARES ($) |
277 |
552 |
952 |
1,940 |
|
CLASS
I SHARES ($) |
101 |
317 |
551 |
1,224 |
|
IF
YOU DO NOT SELL YOUR SHARES, YOUR COST
WOULD
BE: | ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
A SHARES ($) |
645 |
902 |
1,178 |
1,966 |
|
CLASS
C SHARES ($) |
177 |
552 |
952 |
1,940 |
|
CLASS
I SHARES ($) |
101 |
317 |
551 |
1,224 |
Portfolio
Turnover
The Fund pays transaction
costs, such as commissions, when it buys and sells securities (or “turns over”
its portfolio). A higher portfolio turnover rate may indicate higher transaction
costs and may result in higher taxes when Fund shares are held in a taxable
account. These costs, which are not reflected in annual fund operating expenses
or in the Example, affect the Fund’s performance. During the Fund’s most recent
fiscal year, the Fund’s portfolio turnover rate was 43% of the average value of its
portfolio.
What
are the Fund’s main investment strategies?
Under normal circumstances,
at least 80% of the Fund’s Assets will be invested in the securities of small
capitalization companies. “Assets” means net assets, plus the amount of
borrowings for investment purposes. Small cap companies are companies with
market capitalizations equal to those within the universe of the Russell
2000® Growth Index stocks at the
time of purchase. As of the reconstitution of the Russell 2000 Growth Index on
September 30, 2024, the market capitalizations of the companies in the index
ranged from $1.19 million to $13.51 billion. In implementing its main
strategies, the Fund will invest primarily in common stocks. Typically, the Fund
invests in securities of companies with a history of above-average growth, as
well as companies expected to have above-average growth.
Derivatives,
which are instruments that have a value based on another instrument, exchange
rate or index, may be used as substitutes for securities in which the Fund can
invest. To the extent the Fund uses derivatives, the Fund will primarily use
futures contracts to more effectively gain targeted equity exposure from its
cash positions.
Investment
Process: In managing the Fund, the adviser employs a process that combines
research, valuation and stock selection to identify companies that have a
history of above-average growth or which the adviser believes will achieve
above-average growth in the future. Growth companies purchased for the Fund
include those with leading competitive positions that
can achieve
sustainable growth. As part of its investment process, the adviser seeks to
assess the impact of environmental, social and governance (ESG) factors on many
issuers in the universe in which the Fund may invest. The adviser’s assessment
is based on an analysis of key opportunities and risks across industries to seek
to identify financially material issues with respect to the Fund’s investments
in securities and ascertain key issues that merit engagement with issuers. These
assessments may not be conclusive and securities of issuers that may be
negatively impacted by such factors may be purchased and retained by the Fund
while the Fund may divest or not invest in securities of issuers that may be
positively impacted by such factors.
The adviser
may sell a security for several reasons. A security may be sold due to a change
in the company’s fundamentals or if the adviser believes the security is no
longer attractively valued. Investments may also be sold if the adviser
identifies a stock that it believes offers a better investment
opportunity.
The
Fund’s Main Investment Risks
The Fund is
subject to management risk and may not achieve its objective if the adviser’s
expectations regarding particular instruments or markets are not
met.
An
investment in this Fund or any other fund may not provide a complete investment
program. The suitability of an investment in the Fund should be considered based
on the investment objective, strategies and risks described in this Prospectus,
considered in light of all of the other investments in your portfolio, as well
as your risk tolerance, financial goals and time horizons. You may want to
consult with a financial advisor to determine if this Fund is suitable for
you.
The Fund is
subject to the main risks noted below, any of which may adversely affect the
Fund’s performance and ability to meet its investment
objective.
Equity
Market Risk. The price of
equity securities may rise or fall because of changes in the broad market or
changes in a company’s financial condition, sometimes rapidly or unpredictably.
These price movements may result from factors affecting individual companies,
sectors or industries selected for the Fund’s portfolio or the securities market
as a whole, such as changes in economic or political conditions. When the value
of the Fund’s portfolio securities goes down, your investment in the Fund
decreases in value.
General
Market Risk. Economies and
financial markets throughout the world are becoming increasingly interconnected,
which increases the likelihood that events or conditions in one country or
region will adversely impact markets or issuers in other countries or regions.
Securities in the Fund’s portfolio may underperform in comparison to securities
in general financial markets, a particular financial market or other asset
classes due to a number of factors, including inflation (or
November
1, 2024 | 35
JPMorgan
Small Cap Growth Fund
(continued)
expectations
for inflation), deflation (or expectations for deflation), interest rates,
global demand for particular products or resources, market instability,
financial system instability, debt crises and downgrades, embargoes, tariffs,
sanctions and other trade barriers, regulatory events, other governmental trade
or market control programs and related geopolitical events. In addition, the
value of the Fund’s investments may be negatively affected by the occurrence of
global events such as war, terrorism, environmental disasters, natural disasters
or events, country instability, and infectious disease epidemics or
pandemics.
Smaller
Company Risk. Investments
in smaller companies may be riskier, less liquid, more volatile and more
vulnerable to economic, market and industry changes than investments in larger,
more established companies. The securities of smaller companies may trade less
frequently and in smaller volumes than securities of larger companies. As a
result, the share price changes may be more sudden or erratic than the prices of
other securities, especially over the short term.
Growth
Investing Risk. Because
growth investing attempts to identify companies that the adviser believes will
experience rapid earnings growth relative to value or other types of stocks,
growth stocks may trade at higher multiples of current earnings compared to
value or other stocks, leading to inflated prices and thus potentially greater
declines in value.
Derivatives
Risk. Derivatives, including
futures contracts, may be riskier than other types of investments and may
increase the volatility of the Fund. Derivatives may be sensitive to changes in
economic and market conditions and may create leverage, which could result in
losses that significantly exceed the Fund’s original investment. The Fund may be
more volatile than if the Fund had not been leveraged because the leverage tends
to exaggerate any effect on the value of the Fund’s portfolio securities.
Certain derivatives expose the Fund to counterparty risk, which is the risk that
the derivative counterparty will not fulfill its contractual obligations (and
includes credit risk associated with the counterparty). Certain derivatives are
synthetic instruments that attempt to replicate the performance of certain
reference assets. With regard to such derivatives, the Fund does not have a
claim on the reference assets and is subject to enhanced counterparty risk.
Derivatives may not perform as expected, so the Fund may not realize the
intended benefits. When used for hedging, the change in value of a derivative
may not correlate as expected with the security or other risk being hedged. In
addition, given their complexity, derivatives expose the Fund to risks of
mispricing or improper valuation. Derivatives also can expose the Fund to
derivative liquidity risk,
which includes
risks involving the liquidity demands that derivatives can create to make
payments of margin, collateral, or settlement payments to counterparties, legal
risk,
which includes
the risk of loss resulting from insufficient or unenforceable contractual
documentation, insufficient
capacity or authority of the
Fund’s counterparty and operational risk, which includes documentation or
settlement issues, system failures, inadequate controls and human
error.
Industry
and Sector Focus Risk. At times, the Fund may
increase the relative emphasis of its investments in a particular industry or
sector. The prices of securities of issuers in a particular industry or sector
may be more susceptible to fluctuations due to changes in economic or business
conditions, government regulations, availability of basic resources or supplies,
contagion risk within a particular industry or sector or to other industries or
sectors, or other events that affect that industry or sector more than
securities of issuers in other industries and sectors. To the extent that the
Fund increases the relative emphasis of its investments in a particular industry
or sector, the value of the Fund’s shares may fluctuate in response to events
affecting that industry or sector.
Healthcare
Sector Risk. Companies in
the healthcare sector are subject to extensive government regulation and their
profitability can be significantly affected by restrictions on government
reimbursement for medical expenses, rising costs of medical products and
services, pricing pressure (including price discounting), limited product lines
and an increased emphasis on the delivery of healthcare through outpatient
services. Companies in the healthcare sector are heavily dependent on obtaining
and defending patents, which may be time consuming and costly, and the
expiration of patents may also adversely affect the profitability of these
companies. Healthcare companies are also subject to extensive litigation based
on product liability and similar claims. In addition, their products can become
obsolete due to industry innovation, changes in technologies or other market
developments. Many new products in the healthcare sector require significant
research and development and may be subject to regulatory approvals, all of
which may be time consuming and costly with no guarantee that any product will
come to market.
Industrials
Sector Risk. The
industrials sector may be adversely affected by changes in the supply of and
demand for products and services, product obsolescence, claims for environmental
damage or product liability and general economic conditions, among other
factors.
Technology
Sector Risk. Market or economic factors
impacting technology companies could have a major effect on the value of the
Fund’s investments. The value of stocks of technology companies is particularly
vulnerable to rapid changes in technology product cycles, rapid product
obsolescence and frequent new product introduction, unpredictable changes in
growth rates and competition for the services of qualified personnel, and
government regulation and competition, both domestically and internationally,
including competition from foreign competitors with lower production costs.
Stocks of technology companies, especially those of smaller, less-seasoned
companies, tend to be more volatile than the overall
36 | J.P.
Morgan U.S. Equity Funds
market. Technology companies
are heavily dependent on patent and intellectual property rights, the loss or
impairment of which may adversely affect profitability.
Transactions
Risk. The Fund
could experience a loss and its liquidity may be negatively impacted when
selling securities to meet redemption requests. The risk of loss increases if
the redemption requests are unusually large or frequent or occur in times of
overall market turmoil or declining prices. Similarly, large purchases of Fund
shares may adversely affect the Fund’s performance to the extent that the Fund
is delayed in investing new cash and is required to maintain a larger cash
position than it ordinarily would.
Investments
in the Fund are not deposits or obligations of, or guaranteed or endorsed by,
any bank and are not insured or guaranteed by the FDIC, the Federal Reserve
Board or any other government agency.
You could
lose money investing in the Fund.
The
Fund’s Past Performance
This section provides some
indication of the risks of investing in the Fund. The bar chart shows how the
performance of the Fund’s Class A Shares has
varied from year to year for the past ten calendar years. The table shows the
average annual total returns over the past one year, five years and ten years.
The table compares the Fund’s
performance to the performance of the Russell 3000® Index and Russell
2000® Growth Index. The Russell
3000® Index serves as the Fund’s
regulatory index and provides a broad measure of market performance. The Russell
2000® Growth Index is the Fund’s
additional index and is more representative of the Fund’s investment universe
than the regulatory index.
Past performance
(before and after taxes) is not necessarily an indication of how any class of
the Fund will perform in the future. Updated
performance information is available by visiting www.jpmorganfunds.com or by
calling 1-800-480-4111.
The
performance figures in the bar chart do not reflect any deduction for the
front-end sales load, which is assessed on Class A Shares. If the load were
reflected, the performance figures would have been lower.
Frank
Russell Company is the source and owner of the Russell Index data contained or
reflected in this material and all trademarks and copyrights related thereto.
Frank Russell Company is not responsible for the formatting or configuration of
this material or for any inaccuracy in the adviser’s presentation
thereof.
|
YEAR-BY-YEAR
RETURNS — CLASS A SHARES |
|
Best
Quarter |
2nd
quarter, 2020 |
37.40% |
|
Worst
Quarter |
2nd
quarter, 2022 |
-21.93% |
|
The
Fund’s year-to-date total return |
through |
9/30/24 |
was |
10.66% |
. |
|
AVERAGE
ANNUAL TOTAL RETURNS
(For
periods ended December 31, 2023) | |||
|
|
Past
1
Year |
Past
5
Years |
Past
10
Years |
|
CLASS
A SHARES |
|
|
|
|
Return
Before Taxes |
7.89
% |
8.37
% |
7.77
% |
|
Return
After Taxes on Distributions |
7.89 |
6.81 |
5.92 |
|
Return
After Taxes on Distributions and
Sale
of Fund Shares |
4.67 |
6.65 |
5.92 |
|
CLASS
C SHARES |
|
|
|
|
Return
Before Taxes |
12.29 |
9.01 |
7.91 |
|
CLASS
I SHARES |
|
|
|
|
Return
Before Taxes |
14.17 |
9.83 |
8.62 |
|
RUSSELL
3000 INDEX1
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
25.96 |
15.16 |
11.48 |
|
RUSSELL
2000 GROWTH INDEX
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
18.66 |
9.22 |
7.16 |
1
As a result of new regulatory
requirements, the Fund's regulatory index has changed from the Russell 2000
Growth Index to the Russell 3000 Index.
After-tax
returns are shown only for the Class A Shares, and after-tax returns for the
other classes will vary.
After-tax
returns are calculated using the historical highest individual federal marginal
income tax rates and do not reflect the impact of state and local taxes.
Actual
after-tax returns depend on your tax situation
and may differ from those shown. The after-tax returns shown are not relevant to
investors who hold their shares through tax-deferred arrangements such as 401(k)
plans or individual retirement accounts.
November
1, 2024 | 37
JPMorgan
Small Cap Growth Fund
(continued)
Management
J.P. Morgan
Investment Management Inc. (the adviser)
|
Portfolio
Manager |
Managed
the
Fund
Since |
Primary
Title with
Investment
Adviser |
|
Eytan
Shapiro |
2004 |
Managing
Director |
|
Matthew
Cohen |
2016 |
Managing
Director |
|
Philip
D. Hart |
2023 |
Managing
Director |
|
Michael
Stein |
2023 |
Executive
Director |
Matthew Cohen, M.D. has
announced his retirement from J.P. Morgan Investment Management Inc. in the
spring of 2025. Dr. Cohen will continue to serve on the portfolio management
team of the Fund until his retirement, and upon his retirement the current
portfolio managers, Eytan Shapiro, Phillip D. Hart and Michael Stein will assume
full authority of the day-to-day management of the Fund. Mr. Shapiro will
continue as the lead portfolio manager on the Fund.
Purchase
and Sale of Fund Shares
Purchase
minimums
|
For
Class A and Class C Shares |
|
|
To
establish an account |
$1,000 |
|
To
add to an account |
$50 |
|
For
Class I Shares |
|
|
To
establish an account |
$1,000,000 |
|
To
add to an account |
No
minimum levels |
In general,
you may purchase or redeem shares on any business day:
●
Through your
Financial Intermediary
●
By writing to
J.P. Morgan Funds Services, P.O. Box 219143, Kansas City, MO
64121-9143
●
After you
open an account, by calling J.P. Morgan Funds Services at
1-800-480-4111
Tax
Information
The Fund
intends to make distributions that may be taxed as ordinary income or capital
gains, except when your investment is in an IRA, 401(k) plan or other
tax-advantaged investment plan, in which case you may be subject to federal
income tax upon withdrawal from the tax-advantaged investment
plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If you
purchase shares of the Fund through a broker-dealer or other financial
intermediary (such as a bank), the Fund and its related companies may pay the
financial intermediary for the sale of Fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
financial intermediary and your salesperson to recommend the Fund over another
investment. Ask your salesperson or visit your financial intermediary’s website
for more information.
38 | J.P.
Morgan U.S. Equity Funds
JPMorgan
Small Cap Growth Fund
Class/Ticker:
L/JISGX
Currently,
the Fund (including Class L Shares) is publicly offered on a limited basis. (See
“Investing with J.P. Morgan Funds — FUNDS SUBJECT TO A LIMITED OFFERING” in the
prospectus for more information.)
What
is the goal of the Fund?
The Fund
seeks long-term capital growth primarily by investing in a portfolio of equity
securities of small-capitalization and emerging growth
companies.
Fees
and Expenses of the Fund
The following
table describes the fees and expenses that you may pay if you buy, hold and sell
shares of the Fund. You may pay other fees, such as brokerage commissions and
other fees to financial intermediaries, which are not reflected in the table and
examples below.
|
ANNUAL
FUND OPERATING EXPENSES
(Expenses
that you pay each year as a percentage of the value
of
your investment) | |
|
|
Class
L |
|
Management
Fees |
0.65% |
|
Distribution
(Rule 12b-1) Fees |
NONE |
|
Other
Expenses |
0.20 |
|
Service
Fees |
0.10 |
|
Remainder
of Other Expenses |
0.10 |
|
Total
Annual Fund Operating Expenses |
0.85 |
Example
This Example
is intended to help you compare the cost of investing in the Fund with the cost
of investing in other mutual funds. The Example assumes that you invest $10,000
in the Fund for the time periods indicated. The Example also assumes that your
investment has a 5% return each year and that the Fund’s operating expenses
remain the same. Your actual costs may be higher or lower.
|
WHETHER
OR NOT YOU SELL YOUR SHARES, YOUR COST
WOULD
BE: | ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
L SHARES ($) |
87 |
271 |
471 |
1,049 |
Portfolio
Turnover
The Fund pays
transaction costs, such as commissions, when it buys and sells securities (or
“turns over” its portfolio). A higher portfolio turnover rate may indicate
higher transaction costs and may result in higher taxes when Fund shares are
held in a taxable account. These costs, which are not reflected in annual fund
operating expenses or in the Example, affect the Fund’s
performance. During the
Fund’s most recent fiscal year, the Fund’s portfolio turnover rate was
43% of the average value of its
portfolio.
What
are the Fund’s main investment strategies?
Under normal circumstances,
at least 80% of the Fund’s Assets will be invested in the securities of small
capitalization companies. “Assets” means net assets, plus the amount of
borrowings for investment purposes. Small cap companies are companies with
market capitalizations equal to those within the universe of the Russell
2000® Growth Index stocks at the
time of purchase. As of the reconstitution of the Russell 2000 Growth Index on
September 30, 2024, the market capitalizations of the companies in the index
ranged from $1.19 million to $13.51 billion. In implementing its main
strategies, the Fund will invest primarily in common stocks. Typically, the Fund
invests in securities of companies with a history of above-average growth, as
well as companies expected to have above-average growth.
Derivatives,
which are instruments that have a value based on another instrument, exchange
rate or index, may be used as substitutes for securities in which the Fund can
invest. To the extent the Fund uses derivatives, the Fund will primarily use
futures contracts to more effectively gain targeted equity exposure from its
cash positions.
Investment
Process: In managing the Fund, the adviser employs a process that combines
research, valuation and stock selection to identify companies that have a
history of above-average growth or which the adviser believes will achieve
above-average growth in the future. Growth companies purchased for the Fund
include those with leading competitive positions that can achieve sustainable
growth. As part of its investment process, the adviser seeks to assess the
impact of environmental, social and governance (ESG) factors on many issuers in
the universe in which the Fund may invest. The adviser’s assessment is based on
an analysis of key opportunities and risks across industries to seek to identify
financially material issues with respect to the Fund’s investments in securities
and ascertain key issues that merit engagement with issuers. These assessments
may not be conclusive and securities of issuers that may be negatively impacted
by such factors may be purchased and retained by the Fund while the Fund may
divest or not invest in securities of issuers that may be positively impacted by
such factors.
The adviser
may sell a security for several reasons. A security may be sold due to a change
in the company’s fundamentals or if the adviser believes the security is no
longer attractively valued. Investments may also be sold if the adviser
identifies a stock that it believes offers a better investment
opportunity.
The
Fund’s Main Investment Risks
The Fund is
subject to management risk and may not achieve its objective if the adviser’s
expectations regarding particular instruments or markets are not
met.
November
1, 2024 | 39
JPMorgan
Small Cap Growth Fund
(continued)
An
investment in this Fund or any other fund may not provide a complete investment
program. The suitability of an investment in the Fund should be considered based
on the investment objective, strategies and risks described in this Prospectus,
considered in light of all of the other investments in your portfolio, as well
as your risk tolerance, financial goals and time horizons. You may want to
consult with a financial advisor to determine if this Fund is suitable for
you.
The Fund is
subject to the main risks noted below, any of which may adversely affect the
Fund’s performance and ability to meet its investment
objective.
Equity
Market Risk. The price of
equity securities may rise or fall because of changes in the broad market or
changes in a company’s financial condition, sometimes rapidly or unpredictably.
These price movements may result from factors affecting individual companies,
sectors or industries selected for the Fund’s portfolio or the securities market
as a whole, such as changes in economic or political conditions. When the value
of the Fund’s portfolio securities goes down, your investment in the Fund
decreases in value.
General
Market Risk. Economies and
financial markets throughout the world are becoming increasingly interconnected,
which increases the likelihood that events or conditions in one country or
region will adversely impact markets or issuers in other countries or regions.
Securities in the Fund’s portfolio may underperform in comparison to securities
in general financial markets, a particular financial market or other asset
classes due to a number of factors, including inflation (or expectations for
inflation), deflation (or expectations for deflation), interest rates, global
demand for particular products or resources, market instability, financial
system instability, debt crises and downgrades, embargoes, tariffs, sanctions
and other trade barriers, regulatory events, other governmental trade or market
control programs and related geopolitical events. In addition, the value of the
Fund’s investments may be negatively affected by the occurrence of global events
such as war, terrorism, environmental disasters, natural disasters or events,
country instability, and infectious disease epidemics or
pandemics.
Smaller
Company Risk. Investments
in smaller companies may be riskier, less liquid, more volatile and more
vulnerable to economic, market and industry changes than investments in larger,
more established companies. The securities of smaller companies may trade less
frequently and in smaller volumes than securities of larger companies. As a
result, the share price changes may be more sudden or erratic than the prices of
other securities, especially over the short term.
Growth
Investing Risk. Because
growth investing attempts to identify companies that the adviser believes will
experience rapid earnings growth relative to value or other types of stocks,
growth stocks
may trade at higher multiples of current earnings compared to value or other
stocks, leading to inflated prices and thus potentially greater declines in
value.
Derivatives
Risk. Derivatives, including
futures contracts, may be riskier than other types of investments and may
increase the volatility of the Fund. Derivatives may be sensitive to changes in
economic and market conditions and may create leverage, which could result in
losses that significantly exceed the Fund’s original investment. The Fund may be
more volatile than if the Fund had not been leveraged because the leverage tends
to exaggerate any effect on the value of the Fund’s portfolio securities.
Certain derivatives expose the Fund to counterparty risk, which is the risk that
the derivative counterparty will not fulfill its contractual obligations (and
includes credit risk associated with the counterparty). Certain derivatives are
synthetic instruments that attempt to replicate the performance of certain
reference assets. With regard to such derivatives, the Fund does not have a
claim on the reference assets and is subject to enhanced counterparty risk.
Derivatives may not perform as expected, so the Fund may not realize the
intended benefits. When used for hedging, the change in value of a derivative
may not correlate as expected with the security or other risk being hedged. In
addition, given their complexity, derivatives expose the Fund to risks of
mispricing or improper valuation. Derivatives also can expose the Fund to
derivative liquidity risk,
which includes
risks involving the liquidity demands that derivatives can create to make
payments of margin, collateral, or settlement payments to counterparties, legal
risk,
which includes
the risk of loss resulting from insufficient or unenforceable contractual
documentation, insufficient capacity or authority of the Fund’s counterparty and
operational risk, which includes documentation or settlement issues, system
failures, inadequate controls and human error.
Industry
and Sector Focus Risk. At times, the Fund may
increase the relative emphasis of its investments in a particular industry or
sector. The prices of securities of issuers in a particular industry or sector
may be more susceptible to fluctuations due to changes in economic or business
conditions, government regulations, availability of basic resources or supplies,
contagion risk within a particular industry or sector or to other industries or
sectors, or other events that affect that industry or sector more than
securities of issuers in other industries and sectors. To the extent that the
Fund increases the relative emphasis of its investments in a particular industry
or sector, the value of the Fund’s shares may fluctuate in response to events
affecting that industry or sector.
Healthcare
Sector Risk. Companies in
the healthcare sector are subject to extensive government regulation and their
profitability can be significantly affected by restrictions on government
reimbursement for medical expenses, rising costs of medical products and
services, pricing pressure (including price discounting), limited product lines
and an increased emphasis on the delivery of healthcare through outpatient
services. Companies in the healthcare sector are heavily dependent on
40 | J.P.
Morgan U.S. Equity Funds
obtaining and
defending patents, which may be time consuming and costly, and the expiration of
patents may also adversely affect the profitability of these companies.
Healthcare companies are also subject to extensive litigation based on product
liability and similar claims. In addition, their products can become obsolete
due to industry innovation, changes in technologies or other market
developments. Many new products in the healthcare sector require significant
research and development and may be subject to regulatory approvals, all of
which may be time consuming and costly with no guarantee that any product will
come to market.
Industrials
Sector Risk. The
industrials sector may be adversely affected by changes in the supply of and
demand for products and services, product obsolescence, claims for environmental
damage or product liability and general economic conditions, among other
factors.
Technology
Sector Risk. Market or economic factors
impacting technology companies could have a major effect on the value of the
Fund’s investments. The value of stocks of technology companies is particularly
vulnerable to rapid changes in technology product cycles, rapid product
obsolescence and frequent new product introduction, unpredictable changes in
growth rates and competition for the services of qualified personnel, and
government regulation and competition, both domestically and internationally,
including competition from foreign competitors with lower production costs.
Stocks of technology companies, especially those of smaller, less-seasoned
companies, tend to be more volatile than the overall market. Technology
companies are heavily dependent on patent and intellectual property rights, the
loss or impairment of which may adversely affect
profitability.
Transactions
Risk. The Fund
could experience a loss and its liquidity may be negatively impacted when
selling securities to meet redemption requests. The risk of loss increases if
the redemption requests are unusually large or frequent or occur in times of
overall market turmoil or declining prices. Similarly, large purchases of Fund
shares may adversely affect the Fund’s performance to the extent that the Fund
is delayed in investing new cash and is required to maintain a larger cash
position than it ordinarily would.
Investments
in the Fund are not deposits or obligations of, or guaranteed or endorsed by,
any bank and are not insured or guaranteed by the FDIC, the Federal Reserve
Board or any other government agency.
You could
lose money investing in the Fund.
The
Fund’s Past Performance
This section
provides some indication of the risks of investing in the Fund. The bar chart
shows how the performance of the Fund’s Class
L Shares has varied from year to year for the past ten calendar years. The table
shows the average annual total returns over the past one year, five years and
ten years. The
table compares the Fund’s
performance to the performance of the Russell 3000® Index and Russell
2000® Growth Index. The Russell
3000® Index serves as the Fund’s
regulatory index and provides a broad measure of market performance. The Russell
2000® Growth Index is the Fund’s
additional index and is more representative of the Fund’s investment universe
than the regulatory index.
Past performance
(before and after taxes) is not necessarily an indication of how any class of
the Fund will perform in the future. Updated
performance information is available by visiting www.jpmorganfunds.com or by
calling 1-800-480-4111.
Frank
Russell Company is the source and owner of the Russell Index data contained or
reflected in this material and all trademarks and copyrights related thereto.
Frank Russell Company is not responsible for the formatting or configuration of
this material or for any inaccuracy in the adviser’s presentation
thereof.
|
YEAR-BY-YEAR
RETURNS — CLASS L SHARES |
|
Best
Quarter |
2nd
quarter, 2020 |
37.49% |
|
Worst
Quarter |
2nd
quarter, 2022 |
-21.83% |
|
The
Fund’s year-to-date total return |
through |
9/30/24 |
was |
11.00% |
. |
November
1, 2024 | 41
JPMorgan
Small Cap Growth Fund
(continued)
|
AVERAGE
ANNUAL TOTAL RETURNS
(For
periods ended December 31, 2023) | |||
|
|
Past
1
Year |
Past
5
Years |
Past
10
Years |
|
CLASS
L SHARES |
|
|
|
|
Return
Before Taxes |
14.33
% |
9.98
% |
8.78
% |
|
Return
After Taxes on Distributions |
14.33 |
8.61 |
7.14 |
|
Return
After Taxes on Distributions and
Sale
of Fund Shares |
8.48 |
7.95 |
6.81 |
|
RUSSELL
3000 INDEX1
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
25.96 |
15.16 |
11.48 |
|
RUSSELL
2000 GROWTH INDEX
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
18.66 |
9.22 |
7.16 |
1
As a result of new regulatory
requirements, the Fund's regulatory index has changed from the Russell 2000
Growth Index to the Russell 3000 Index.
After-tax
returns are calculated using the historical highest individual federal marginal
income tax rates and do not reflect the impact of state and local taxes.
Actual
after-tax returns depend on
your tax situation and may differ from those shown. The after-tax returns shown
are not relevant to investors who hold their shares through tax-deferred
arrangements such as 401(k) plans or individual retirement
accounts.
Management
J.P. Morgan
Investment Management Inc. (the adviser)
|
Portfolio
Manager |
Managed
the
Fund
Since |
Primary
Title with
Investment
Adviser |
|
Eytan
Shapiro |
2004 |
Managing
Director |
|
Matthew
Cohen |
2016 |
Managing
Director |
|
Philip
D. Hart |
2023 |
Managing
Director |
|
Michael
Stein |
2023 |
Executive
Director |
Matthew Cohen, M.D. has
announced his retirement from J.P. Morgan Investment Management Inc. in the
spring of 2025. Dr. Cohen will continue to serve on the portfolio management
team of the Fund until his retirement, and upon his retirement the current
portfolio managers, Eytan Shapiro, Phillip D. Hart and Michael Stein will assume
full authority of the day-to-day management of the Fund. Mr. Shapiro will
continue as the lead portfolio manager on the Fund.
Purchase
and Sale of Fund Shares
Class L
Shares of the Fund are no longer generally available to new purchasers. Existing
Class L shareholders can still purchase additional shares, reinvest their
dividends and exchange into the Class L Shares from Class L Shares of other J.P.
Morgan Funds. In addition, certain group employer benefit plans, certain
fee-based advisory programs, college savings plans and other J.P. Morgan Funds
can continue to purchase shares as described in “Investing with J.P. Morgan
Funds — FUNDS SUBJECT TO A LIMITED OFFERING” in the
prospectus.
Purchase
minimums
|
For
Class L Shares |
|
|
To
establish an account |
$3,000,000 |
|
To
add to an account |
No
minimum levels |
In general,
you may purchase or redeem shares on any business day:
●
Through your
Financial Intermediary
●
By writing to
J.P. Morgan Funds Services, P.O. Box 219143, Kansas City, MO
64121-9143
●
After you
open an account, by calling J.P. Morgan Funds Services at
1-800-480-4111
Tax
Information
The Fund
intends to make distributions that may be taxed as ordinary income or capital
gains, except when your investment is in an IRA, 401(k) plan or other
tax-advantaged investment plan, in which case you may be subject to federal
income tax upon withdrawal from the tax-advantaged investment
plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If you
purchase shares of the Fund through a broker-dealer or other financial
intermediary (such as a bank), the Fund and its related companies may pay the
financial intermediary for the sale of Fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
financial intermediary and your salesperson to recommend the Fund over another
investment. Ask your salesperson or visit your financial intermediary’s website
for more information.
42 | J.P.
Morgan U.S. Equity Funds
JPMorgan
Small Cap Value Fund
Class/Ticker:
A/PSOAX; C/OSVCX; I/PSOPX
What
is the goal of the Fund?
The Fund
seeks long-term capital growth primarily by investing in equity securities of
small-capitalization companies.
Fees
and Expenses of the Fund
The following
tables describe the fees and expenses that you may pay if you buy, hold and sell
shares of the Fund. You may pay other fees, such as brokerage commissions and
other fees to financial intermediaries, which are not reflected in the table and
examples below. You may
qualify for sales charge discounts on purchases
of Class A Shares if you and your family invest, or agree to invest in the
future, at least $50,000 in the J.P.
Morgan Funds. More
information about these and other discounts is available from your financial
intermediary and in “Investing with J.P. Morgan Funds — SALES CHARGES AND
FINANCIAL INTERMEDIARY COMPENSATION” on page 97
and in “Financial Intermediary-Specific Sales Charge Waivers” in Appendix A of
the prospectus and in “PURCHASES, REDEMPTIONS AND EXCHANGES” in Appendix A to
Part II of the Statement of Additional Information.
|
SHAREHOLDER
FEES (Fees
paid directly from your investment) | |||
|
|
Class
A |
Class
C |
Class
I |
|
Maximum
Sales Charge (Load)
Imposed
on Purchases, as % of
the
Offering Price |
5.25% |
NONE |
NONE |
|
Maximum
Deferred Sales Charge
(Load),
as % of Original Cost of
the
Shares |
NONE1
|
1.00% |
NONE |
1
For purchases
under $1 million.
|
ANNUAL
FUND OPERATING EXPENSES
(Expenses
that you pay each year as a percentage of the value
of
your investment) | |||
|
|
Class
A |
Class
C |
Class
I |
|
Management
Fees |
0.65% |
0.65% |
0.65% |
|
Distribution
(Rule 12b-1)
Fees |
0.25 |
0.75 |
NONE |
|
Other
Expenses |
0.38 |
0.41 |
0.36 |
|
Service
Fees |
0.25 |
0.25 |
0.25 |
|
Remainder
of Other
Expenses |
0.13 |
0.16 |
0.11 |
|
Total
Annual Fund Operating
Expenses |
1.28 |
1.81 |
1.01 |
|
Fee
Waivers and/or Expense
Reimbursements
1 |
-0.09 |
-0.12 |
-0.07 |
|
Total
Annual Fund Operating
Expenses
after Fee Waivers
and/or
Expense Reimburse-
ments
1 |
1.19 |
1.69 |
0.94 |
1
The Fund’s
adviser and/or its affiliates have contractually agreed to waive
fees and/or reimburse expenses
to the extent Total Annual Fund Operating Expenses (excluding acquired fund fees
and expenses other than certain money market fund fees as described below,
dividend and interest expenses related to short sales, interest, taxes, expenses
related to litigation and potential litigation, expenses related to trustee
elections, and extraordinary expenses) exceed 1.19%, 1.69% and 0.94% of the
average daily net assets of Class A, Class C and Class I Shares, respectively.
The Fund may invest in one or more money market funds advised by the adviser or
its affiliates (affiliated money market funds). The Fund’s adviser, shareholder
servicing agent and/or administrator have contractually agreed to waive fees
and/or reimburse expenses in an amount sufficient to offset the respective net
fees each collects from the affiliated money market funds on the Fund’s
investment in such money market funds. These waivers are in effect through
10/31/25, at which time it will be
determined whether such waivers will be renewed or revised. To the extent that
the Fund engages in securities lending, affiliated money market fund fees and
expenses resulting from the Fund’s investment of cash received from securities
lending borrowers are not included in Total Annual Fund Operating Expenses and
therefore, the above waivers do not apply to such investments.
Example
This Example is intended to
help you compare the cost of investing in the Fund with the cost of investing in
other mutual funds. The Example assumes that you invest $10,000 in the Fund for
the time periods indicated. The Example also assumes that your investment has a
5% return each year and that the Fund’s operating expenses are equal to the
total annual fund operating expenses after fee waivers and expense
reimbursements shown in the fee table through 10/31/25 and total annual fund
operating expenses thereafter. Your actual costs may be higher or
lower.
|
IF
YOU SELL YOUR SHARES, YOUR COST WOULD BE: | ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
A SHARES ($) |
640 |
901 |
1,182 |
1,982 |
|
CLASS
C SHARES ($) |
272 |
558 |
969 |
1,978 |
|
CLASS
I SHARES ($) |
96 |
315 |
551 |
1,230 |
|
IF
YOU DO NOT SELL YOUR SHARES, YOUR COST
WOULD
BE: | ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
A SHARES ($) |
640 |
901 |
1,182 |
1,982 |
|
CLASS
C SHARES ($) |
172 |
558 |
969 |
1,978 |
|
CLASS
I SHARES ($) |
96 |
315 |
551 |
1,230 |
Portfolio
Turnover
The Fund pays transaction
costs, such as commissions, when it buys and sells securities (or “turns over”
its portfolio). A higher portfolio turnover rate may indicate higher transaction
costs and may result in higher taxes when Fund shares are held in a taxable
account. These costs, which are not reflected in annual fund operating expenses
or in the Example, affect the Fund’s performance. During the Fund’s most recent
fiscal year, the Fund’s portfolio turnover rate was 61% of the average value of its
portfolio.
November
1, 2024 | 43
JPMorgan
Small Cap Value Fund
(continued)
What
are the Fund’s main investment strategies?
Under normal circumstances,
the Fund invests at least 80% of its Assets in equity securities of small cap
companies. “Assets” means net assets, plus the amount of borrowings for
investment purposes. Small cap companies are companies with market
capitalizations equal to those within the universe of the Russell
2000® Value Index at the time of
purchase. As of the reconstitution of the Russell 2000 Value Index on September
30, 2024, the market capitalizations of the companies in the index ranged from
$0.70 million to $7.32 billion. In reviewing investment opportunities for the
Fund, its adviser uses a value-oriented approach. In implementing its main
strategies, the Fund’s equity investments are primarily in common stocks and
real estate investment trusts (REITs).
Derivatives,
which are instruments that have a value based on another instrument, exchange
rate or index, may be used as substitutes for securities in which the Fund can
invest. The Fund may use futures contracts to gain or reduce exposure to its
index, maintain liquidity and minimize transaction costs. In managing cash
flows, the Fund buys futures contracts to invest incoming cash in the market or
sells futures contracts in response to cash outflows, thereby gaining market
exposure to the index while maintaining a cash balance for
liquidity.
Investment
Process: In managing the Fund, the adviser employs a process that ranks stocks
based on its proprietary stock ranking system. The rankings are then reviewed
and adjusted utilizing fundamental research conducted by the investment team to
enhance accuracy and consistency. The adjusted rankings are used to place stocks
into portfolios. As part of its investment process, the adviser seeks to assess
the impact of environmental, social and governance (ESG) factors on many issuers
in the universe in which the Fund may invest. The adviser’s assessment is based
on an analysis of key opportunities and risks across industries to seek to
identify financially material issues with respect to the Fund’s investments in
securities and ascertain key issues that merit engagement with issuers. These
assessments may not be conclusive and securities of issuers that may be
negatively impacted by such factors may be purchased and retained by the Fund
while the Fund may divest or not invest in securities of issuers that may be
positively impacted by such factors. In general, stocks are purchased when they
are among the top ranked within their sector. Stocks become candidates for sale
when their ranking falls, when they appear unattractive or when the company is
no longer a small cap company. The Fund may continue to hold the securities if
it believes further substantial growth is possible. Risk factor exposures are
managed through portfolio construction. Portfolio constraints control for sector
weights, position sizes and/or style characteristics of the
Fund.
The
Fund’s Main Investment Risks
The Fund is
subject to management risk and may not achieve its objective if the adviser’s
expectations regarding particular instruments or markets are not
met.
An
investment in this Fund or any other fund may not provide a complete investment
program. The suitability of an investment in the Fund should be considered based
on the investment objective, strategies and risks described in this Prospectus,
considered in light of all of the other investments in your portfolio, as well
as your risk tolerance, financial goals and time horizons. You may want to
consult with a financial advisor to determine if this Fund is suitable for
you.
The Fund is
subject to the main risks noted below, any of which may adversely affect the
Fund’s performance and ability to meet its investment
objective.
Equity
Market Risk. The price of
equity securities may rise or fall because of changes in the broad market or
changes in a company’s financial condition, sometimes rapidly or unpredictably.
These price movements may result from factors affecting individual companies,
sectors or industries selected for the Fund’s portfolio or the securities market
as a whole, such as changes in economic or political conditions. When the value
of the Fund’s portfolio securities goes down, your investment in the Fund
decreases in value.
General
Market Risk. Economies and
financial markets throughout the world are becoming increasingly interconnected,
which increases the likelihood that events or conditions in one country or
region will adversely impact markets or issuers in other countries or regions.
Securities in the Fund’s portfolio may underperform in comparison to securities
in general financial markets, a particular financial market or other asset
classes due to a number of factors, including inflation (or expectations for
inflation), deflation (or expectations for deflation), interest rates, global
demand for particular products or resources, market instability, financial
system instability, debt crises and downgrades, embargoes, tariffs, sanctions
and other trade barriers, regulatory events, other governmental trade or market
control programs and related geopolitical events. In addition, the value of the
Fund’s investments may be negatively affected by the occurrence of global events
such as war, terrorism, environmental disasters, natural disasters or events,
country instability, and infectious disease epidemics or
pandemics.
Smaller
Company Risk. Investments
in smaller companies may be riskier, less liquid, more volatile and more
vulnerable to economic, market and industry changes than investments in larger,
more established companies. The securities of smaller companies may trade less
frequently and in smaller volumes than securities of larger companies. As a
result, the share price changes may be more sudden or erratic than the prices of
other securities, especially over the short term.
44 | J.P.
Morgan U.S. Equity Funds
Value
Investing Risk. A value
stock may decrease in price or may not increase in price as anticipated by the
adviser if other investors fail to recognize the company’s value or the factors
that the adviser believes will cause the stock price to increase do not
occur.
Derivatives
Risk. Derivatives, including
futures contracts, may be riskier than other types of investments and may
increase the volatility of the Fund. Derivatives may be sensitive to changes in
economic and market conditions and may create leverage, which could result in
losses that significantly exceed the Fund’s original investment. The Fund may be
more volatile than if the Fund had not been leveraged because the leverage tends
to exaggerate any effect on the value of the Fund’s portfolio securities.
Certain derivatives expose the Fund to counterparty risk, which is the risk that
the derivative counterparty will not fulfill its contractual obligations (and
includes credit risk associated with the counterparty). Certain derivatives are
synthetic instruments that attempt to replicate the performance of certain
reference assets. With regard to such derivatives, the Fund does not have a
claim on the reference assets and is subject to enhanced counterparty risk.
Derivatives may not perform as expected, so the Fund may not realize the
intended benefits. When used for hedging, the change in value of a derivative
may not correlate as expected with the security or other risk being hedged. In
addition, given their complexity, derivatives expose the Fund to risks of
mispricing or improper valuation. Derivatives also can expose the Fund to
derivative liquidity risk,
which includes
risks involving the liquidity demands that derivatives can create to make
payments of margin, collateral, or settlement payments to counterparties, legal
risk,
which includes
the risk of loss resulting from insufficient or unenforceable contractual
documentation, insufficient capacity or authority of the Fund’s counterparty and
operational risk, which includes documentation or settlement issues, system
failures, inadequate controls and human error.
Real
Estate Securities Risk. The Fund’s
investments in real estate securities, including REITs, are subject to the same
risks as direct investments in real estate and mortgages, and their value will
depend on the value of the underlying real estate interests. These risks include
default, prepayments, changes in value resulting from changes in interest rates
and demand for real and rental property, and the management skill and
credit-worthiness of REIT issuers. The Fund, will indirectly bear its
proportionate share of expenses, including management fees, paid by each REIT in
which it invests in addition to the expenses of the Fund.
Industry
and Sector Focus Risk. At times,
the Fund may increase the relative emphasis of its investments in a particular
industry or sector. The prices of securities of issuers in a particular industry
or sector may be more susceptible to fluctuations due to changes in economic or
business conditions, government regulations, availability of basic resources or
supplies, contagion risk within a particular industry or sector or to other
industries or sectors, or other events that affect that industry or
sector more than securities
of issuers in other industries and sectors. To the extent that the Fund
increases the relative emphasis of its investments in a particular industry or
sector, the value of the Fund’s shares may fluctuate in response to events
affecting that industry or sector.
Financials
Sector Risk. Financial
services companies are subject to extensive governmental regulation which may
limit both the amounts and types of loans and other financial commitments they
can make, the interest rates and fees they can charge, the scope of their
activities, the prices they can charge and the amount of capital they must
maintain. Profitability is largely dependent on the availability and cost of
capital funds and can fluctuate significantly when interest rates change or due
to increased competition. In addition, deterioration of the credit markets
generally may cause an adverse impact in a broad range of markets, including
U.S. and international credit and interbank money markets generally, thereby
affecting a wide range of financial institutions and markets. Certain events in
the financials sector may cause an unusually high degree of volatility in the
financial markets, both domestic and foreign, and cause certain financial
services companies to incur large losses. Securities of financial services
companies may experience a dramatic decline in value when such companies
experience substantial declines in the valuations of their assets, take action
to raise capital (such as the issuance of debt or equity securities), or cease
operations. Credit losses resulting from financial difficulties of borrowers and
financial losses associated with investment activities can negatively impact the
sector. Insurance companies may be subject to severe price competition. Adverse
economic, business or political developments could adversely affect financial
institutions engaged in mortgage finance or other lending or investing
activities directly or indirectly connected to the value of real
estate.
Transactions
Risk. The Fund
could experience a loss and its liquidity may be negatively impacted when
selling securities to meet redemption requests. The risk of loss increases if
the redemption requests are unusually large or frequent or occur in times of
overall market turmoil or declining prices. Similarly, large purchases of Fund
shares may adversely affect the Fund’s performance to the extent that the Fund
is delayed in investing new cash and is required to maintain a larger cash
position than it ordinarily would.
Investments
in the Fund are not deposits or obligations of, or guaranteed or endorsed by,
any bank and are not insured or guaranteed by the FDIC, the Federal Reserve
Board or any other government agency.
You could
lose money investing in the Fund.
The
Fund’s Past Performance
This section
provides some indication of the risks of investing in the Fund. The bar chart
shows how the performance of the Fund’s Class
I Shares has varied from year to year for the past
November
1, 2024 | 45
JPMorgan
Small Cap Value Fund
(continued)
ten calendar years. The table
shows the average annual total returns over the past one year, five years and
ten years. The
table compares
the Fund’s performance to the performance of the Russell 3000® Index and Russell
2000® Value Index. The Russell
3000® Index serves as the Fund’s
regulatory index and provides a broad measure of market performance. The Russell
2000® Value Index is the Fund’s
additional index and is more representative of the Fund’s investment universe
than the regulatory index.
Past performance
(before and after taxes) is not necessarily an indication of how any class of
the Fund will perform in the future. Updated
performance information is available by visiting www.jpmorganfunds.com or by
calling 1-800-480-4111.
Frank
Russell Company is the source and owner of the Russell Index data contained or
reflected in this material and all trademarks and copyrights related thereto.
Frank Russell Company is not responsible for the formatting or configuration of
this material or for any inaccuracy in the adviser’s presentation
thereof.
|
YEAR-BY-YEAR
RETURNS — CLASS I SHARES |
|
Best
Quarter |
4th
quarter, 2020 |
33.44% |
|
Worst
Quarter |
1st
quarter, 2020 |
-34.64% |
|
The
Fund’s year-to-date total return |
through |
9/30/24 |
was |
10.32% |
. |
|
AVERAGE
ANNUAL TOTAL RETURNS
(For
periods ended December 31, 2023) | |||
|
|
Past
1
Year |
Past
5
Years |
Past
10
Years |
|
CLASS
I SHARES |
|
|
|
|
Return
Before Taxes |
13.07
% |
10.42
% |
6.21
% |
|
Return
After Taxes on Distributions |
12.54 |
8.56 |
4.52 |
|
Return
After Taxes on Distributions and
Sale
of Fund Shares |
7.95 |
7.96 |
4.60 |
|
CLASS
A SHARES |
|
|
|
|
Return
Before Taxes |
6.83 |
8.95 |
5.36 |
|
CLASS
C SHARES |
|
|
|
|
Return
Before Taxes |
11.19 |
9.58 |
5.47 |
|
RUSSELL
3000 INDEX1
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
25.96 |
15.16 |
11.48 |
|
RUSSELL
2000 VALUE INDEX
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
14.65 |
10.00 |
6.76 |
1
As a result of new regulatory
requirements, the Fund's regulatory index has changed from the Russell 2000
Value Index to the Russell 3000 Index.
After-tax
returns are shown only for the Class I Shares, and after-tax returns for the
other classes will vary.
After-tax
returns are calculated using the historical highest individual federal marginal
income tax rates and do not reflect the impact of state and local taxes.
Actual
after-tax returns depend on your tax situation
and may differ from those shown. The after-tax returns shown are not relevant to
investors who hold their shares through tax-deferred arrangements such as 401(k)
plans or individual retirement accounts.
Management
J.P. Morgan
Investment Management Inc. (the adviser)
|
Portfolio
Manager |
Managed
the
Fund
Since |
Primary
Title with
Investment
Adviser |
|
Phillip
D. Hart |
2010 |
Managing
Director |
|
Wonseok
Choi |
2019 |
Managing
Director |
|
Akash
Gupta |
2019 |
Executive
Director |
|
Robert
A. Ippolito |
2022 |
Executive
Director |
Purchase
and Sale of Fund Shares
Purchase
minimums
|
For
Class A and Class C Shares |
|
|
To
establish an account |
$1,000 |
|
To
add to an account |
$50 |
|
For
Class I Shares |
|
|
To
establish an account |
$1,000,000 |
|
To
add to an account |
No
minimum levels |
46 | J.P.
Morgan U.S. Equity Funds
In general,
you may purchase or redeem shares on any business day:
●
Through your
Financial Intermediary
●
By writing to
J.P. Morgan Funds Services, P.O. Box 219143, Kansas City, MO
64121-9143
●
After you
open an account, by calling J.P. Morgan Funds Services at
1-800-480-4111
Tax
Information
The Fund
intends to make distributions that may be taxed as ordinary income or capital
gains, except when your investment is in an IRA, 401(k) plan or other
tax-advantaged investment plan, in which case you may be subject to federal
income tax upon withdrawal from the tax-advantaged investment
plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If you
purchase shares of the Fund through a broker-dealer or other financial
intermediary (such as a bank), the Fund and its related companies may pay the
financial intermediary for the sale of Fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
financial intermediary and your salesperson to recommend the Fund over another
investment. Ask your salesperson or visit your financial intermediary’s website
for more information.
November
1, 2024 | 47
JPMorgan
SMID Cap Equity Fund
Class/Ticker:
A/PECAX; C/ODMCX; I/WOOPX
What
is the goal of the Fund?
The Fund
seeks long-term capital growth by investing primarily in equity securities of
companies with intermediate capitalizations.
Fees
and Expenses of the Fund
The following
tables describe the fees and expenses that you may pay if you buy, hold and sell
shares of the Fund. You may pay other fees, such as brokerage commissions and
other fees to financial intermediaries, which are not reflected in the table and
examples below. You may
qualify for sales charge discounts on purchases
of Class A Shares if you and your family invest, or agree to invest in the
future, at least $50,000 in the J.P.
Morgan Funds. More
information about these and other discounts is available from your financial
intermediary and in “Investing with J.P. Morgan Funds — SALES CHARGES AND
FINANCIAL INTERMEDIARY COMPENSATION” on page 97
and in “Financial Intermediary-Specific Sales Charge Waivers” in Appendix A of
the prospectus and in “PURCHASES, REDEMPTIONS AND EXCHANGES” in Appendix A to
Part II of the Statement of Additional Information..
|
SHAREHOLDER
FEES (Fees
paid directly from your investment) | |||
|
|
Class
A |
Class
C |
Class
I |
|
Maximum
Sales Charge (Load)
Imposed
on Purchases, as % of
the
Offering Price |
5.25% |
NONE |
NONE |
|
Maximum
Deferred Sales Charge
(Load),
as % of Original Cost of
the
Shares |
NONE1
|
1.00% |
NONE |
1
For purchases
under $1 million.
|
ANNUAL
FUND OPERATING EXPENSES
(Expenses
that you pay each year as a percentage of the value
of
your investment) | |||
|
|
Class
A |
Class
C |
Class
I |
|
Management
Fees |
0.55% |
0.55% |
0.55% |
|
Distribution
(Rule 12b-1)
Fees |
0.25 |
0.75 |
NONE |
|
Other
Expenses |
0.42 |
0.42 |
0.41 |
|
Service
Fees |
0.25 |
0.25 |
0.25 |
|
Remainder
of Other
Expenses |
0.17 |
0.17 |
0.16 |
|
Total
Annual Fund Operating
Expenses |
1.22 |
1.72 |
0.96 |
|
Fee
Waivers and/or Expense
Reimbursements
1 |
-0.13 |
-0.13 |
-0.12 |
|
Total
Annual Fund Operating
Expenses
after Fee Waivers
and/or
Expense Reimburse-
ments
1 |
1.09 |
1.59 |
0.84 |
1
The Fund’s adviser and/or its
affiliates have contractually agreed to waive fees and/or reimburse expenses to
the extent Total Annual Fund Operating Expenses (excluding acquired fund fees
and expenses other than certain money market fund fees as described below,
dividend and interest expenses related to short sales, interest, taxes, expenses
related to litigation and potential litigation, expenses related to trustee
elections, and extraordinary expenses) exceed 1.09%, 1.59% and 0.84% of the
average daily net assets of Class A, Class C and Class I Shares, respectively.
The Fund may invest in one or more money market funds advised by the adviser or
its affiliates (affiliated money market funds). The Fund’s adviser, shareholder
servicing agent and/or administrator have contractually agreed to waive fees
and/or reimburse expenses in an amount sufficient to offset the respective net
fees each collects from the affiliated money market funds on the Fund’s
investment in such money market funds. These waivers are in effect through
10/31/25, at which time it will be
determined whether such waivers will be renewed or revised. To the extent that
the Fund engages in securities lending, affiliated money market fund fees and
expenses resulting from the Fund’s investment of cash received from securities
lending borrowers are not included in Total Annual Fund Operating Expenses and
therefore, the above waivers do not apply to such
investments.
Example
This Example is intended to
help you compare the cost of investing in the Fund with the cost of investing in
other mutual funds. The Example assumes that you invest $10,000 in the Fund for
the time periods indicated. The Example also assumes that your investment has a
5% return each year and that the Fund’s operating expenses are equal to the
total annual fund operating expenses after fee waivers and expense
reimbursements shown in the fee table through 10/31/25 and total annual fund
operating expenses thereafter. Your actual costs may be higher or
lower.
|
IF
YOU SELL YOUR SHARES, YOUR COST WOULD BE: | ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
A SHARES ($) |
630 |
880 |
1,148 |
1,914 |
|
CLASS
C SHARES ($) |
262 |
529 |
921 |
1,887 |
|
CLASS
I SHARES ($) |
86 |
294 |
519 |
1,167 |
|
IF
YOU DO NOT SELL YOUR SHARES, YOUR COST
WOULD
BE: | ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
A SHARES ($) |
630 |
880 |
1,148 |
1,914 |
|
CLASS
C SHARES ($) |
162 |
529 |
921 |
1,887 |
|
CLASS
I SHARES ($) |
86 |
294 |
519 |
1,167 |
Portfolio
Turnover
The Fund pays transaction
costs, such as commissions, when it buys and sells securities (or “turns over”
its portfolio). A higher portfolio turnover rate may indicate higher transaction
costs and may result in higher taxes when Fund shares are held in a taxable
account. These costs, which are not reflected in annual fund operating expenses
or in the Example, affect the Fund’s performance. During the Fund’s most recent
fiscal year, the Fund’s portfolio turnover rate was 39% of the average value of its
portfolio.
48 | J.P.
Morgan U.S. Equity Funds
What
are the Fund’s main investment strategies?
Under normal circumstances,
at least 80% of the Fund’s Assets will be invested in equity securities of
small- to mid-cap companies. “Assets” means net assets, plus the amount of
borrowings for investment purposes. Small- to mid-cap companies are generally
considered to be those companies with market capitalizations similar to those
within the universe of the Russell 2500® Index at the time of
purchase. As of the reconstitution of the Russell 2500 Index on September 30,
2024, the market capitalizations of the companies in the index ranged from $2.70
million to $25.50 billion. In implementing its main strategies, the Fund invests
primarily in common stocks.
Derivatives,
which are instruments that have a value based on another instrument, exchange
rate or index, may be used as substitutes for securities in which the Fund can
invest. To the extent the Fund uses derivatives, the Fund will primarily use
futures contracts to more effectively gain targeted equity exposure from its
cash positions.
Investment
Process: In managing the Fund, the adviser employs a fundamental bottom-up
investment process and seeks to invest in attractively valued companies with
leading competitive positions and predictable and durable business models. It
also seeks to invest the Fund’s assets in companies whose management has a
successful track record of prudent capital allocation. As part of its investment
process, the adviser seeks to assess the impact of environmental, social and
governance (ESG) factors on many issuers in the universe in which the Fund may
invest. The adviser’s assessment is based on an analysis of key opportunities
and risks across industries to seek to identify financially material issues with
respect to the Fund’s investments in securities and ascertain key issues that
merit engagement with issuers. These assessments may not be conclusive and
securities of issuers that may be negatively impacted by such factors may be
purchased and retained by the Fund while the Fund may divest or not invest in
securities of issuers that may be positively impacted by such
factors.
The adviser
may sell a security for several reasons. A security may be sold due to a change
in a company’s fundamentals or if the adviser believes the security is no longer
attractively valued. Investments may also be sold if the adviser identifies a
stock that it believes offers a better investment
opportunity.
The
Fund’s Main Investment Risks
The Fund is
subject to management risk and may not achieve its objective if the adviser’s
expectations regarding particular instruments or markets are not
met.
An
investment in this Fund or any other fund may not provide a complete investment
program. The suitability of an investment in the Fund should be considered based
on the investment objective, strategies and risks described in this Prospectus,
considered in light of all of the other investments in your portfolio, as well
as your risk tolerance, financial goals and time horizons. You may want to
consult with a financial advisor to determine if this Fund is suitable for
you.
The Fund is
subject to the main risks noted below, any of which may adversely affect the
Fund’s performance and ability to meet its investment
objective.
Equity
Market Risk. The price of
equity securities may rise or fall because of changes in the broad market or
changes in a company’s financial condition, sometimes rapidly or unpredictably.
These price movements may result from factors affecting individual companies,
sectors or industries selected for the Fund’s portfolio or the securities market
as a whole, such as changes in economic or political conditions. When the value
of the Fund’s portfolio securities goes down, your investment in the Fund
decreases in value.
General
Market Risk. Economies and
financial markets throughout the world are becoming increasingly interconnected,
which increases the likelihood that events or conditions in one country or
region will adversely impact markets or issuers in other countries or regions.
Securities in the Fund’s portfolio may underperform in comparison to securities
in general financial markets, a particular financial market or other asset
classes due to a number of factors, including inflation (or expectations for
inflation), deflation (or expectations for deflation), interest rates, global
demand for particular products or resources, market instability, financial
system instability, debt crises and downgrades, embargoes, tariffs, sanctions
and other trade barriers, regulatory events, other governmental trade or market
control programs and related geopolitical events. In addition, the value of the
Fund’s investments may be negatively affected by the occurrence of global events
such as war, terrorism, environmental disasters, natural disasters or events,
country instability, and infectious disease epidemics or
pandemics.
Smaller
Company Risk. Investments
in securities of smaller companies (mid cap and small cap companies) may be
riskier, less liquid, more volatile and more vulnerable to economic, market and
industry changes than securities of larger, more established companies. The
securities of smaller companies may trade less frequently and in smaller volumes
than securities of larger companies. As a result, changes in the price of
securities issued by such companies may be more sudden or erratic than the
prices of securities of large capitalization companies, especially over the
short term. These risks are higher for small cap companies.
November
1, 2024 | 49
JPMorgan
SMID Cap Equity Fund
(continued)
Derivatives
Risk. Derivatives, including
futures contracts, may be riskier than other types of investments and may
increase the volatility of the Fund. Derivatives may be sensitive to changes in
economic and market conditions and may create leverage, which could result in
losses that significantly exceed the Fund’s original investment. The Fund may be
more volatile than if the Fund had not been leveraged because the leverage tends
to exaggerate any effect on the value of the Fund’s portfolio securities.
Certain derivatives expose the Fund to counterparty risk, which is the risk that
the derivative counterparty will not fulfill its contractual obligations (and
includes credit risk associated with the counterparty). Certain derivatives are
synthetic instruments that attempt to replicate the performance of certain
reference assets. With regard to such derivatives, the Fund does not have a
claim on the reference assets and is subject to enhanced counterparty risk.
Derivatives may not perform as expected, so the Fund may not realize the
intended benefits. When used for hedging, the change in value of a derivative
may not correlate as expected with the security or other risk being hedged. In
addition, given their complexity, derivatives expose the Fund to risks of
mispricing or improper valuation. Derivatives also can expose the Fund to
derivative liquidity risk,
which includes
risks involving the liquidity demands that derivatives can create to make
payments of margin, collateral, or settlement payments to counterparties, legal
risk,
which includes
the risk of loss resulting from insufficient or unenforceable contractual
documentation, insufficient capacity or authority of the Fund’s counterparty and
operational risk, which includes documentation or settlement issues, system
failures, inadequate controls and human error.
Industry
and Sector Focus Risk. At times, the Fund may
increase the relative emphasis of its investments in a particular industry or
sector. The prices of securities of issuers in a particular industry or sector
may be more susceptible to fluctuations due to changes in economic or business
conditions, government regulations, availability of basic resources or supplies,
contagion risk within a particular industry or sector or to other industries or
sectors, or other events that affect that industry or sector more than
securities of issuers in other industries and sectors. To the extent that the
Fund increases the relative emphasis of its investments in a particular industry
or sector, the value of the Fund’s shares may fluctuate in response to events
affecting that industry or sector.
Financials
Sector Risk. Financial
services companies are subject to extensive governmental regulation which may
limit both the amounts and types of loans and other financial commitments they
can make, the interest rates and fees they can charge, the scope of their
activities, the prices they can charge and the amount of capital they must
maintain. Profitability is largely dependent on the availability and cost of
capital funds and can fluctuate significantly when interest rates change or due
to increased competition. In addition, deterioration of the credit markets
generally may cause an adverse impact in a broad range of markets, including
U.S. and international credit and interbank money markets generally, thereby
affecting a wide
range of
financial institutions and markets. Certain events in the financials sector may
cause an unusually high degree of volatility in the financial markets, both
domestic and foreign, and cause certain financial services companies to incur
large losses. Securities of financial services companies may experience a
dramatic decline in value when such companies experience substantial declines in
the valuations of their assets, take action to raise capital (such as the
issuance of debt or equity securities), or cease operations. Credit losses
resulting from financial difficulties of borrowers and financial losses
associated with investment activities can negatively impact the sector.
Insurance companies may be subject to severe price competition. Adverse
economic, business or political developments could adversely affect financial
institutions engaged in mortgage finance or other lending or investing
activities directly or indirectly connected to the value of real
estate.
Industrials
Sector Risk. The
industrials sector may be adversely affected by changes in the supply of and
demand for products and services, product obsolescence, claims for environmental
damage or product liability and general economic conditions, among other
factors.
Transactions
Risk. The Fund
could experience a loss and its liquidity may be negatively impacted when
selling securities to meet redemption requests. The risk of loss increases if
the redemption requests are unusually large or frequent or occur in times of
overall market turmoil or declining prices. Similarly, large purchases of Fund
shares may adversely affect the Fund’s performance to the extent that the Fund
is delayed in investing new cash and is required to maintain a larger cash
position than it ordinarily would.
Investments
in the Fund are not deposits or obligations of, or guaranteed or endorsed by,
any bank and are not insured or guaranteed by the FDIC, the Federal Reserve
Board or any other government agency.
You could
lose money investing in the Fund.
The
Fund’s Past Performance
This section provides some
indication of the risks of investing in the Fund. The bar chart shows how the
performance of the Fund’s Class I Shares has
varied from year to year for the past ten calendar years. The table shows the
average annual total returns over the past one year, five years and ten years.
The table compares the Fund’s
performance to the performance of the Russell 3000® Index and Russell
2500® Index. The Russell
3000® Index serves as the Fund’s
regulatory index and provides a broad measure of market performance. The Russell
2500®
Index is the
Fund’s additional index and is more representative of the Fund’s investment
universe than the regulatory index.
Effective
11/1/20, the Fund’s investment strategies changed. The Fund’s past performance
would have been different if the Fund were managed using the current strategies.
Past performance
(before and
after taxes) is not necessarily an indication of how
50 | J.P.
Morgan U.S. Equity Funds
any class of
the Fund will perform in the future. Updated
performance information is available by visiting www.jpmorganfunds.com
or by calling 1-800-480-4111.
Frank
Russell Company is the source and owner of the Russell Index data contained or
reflected in this material and all trademarks and copyrights related thereto.
Frank Russell Company is not responsible for the formatting or configuration of
this material or for any inaccuracy in the adviser’s presentation
thereof.
|
YEAR-BY-YEAR
RETURNS — CLASS I SHARES |
|
Best
Quarter |
2nd
quarter, 2020 |
22.42% |
|
Worst
Quarter |
1st
quarter, 2020 |
-28.46% |
|
The
Fund’s year-to-date total return |
through |
9/30/24 |
was |
12.32% |
. |
|
AVERAGE
ANNUAL TOTAL RETURNS
(For
periods ended December 31, 2023) | |||
|
|
Past
1
Year |
Past
5
Years |
Past
10
Years |
|
CLASS
I SHARES |
|
|
|
|
Return
Before Taxes |
13.32
% |
9.48
% |
7.09
% |
|
Return
After Taxes on Distributions |
13.18 |
6.87 |
4.43 |
|
Return
After Taxes on Distributions and
Sale
of Fund Shares |
7.98 |
7.02 |
5.03 |
|
CLASS
A SHARES |
|
|
|
|
Return
Before Taxes |
7.12 |
8.04 |
6.25 |
|
CLASS
C SHARES |
|
|
|
|
Return
Before Taxes |
11.41 |
8.66 |
6.34 |
|
RUSSELL
3000 INDEX1
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
25.96 |
15.16 |
11.48 |
|
RUSSELL
2500 INDEX
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
17.42 |
11.67 |
8.36 |
1
As a result of new regulatory
requirements, the Fund's regulatory index has
changed from the Russell 2500
Index to the Russell 3000 Index.
After-tax
returns are shown only for the Class I Shares, and after-tax returns for the
other classes will vary.
After-tax
returns are calculated using the historical highest individual federal marginal
income tax rates and do not reflect the impact of state and local taxes.
Actual
after-tax returns depend on your tax situation
and may differ from those shown. The after-tax returns shown are not relevant to
investors who hold their shares through tax-deferred arrangements such as 401(k)
plans or individual retirement accounts.
Management
J.P. Morgan
Investment Management Inc. (the adviser)
|
Portfolio
Manager |
Managed
the
Fund
Since |
Primary
Title with
Investment
Adviser |
|
Don
San Jose |
2020 |
Managing
Director |
|
Daniel
J. Percella |
2020 |
Managing
Director |
Purchase
and Sale of Fund Shares
Purchase
minimums
|
For
Class A and Class C Shares |
|
|
To
establish an account |
$1,000 |
|
To
add to an account |
$50 |
|
For
Class I Shares |
|
|
To
establish an account |
$1,000,000 |
|
To
add to an account |
No
minimum levels |
In general,
you may purchase or redeem shares on any business day:
●
Through your
Financial Intermediary
●
By writing to
J.P. Morgan Funds Services, P.O. Box 219143, Kansas City, MO
64121-9143
●
After you
open an account, by calling J.P. Morgan Funds Services at
1-800-480-4111
Tax
Information
The Fund
intends to make distributions that may be taxed as ordinary income or capital
gains, except when your investment is in an IRA, 401(k) plan or other
tax-advantaged investment plan, in which case you may be subject to federal
income tax upon withdrawal from the tax-advantaged investment
plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If you
purchase shares of the Fund through a broker-dealer or other financial
intermediary (such as a bank), the Fund and its related companies may pay the
financial intermediary for the sale of Fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
November
1, 2024 | 51
JPMorgan
SMID Cap Equity Fund
(continued)
financial
intermediary and your salesperson to recommend the Fund over another investment.
Ask your salesperson or visit your financial intermediary’s website for more
information.
52 | J.P.
Morgan U.S. Equity Funds
JPMorgan
U.S. Small Company Fund
|
| |||
|
|
Class
A |
Class
C |
Class
I |
|
Maximum
Sales Charge (Load)
Imposed
on Purchases, as % of the
Offering
Price |
|
|
|
|
Maximum
Deferred Sales Charge
(Load),
as % of Original Cost of the
Shares |
1
|
|
|
1
|
| |||
|
|
Class
A |
Class
C |
Class
I |
|
Management
Fees |
|
|
|
|
Distribution
(Rule 12b-1)
Fees |
|
|
|
|
Other
Expenses |
|
|
|
|
Service
Fees |
|
|
|
|
Remainder
of Other
Expenses |
|
|
|
|
Total
Annual Fund Operating
Expenses |
|
|
|
|
Fee
Waivers and/or Expense
Reimbursements
1 |
- |
- |
- |
|
Total
Annual Fund Operating
Expenses
after Fee Waivers
and/or
Expense Reimburse-
ments
1 |
|
|
|
1
|
| ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
A SHARES ($) |
|
|
|
|
|
CLASS
C SHARES ($) |
|
|
|
|
|
CLASS
I SHARES ($) |
|
|
|
|
|
| ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
A SHARES ($) |
|
|
|
|
|
CLASS
C SHARES ($) |
|
|
|
|
|
CLASS
I SHARES ($) |
|
|
|
|
November
1, 2024 | 53
JPMorgan
U.S. Small Company Fund
(continued)
The Fund is
subject to management risk and may not achieve its objective if the adviser’s
expectations regarding particular instruments or markets are not
met.
An
investment in this Fund or any other fund may not provide a complete investment
program. The suitability of an investment in the Fund should be considered based
on the investment objective, strategies and risks described in this Prospectus,
considered in light of all of the other investments in your portfolio, as well
as your risk tolerance, financial goals and time horizons. You may want to
consult with a financial advisor to determine if this Fund is suitable for
you.
The Fund is
subject to the main risks noted below, any of which may adversely affect the
Fund’s performance and ability to meet its investment
objective.
54 | J.P.
Morgan U.S. Equity Funds
November
1, 2024 | 55
JPMorgan
U.S. Small Company Fund
(continued)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
|
Past
1
Year |
Past
5
Years |
Past
10
Years |
|
CLASS
I SHARES |
|
|
|
|
Return
Before Taxes |
% |
% |
% |
|
Return
After Taxes on Distributions |
|
|
|
|
Return
After Taxes on Distributions and
Sale
of Fund Shares |
|
|
|
|
CLASS
A SHARES |
|
|
|
|
Return
Before Taxes |
|
|
|
|
CLASS
C SHARES |
|
|
|
|
Return
Before Taxes |
|
|
|
|
RUSSELL
3000 INDEX1
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
|
|
|
|
RUSSELL
2000 INDEX
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
|
|
|
1
56 | J.P.
Morgan U.S. Equity Funds
Management
J.P. Morgan
Investment Management Inc. (the adviser)
|
Portfolio
Manager |
Managed
the
Fund
Since |
Primary
Title with
Investment
Adviser |
|
Phillip
D. Hart |
2010 |
Managing
Director |
|
Wonseok
Choi |
2019 |
Managing
Director |
|
Akash
Gupta |
2019 |
Executive
Director |
|
Robert
A. Ippolito |
2022 |
Executive
Director |
Purchase
and Sale of Fund Shares
Purchase
minimums
|
For
Class A and Class C Shares |
|
|
To
establish an account |
$1,000 |
|
To
add to an account |
$50 |
|
For
Class I Shares |
|
|
To
establish an account |
$1,000,000 |
|
To
add to an account |
No
minimum levels |
In general,
you may purchase or redeem shares on any business day:
●
Through your
Financial Intermediary
●
By writing to
J.P. Morgan Funds Services, P.O. Box 219143, Kansas City, MO
64121-9143
●
After you
open an account, by calling J.P. Morgan Funds Services at
1-800-480-4111
Tax
Information
The Fund
intends to make distributions that may be taxed as ordinary income or capital
gains, except when your investment is in an IRA, 401(k) plan or other
tax-advantaged investment plan, in which case you may be subject to federal
income tax upon withdrawal from the tax-advantaged investment
plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If you
purchase shares of the Fund through a broker-dealer or other financial
intermediary (such as a bank), the Fund and its related companies may pay the
financial intermediary for the sale of Fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
financial intermediary and your salesperson to recommend the Fund over another
investment. Ask your salesperson or visit your financial intermediary’s website
for more information.
November
1, 2024 | 57
JPMorgan
U.S. Small Company Fund
|
| |
|
|
Class
L |
|
Management
Fees |
|
|
Distribution
(Rule 12b-1) Fees |
|
|
Other
Expenses |
|
|
Service
Fees |
|
|
Remainder
of Other Expenses |
|
|
Total
Annual Fund Operating Expenses |
|
|
| ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
L SHARES ($) |
|
|
|
|
58 | J.P.
Morgan U.S. Equity Funds
The Fund is
subject to management risk and may not achieve its objective if the adviser’s
expectations regarding particular instruments or markets are not
met.
An
investment in this Fund or any other fund may not provide a complete investment
program. The suitability of an investment in the Fund should be considered based
on the investment objective, strategies and risks described in this Prospectus,
considered in light of all of the other investments in your portfolio, as well
as your risk tolerance, financial goals and time horizons. You may want to
consult with a financial advisor to determine if this Fund is suitable for
you.
The Fund is
subject to the main risks noted below, any of which may adversely affect the
Fund’s performance and ability to meet its investment
objective.
November
1, 2024 | 59
JPMorgan
U.S. Small Company Fund
(continued)
60 | J.P.
Morgan U.S. Equity Funds
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
|
Past
1
Year |
Past
5
Years |
Past
10
Years |
|
CLASS
L SHARES |
|
|
|
|
Return
Before Taxes |
% |
% |
% |
|
Return
After Taxes on Distributions |
|
|
|
|
Return
After Taxes on Distributions and
Sale
of Fund Shares |
|
|
|
|
RUSSELL
3000 INDEX1
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
|
|
|
|
RUSSELL
2000 INDEX
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
|
|
|
1
Management
J.P. Morgan
Investment Management Inc. (the adviser)
|
Portfolio
Manager |
Managed
the
Fund
Since |
Primary
Title with
Investment
Adviser |
|
Phillip
D. Hart |
2010 |
Managing
Director |
|
Wonseok
Choi |
2019 |
Managing
Director |
|
Akash
Gupta |
2019 |
Executive
Director |
|
Robert
A. Ippolito |
2022 |
Executive
Director |
Purchase
and Sale of Fund Shares
Class L
Shares of the Fund are no longer generally available to new purchasers. Existing
Class L shareholders can still purchase additional shares, reinvest their
dividends and exchange into the Class L Shares from Class L Shares of other J.P.
Morgan Funds. In addition, certain group employer benefit plans, certain
fee-based advisory programs, college savings plans and other J.P. Morgan Funds
can continue to purchase shares as described in “Investing with J.P. Morgan
Funds — FUNDS SUBJECT TO A LIMITED OFFERING” in the
prospectus.
Purchase
minimums
|
For
Class L Shares |
|
|
To
establish an account |
$3,000,000 |
|
To
add to an account |
No
minimum levels |
In general,
you may purchase or redeem shares on any business day:
●
Through your
Financial Intermediary
●
By writing to
J.P. Morgan Funds Services, P.O. Box 219143, Kansas City, MO
64121-9143
●
After you
open an account, by calling J.P. Morgan Funds Services at
1-800-480-4111
Tax
Information
The Fund
intends to make distributions that may be taxed as ordinary income or capital
gains, except when your investment is in an IRA, 401(k) plan or other
tax-advantaged investment plan, in which case you may be subject to federal
income tax upon withdrawal from the tax-advantaged investment
plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If you
purchase shares of the Fund through a broker-dealer or other financial
intermediary (such as a bank), the Fund and its related companies may pay the
financial intermediary for the sale of Fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
financial intermediary and your salesperson to recommend the Fund over another
investment. Ask your salesperson or visit your financial intermediary’s website
for more information.
November
1, 2024 | 61
JPMorgan
Value Advantage Fund
|
| |||
|
|
Class
A |
Class
C |
Class
I |
|
Maximum
Sales Charge (Load)
Imposed
on Purchases, as % of the
Offering
Price |
|
|
|
|
Maximum
Deferred Sales Charge
(Load),
as % of Original Cost of the
Shares |
1
|
|
|
1
|
| |||
|
|
Class
A |
Class
C |
Class
I |
|
Management
Fees |
|
|
|
|
Distribution
(Rule 12b-1)
Fees |
|
|
|
|
Other
Expenses |
|
|
|
|
Service
Fees |
|
|
|
|
Remainder
of Other
Expenses |
|
|
|
|
Total
Annual Fund Operating
Expenses |
|
|
|
|
Fee
Waivers and/or Expense
Reimbursements
1 |
- |
- |
- |
|
Total
Annual Fund Operating
Expenses
after Fee Waivers
and/or
Expense Reimburse-
ments
1 |
|
|
|
1
|
| ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
A SHARES ($) |
|
|
|
|
|
CLASS
C SHARES ($) |
|
|
|
|
|
CLASS
I SHARES ($) |
|
|
|
|
|
| ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
A SHARES ($) |
|
|
|
|
|
CLASS
C SHARES ($) |
|
|
|
|
|
CLASS
I SHARES ($) |
|
|
|
|
62 | J.P.
Morgan U.S. Equity Funds
The Fund is
subject to management risk and may not achieve its objective if the adviser’s
expectations regarding particular instruments or markets are not
met.
An
investment in this Fund or any other fund may not provide a complete investment
program. The suitability of an investment in the Fund should be considered based
on the investment objective, strategies and risks described in this Prospectus,
considered in light of all of the other investments in your portfolio, as well
as your risk tolerance, financial goals and time horizons. You may want to
consult with a financial advisor to determine if this Fund is suitable for
you.
The Fund is
subject to the main risks noted below, any of which may adversely affect the
Fund’s performance and ability to meet its investment objective.
November
1, 2024 | 63
JPMorgan
Value Advantage Fund
(continued)
64 | J.P.
Morgan U.S. Equity Funds
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
| |||
|
|
Past
1
Year |
Past
5
Years |
Past
10
Years |
|
CLASS
A SHARES |
|
|
|
|
Return
Before Taxes |
% |
% |
% |
|
Return
After Taxes on Distributions |
|
|
|
|
Return
After Taxes on Distributions and
Sale
of Fund Shares |
|
|
|
|
CLASS
C SHARES |
|
|
|
|
Return
Before Taxes |
|
|
|
|
CLASS
I SHARES |
|
|
|
|
Return
Before Taxes |
|
|
|
|
RUSSELL
3000 INDEX1
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
|
|
|
|
RUSSELL
3000 VALUE INDEX
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
|
|
|
1
Management
J.P. Morgan
Investment Management Inc. (the adviser)
|
Portfolio
Manager |
Managed
the
Fund
Since |
Primary
Title with
Investment
Adviser |
|
Jonathan
K.L. Simon* |
2005 |
Managing
Director |
|
Scott
Blasdell |
2024 |
Managing
Director |
|
Graham
Spence |
2020 |
Executive
Director |
* Mr. Simon will retire from
JPMIM effective early 2025. Until his retirement, Mr. Simon will continue to
serve on the portfolio management team and upon his retirement Messrs. Blasdell
and Spence will continue to be responsible for the management of the
Fund.
November
1, 2024 | 65
JPMorgan
Value Advantage Fund
(continued)
Purchase
and Sale of Fund Shares
Purchase
minimums
|
For
Class A and Class C Shares |
|
|
To
establish an account |
$1,000 |
|
To
add to an account |
$50 |
|
For
Class I Shares |
|
|
To
establish an account |
$1,000,000 |
|
To
add to an account |
No
minimum levels |
In general,
you may purchase or redeem shares on any business day:
●
Through your
Financial Intermediary
●
By writing to
J.P. Morgan Funds Services, P.O. Box 219143, Kansas City, MO
64121-9143
●
After you
open an account, by calling J.P. Morgan Funds Services at
1-800-480-4111
Tax
Information
The Fund
intends to make distributions that may be taxed as ordinary income or capital
gains, except when your investment is in an IRA, 401(k) plan or other
tax-advantaged investment plan, in which case you may be subject to federal
income tax upon withdrawal from the tax-advantaged investment
plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If you
purchase shares of the Fund through a broker-dealer or other financial
intermediary (such as a bank), the Fund and its related companies may pay the
financial intermediary for the sale of Fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
financial intermediary and your salesperson to recommend the Fund over another
investment. Ask your salesperson or visit your financial intermediary’s website
for more information.
66 | J.P.
Morgan U.S. Equity Funds
JPMorgan
Value Advantage Fund
|
| |
|
|
Class
L |
|
Management
Fees |
|
|
Distribution
(Rule 12b-1) Fees |
|
|
Other
Expenses |
|
|
Service
Fees |
|
|
Remainder
of Other Expenses |
|
|
Total
Annual Fund Operating Expenses |
|
|
| ||||
|
|
1
Year |
3
Years |
5
Years |
10
Years |
|
CLASS
L SHARES ($) |
|
|
|
|
The Fund is
subject to management risk and may not achieve its objective if the adviser’s
expectations regarding particular instruments or markets are not
met.
November
1, 2024 | 67
JPMorgan
Value Advantage Fund
(continued)
An
investment in this Fund or any other fund may not provide a complete investment
program. The suitability of an investment in the Fund should be considered based
on the investment objective, strategies and risks described in this Prospectus,
considered in light of all of the other investments in your portfolio, as well
as your risk tolerance, financial goals and time horizons. You may want to
consult with a financial advisor to determine if this Fund is suitable for
you.
The Fund is
subject to the main risks noted below, any of which may adversely affect the
Fund’s performance and ability to meet its investment
objective.
68 | J.P.
Morgan U.S. Equity Funds
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
November
1, 2024 | 69
JPMorgan
Value Advantage Fund
(continued)
|
| |||
|
|
Past
1
Year |
Past
5
Years |
Past
10
Years |
|
CLASS
L SHARES |
|
|
|
|
Return
Before Taxes |
% |
% |
% |
|
Return
After Taxes on Distributions |
|
|
|
|
Return
After Taxes on Distributions and
Sale
of Fund Shares |
|
|
|
|
RUSSELL
3000 INDEX1
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
|
|
|
|
RUSSELL
3000 VALUE INDEX
(Reflects
No Deduction for Fees,
Expenses,
or Taxes) |
|
|
|
1
Management
J.P. Morgan
Investment Management Inc. (the adviser)
|
Portfolio
Manager |
Managed
the
Fund
Since |
Primary
Title with
Investment
Adviser |
|
Jonathan
K.L. Simon* |
2005 |
Managing
Director |
|
Scott
Blasdell |
2024 |
Managing
Director |
|
Graham
Spence |
2020 |
Executive
Director |
* Mr. Simon will retire from
JPMIM effective early 2025. Until his retirement, Mr. Simon will continue to
serve on the portfolio management team and upon his retirement Messrs. Blasdell
and Spence will continue to be responsible for the management of the
Fund.
Purchase
and Sale of Fund Shares
Class L
Shares of the Fund are no longer generally available to new purchasers. Existing
Class L shareholders can still purchase additional shares, reinvest their
dividends and exchange into
the Class L
Shares from Class L Shares of other J.P. Morgan Funds. In addition, certain
group employer benefit plans, certain fee-based advisory programs, college
savings plans and other J.P. Morgan Funds can continue to purchase shares as
described in “Investing with J.P. Morgan Funds — FUNDS SUBJECT TO A LIMITED
OFFERING” in the prospectus.
Purchase
minimums
|
For
Class L Shares |
|
|
To
establish an account |
$3,000,000 |
|
To
add to an account |
No
minimum levels |
In general,
you may purchase or redeem shares on any business day:
●
Through your
Financial Intermediary
●
By writing to
J.P. Morgan Funds Services, P.O. Box 219143, Kansas City, MO
64121-9143
●
After you
open an account, by calling J.P. Morgan Funds Services at
1-800-480-4111
Tax
Information
The Fund
intends to make distributions that may be taxed as ordinary income or capital
gains, except when your investment is in an IRA, 401(k) plan or other
tax-advantaged investment plan, in which case you may be subject to federal
income tax upon withdrawal from the tax-advantaged investment
plan.
Payments
to Broker-Dealers and Other Financial Intermediaries
If you
purchase shares of the Fund through a broker-dealer or other financial
intermediary (such as a bank), the Fund and its related companies may pay the
financial intermediary for the sale of Fund shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or
financial intermediary and your salesperson to recommend the Fund over another
investment. Ask your salesperson or visit your financial intermediary’s website
for more information.
70 | J.P.
Morgan U.S. Equity Funds
More
About the Funds
Additional
Information About the Funds’ Investment Strategies
Each
of the Funds
Each Fund
will invest primarily in equity securities as described below. Each Fund invests
in common
stock as a main
strategy. Although not a main strategy, a Fund’s investment in equity securities
may also include:
●
preferred
securities
●
convertible
securities
●
trust or
partnership interests
●
warrants and
rights to buy common stock
●
equity
securities purchased in initial public offerings
●
master
limited partnerships.
All of these
securities may be included as equity securities for the purpose of calculating a
Fund’s 80% policy.
The following
investments may be part of a Fund’s main investment strategies:
●
real estate
investment trusts (REITs) which are pooled vehicles which invest primarily in
income-producing real estate or loans related to real estate
●
derivatives,
including futures contracts, options and swaps. In connection with its main
investment strategies, a Fund may use futures to more effectively gain targeted
equity exposure from its cash position. Each Fund is also permitted to use
derivatives such as futures, options and swaps in order to hedge various
investments and for risk management. Under certain market conditions, a Fund’s
use of derivatives for cash management or other investment management purposes
could be significant.
Although not
main strategies, the Funds may also utilize the following, some of which may be
equity securities:
●
other
investment companies
●
exchange-traded
funds (ETFs)
●
affiliated
money market funds
●
foreign
securities, often in the form of depositary receipts
●
securities
lending.
ETFs, which
are pooled investment vehicles whose ownership interests are purchased and sold
on a securities exchange, may be passively or actively managed. Passively
managed ETFs generally seek to track the performance of a particular market
index, including broad-based market indexes, as well as indexes relating to
particular sectors, markets, regions or industries. Actively managed ETFs do not
seek to track the performance of a particular market index. Ordinarily, a Fund
must not hold more than 3% of the total assets of another ETF or other
investment company and must limit its investments in a single ETF to 5% of its
total assets and in all ETFs and other investment companies to 10% of its total
assets. The Securities and Exchange Commission adopted an exemptive rule that
allows any fund to disregard these 3%, 5% and 10% limitations, subject to
certain conditions. The price movement of an index-based ETF may not track the
underlying index and may result in a loss. In addition, ETFs may trade at a
price above (premium) or below (discount) their net asset value, especially
during periods of significant market volatility or stress, causing investors to
pay or receive significantly more or less than the value of the ETF’s underlying
portfolio when they purchase or sell their ETF shares, respectively.
The Funds
will provide shareholders with at least 60 days’ prior notice of any change in
their 80% investment policies as described below.
The frequency
with which each Fund buys and sells securities will vary from year to year,
depending on market conditions.
The name, investment
objective and policies of a Fund may be similar to other funds advised by the
adviser or its affiliates. However, the investment results of a Fund may be
higher or lower than, and there is no guarantee that the investment results of
the Fund will be comparable to, any other of these funds. A new fund or a fund
with fewer assets under management may be more significantly affected by
purchases and redemptions of its shares than a fund with relatively greater
assets under management would be affected by purchases and redemptions of its
shares. As compared to a larger fund, a new or smaller fund is more likely to
sell a comparatively large portion of its portfolio to meet significant
redemptions, or invest a comparatively large amount of cash to facilitate
purchases, in each case when a fund otherwise would not seek to do so. Such
transactions may cause funds to make investment decisions at inopportune times
or prices or miss attractive investment opportunities. Such transactions may
also accelerate the realization of taxable income if sales of securities
resulted in gains and a fund redeems shares for cash, or otherwise cause a fund
to perform differently than intended. While such risks may apply to funds of any
size, such risks are heightened in funds with fewer assets under management. In
addition, new funds may not be able to fully implement their investment strategy
immediately upon commencing investment operations, which could reduce investment
performance.
November
1, 2024 | 71
More
About the Funds
(continued)
|
FUNDAMENTAL
INVESTMENT OBJECTIVES |
|
An
investment objective is fundamental if it cannot be changed without the
consent of a majority of the outstanding shares of the
Fund.
The investment objectives for Mid Cap Growth Fund, Small Cap Blend Fund,
Small Cap Growth Fund, Small Cap Value Fund and
SMID
Cap Equity Fund are fundamental. The investment objectives for the
remaining Funds can be changed without the consent of a
majority
of the outstanding shares of that
Fund. |
Securities
Lending. Each Fund
may engage in securities lending to increase its income. Securities lending
involves the lending of securities owned by a Fund to financial institutions
such as certain broker-dealers in exchange for cash collateral. The Fund will
invest cash collateral in one or more money market funds advised by the adviser
or its affiliates and from which the adviser or its affiliates may receive fees.
During the term of the loan, the Fund is entitled to receive amounts equivalent
to distributions paid on the loaned securities as well as the return on the cash
collateral investments. Upon termination of the loan, the Fund is required to
return the cash collateral to the borrower plus any agreed upon rebate. Cash
collateral investments will be subject to market depreciation or appreciation,
and a Fund will be responsible for any loss that might result from its
investment of cash collateral. If the adviser determines to make securities
loans, the value of the securities loaned may not exceed 33 1∕3% of the
value of total assets of a Fund. Loan collateral (including any investment of
that collateral) is not subject to the percentage limitations regarding a Fund’s
investments described elsewhere in this prospectus.
Growth
Advantage Fund
The Fund will
invest primarily in common stocks of companies across all market
capitalizations. The Fund may at any given time invest a significant portion of
its assets in companies of one particular market capitalization category, such
as large capitalization companies.
Derivatives,
which are instruments that have a value based on another instrument, exchange
rate or index, may be used as substitutes for securities in which the Fund can
invest. To the extent the Fund uses derivatives, the Fund will primarily use
futures contracts to more effectively gain targeted equity exposure from its
cash positions.
Investment
Process: The Fund invests in companies that the adviser believes have strong
earnings growth potential. In managing the Fund, the adviser employs a process
that combines research, valuation and stock selection to identify companies that
have a history of above-average growth or which the adviser believes will
achieve above-average growth in the future. Growth companies purchased for the
Fund include those with leading competitive positions that can achieve
sustainable growth.
The adviser
also integrates financially material ESG factors as part of the Fund’s
investment process (ESG Integration). ESG Integration is the systematic
inclusion of ESG issues in investment analysis and investment decisions. As part
of its investment process, the adviser seeks to assess the impact of
environmental, social and governance factors on many issuers in the universe in
which the Fund may invest. The adviser’s assessment is based on an analysis of
key opportunities and risks across industries to seek to identify financially
material issues with respect to the Fund’s investments in securities and
ascertain key issues that merit engagement with issuers. These assessments may
not be conclusive and securities of issuers that may be negatively impacted by
such factors may be purchased and retained by the Fund while the Fund may divest
or not invest in securities of issuers that may be positively impacted by such
factors. In particular, ESG Integration does not change a Fund’s investment
objective, exclude specific types of industries or companies or limit the Fund’s
investable universe. The Fund is not designed for investors who wish to screen
out particular types of companies or investments or are looking for Funds that
meet specific ESG goals.
The adviser
may sell a security for several reasons. A security may be sold due to a change
in the company’s fundamentals or if the adviser believes the security is no
longer attractively valued. Investments may also be sold if the adviser
identifies a stock that it believes offers a better investment
opportunity.
Mid
Cap Equity Fund
Under normal circumstances,
the Fund invests at least 80% of its Assets in equity securities of mid cap
companies. “Assets” means net assets, plus the amount of borrowings for
investment purposes. Mid cap companies are companies with market capitalizations
equal to those within the universe of the Russell Midcap®
Index at the
time of purchase. As of the reconstitution of the Russell Midcap Index on
September 30, 2024, the market capitalizations of the companies in the index
ranged from $201.16 million to $74.71 billion. In implementing its main
strategies, the Fund invests primarily in common stocks and real estate
investment trusts (REITs).
Derivatives,
which are instruments that have a value based on another instrument, exchange
rate or index, may be used as substitutes for securities in which the Fund can
invest. To the extent the Fund uses derivatives, the Fund will primarily use
futures contracts to more effectively gain targeted equity exposure from its
cash positions.
72 | J.P.
Morgan U.S. Equity Funds
Investment
Process: In managing the Fund, the portfolio management team employs an
investment process that seeks to identify both growth and value securities for
the Fund. The team seeks to identify companies with leading competitive
positions, talented management teams and durable business models. In addition,
the team will invest in companies that it believes either have the capacity to
achieve a sustainable level of above average growth or have sustainable free
cash flow generation with management committed to increasing shareholder value.
The adviser also integrates financially material ESG factors as part of the
Fund’s investment process (ESG Integration). ESG Integration is the systematic
inclusion of ESG issues in investment analysis and investment decisions. As part
of its investment process, the adviser seeks to assess the impact of
environmental, social and governance factors on many issuers in the universe in
which the Fund may invest. The adviser’s assessment is based on an analysis of
key opportunities and risks across industries to seek to identify financially
material issues with respect to the Fund’s investments in securities and
ascertain key issues that merit engagement with issuers. These assessments may
not be conclusive and securities of issuers that may be negatively impacted by
such factors may be purchased and retained by the Fund while the Fund may divest
or not invest in securities of issuers that may be positively impacted by such
factors. In particular, ESG Integration does not change a Fund’s investment
objective, exclude specific types of industries or companies or limit the Fund’s
investable universe. The Fund is not designed for investors who wish to screen
out particular types of companies or investments or are looking for Funds that
meet specific ESG goals.
The adviser
may sell a security for several reasons. A security may be sold due to a change
in the company’s fundamentals or if the adviser believes the security is no
longer attractively valued. Investments may also be sold if the adviser
identifies a stock that it believes offers a better investment
opportunity.
Mid
Cap Growth Fund
Under normal circumstances,
at least 80% of the Fund’s Assets will be invested in equity securities of mid
cap companies, including common stocks and debt securities and preferred
securities that are convertible to common stocks. “Assets” means net assets,
plus the amount of borrowings for investment purposes. In implementing its main
strategies, the Fund invests primarily in common stocks of mid cap companies
which the Fund’s adviser believes are capable of achieving sustained growth. Mid
cap companies are companies with market capitalizations similar to those within
the universe of the Russell Midcap®Growth Index at the time of
purchase. As of the reconstitution of the Russell Midcap Growth Index on
September 30, 2024, the market capitalizations of the companies in the index
ranged from $57.58 million to $74.71 billion.
Derivatives,
which are instruments that have a value based on another instrument, exchange
rate or index, may be used as substitutes for securities in which the Fund can
invest. To the extent the Fund uses derivatives, the Fund will primarily use
futures contracts to more effectively gain targeted equity exposure from its
cash positions.
Investment
Process: In managing the Fund, the adviser employs a process that combines
research, valuation and stock selection to identify companies that have a
history of above-average growth or which the adviser believes will achieve
above-average growth in the future. Growth companies purchased for the Fund
include those with leading competitive positions that can achieve sustainable
growth. The adviser also integrates financially material ESG factors as part of
the Fund’s investment process (ESG Integration). ESG Integration is the
systematic inclusion of ESG issues in investment analysis and investment
decisions. As part of its investment process, the adviser seeks to assess the
impact of environmental, social and governance factors on many issuers in the
universe in which the Fund may invest. The adviser’s assessment is based on an
analysis of key opportunities and risks across industries to seek to identify
financially material issues with respect to the Fund’s investments in securities
and ascertain key issues that merit engagement with issuers. These assessments
may not be conclusive and securities of issuers that may be negatively impacted
by such factors may be purchased and retained by the Fund while the Fund may
divest or not invest in securities of issuers that may be positively impacted by
such factors. In particular, ESG Integration does not change a Fund’s investment
objective, exclude specific types of industries or companies or limit the Fund’s
investable universe. The Fund is not designed for investors who wish to screen
out particular types of companies or investments or are looking for Funds that
meet specific ESG goals.
The adviser
may sell a security for several reasons. A security may be sold due to a change
in the company’s fundamentals or if the adviser believes the security is no
longer attractively valued. Investments may also be sold if the adviser
identifies a stock that it believes offers a better investment
opportunity.
Mid
Cap Value Fund
Under normal circumstances,
the Fund invests at least 80% of its Assets in equity securities of mid cap
companies. “Assets” means net assets, plus the amount of borrowings for
investment purposes. Mid cap companies are companies with market capitalizations
equal to those within the universe of the Russell Midcap® Value Index at the time of
purchase. As of the reconstitution of the Russell Midcap Value Index on
September 30, 2024, the market capitalizations of the companies in the index
ranged from $71.53 million to $62.27 billion. In implementing its main
strategies, the Fund’s investments are primarily in common stocks and real
estate investment trusts (REITs).
November
1, 2024 | 73
More
About the Funds
(continued)
Derivatives,
which are instruments that have a value based on another instrument, exchange
rate or index, may be used as substitutes for securities in which the Fund can
invest. To the extent the Fund uses derivatives, the Fund will primarily use
futures contracts to more effectively gain targeted equity exposure from its
cash positions.
Investment
Process: In managing the Fund, the adviser employs a bottom-up approach to stock
selection, constructing portfolios based on company fundamentals, quantitative
screening and proprietary fundamental analysis. The adviser looks for quality
companies, which appear to be attractively valued and have the potential to grow
intrinsic value per share. Quality companies generally have a sustainable
competitive position, relatively lower levels of business cyclicality, high
returns on invested capital and strong experienced management teams.
The adviser
also integrates financially material ESG factors as part of the Fund’s
investment process (ESG Integration). ESG Integration is the systematic
inclusion of ESG issues in investment analysis and investment decisions. As part
of its investment process, the adviser seeks to assess the impact of
environmental, social and governance factors on many issuers in the universe in
which the Fund may invest. The adviser’s assessment is based on an analysis of
key opportunities and risks across industries to seek to identify financially
material issues with respect to the Fund’s investments in securities and
ascertain key issues that merit engagement with issuers. These assessments may
not be conclusive and securities of issuers that may be negatively impacted by
such factors may be purchased and retained by the Fund while the Fund may divest
or not invest in securities of issuers that may be positively impacted by such
factors. In particular, ESG Integration does not change a Fund’s investment
objective, exclude specific types of industries or companies or limit the Fund’s
investable universe. The Fund is not designed for investors who wish to screen
out particular types of companies or investments or are looking for Funds that
meet specific ESG goals.
The adviser
may sell a security for several reasons. A security may be sold due to a change
in the company’s fundamentals or if the adviser believes the security is no
longer attractively valued. Investments may also be sold if the adviser
identifies a stock that it believes offers a better investment
opportunity.
Small
Cap Blend Fund
The Fund is a
small cap equity portfolio which is normally managed as a core portfolio, but
which has the ability to proactively invest more heavily in either growth or
value securities depending on market conditions and the convictions of the
adviser. The portfolio managers will consider various factors when making
overall allocation decisions for the Fund, including the relative attractiveness
of growth and value securities and the relative valuations and fundamentals of
companies in the small cap growth and value universes. Based on these
considerations, the size of the allocation of the Fund to either growth or value
securities may range from 30 to 70 percent of the Fund.
Under normal circumstances,
the Fund invests at least 80% of its Assets in equity securities of small cap
companies. “Assets” means net assets, plus the amount of borrowings for
investment purposes. Small cap companies are companies with market
capitalizations equal to those within the universe of the Russell
2000® Index at the time of
purchase. As of the reconstitution of the Russell 2000 Index on September 30,
2024, the market capitalizations of the companies in the index ranged from $2.70
million to $13.51 billion. In implementing its main strategies, the Fund invests
primarily in common stocks and real estate investment trusts
(REITs).
Derivatives,
which are instruments that have a value based on another instrument, exchange
rate or index, may be used as substitutes for securities in which the Fund can
invest. To the extent the Fund uses derivatives, the Fund will primarily use
futures contracts to more effectively gain targeted equity exposure from its
cash positions.
Investment
Process: In managing the Fund, the Fund’s adviser seeks to outperform the Fund’s
benchmark. The adviser employs a fundamental bottom-up investment process that
combines research, valuation and stock selection to identify both growth and
value securities.
In selecting
growth securities, the adviser seeks to invest in companies that have a history
of above-average growth or that the adviser believes will achieve above-average
growth in the future. The adviser believes that investing in high quality growth
companies whose long-term growth rates are underappreciated by the market will
lead to attractive returns. Growth companies purchased for the Fund include
those with leading competitive positions, predictable and durable business
models and management that can achieve sustained growth.
In selecting
value securities, the adviser seeks to invest in companies which have durable
franchises and that the adviser believes to be attractively valued and to have
the ability to grow intrinsic value per share. Companies with durable franchises
generally have a sustainable competitive position relative to peers, high
returns on capital, a diversified client or asset base and a strong
brand.
The adviser
also integrates financially material ESG factors as part of the Fund’s
investment process (ESG Integration). ESG Integration is the systematic
inclusion of ESG issues in investment analysis and investment decisions. As part
of its investment process, the adviser seeks to assess the impact of
environmental, social and governance factors on many issuers in the universe in
which the Fund may invest. The adviser’s assessment is based on an analysis of
key opportunities and risks across industries to seek to identify financially
material issues with respect to the Fund’s investments in securities and
ascertain key issues that merit engagement with issuers. These assessments may
not be conclusive and securities of issuers that may be negatively impacted by
such factors may be
74 | J.P.
Morgan U.S. Equity Funds
purchased and
retained by the Fund while the Fund may divest or not invest in securities of
issuers that may be positively impacted by such factors. In particular, ESG
Integration does not change a Fund’s investment objective, exclude specific
types of industries or companies or limit the Fund’s investable universe. The
Fund is not designed for investors who wish to screen out particular types of
companies or investments or are looking for Funds that meet specific ESG
goals.
The adviser
may sell a security for several reasons. A security may be sold due to a change
in the company’s fundamentals or if the adviser believes the security is no
longer attractively valued. Investments may also be sold if the adviser
identifies a security that it believes offers a better investment opportunity or
to reallocate the Fund’s assets between growth and value
securities.
Small
Cap Equity Fund
Under normal circumstances,
the Fund invests at least 80% of its Assets in equity securities of small cap
companies. “Assets” means net assets, plus the amount of borrowings for
investment purposes. Small cap companies are companies with market
capitalizations equal to those within the universe of the Russell
2000®
Index at the
time of purchase. As of the reconstitution of the Russell 2000 Index on
September 30, 2024, the market capitalizations of the companies in the index
ranged from $2.70 million to $13.51 billion. In implementing its main
strategies, the Fund invests primarily in common stocks.
Derivatives,
which are instruments that have a value based on another instrument, exchange
rate or index, may be used as substitutes for securities in which the Fund can
invest. To the extent the Fund uses derivatives, the Fund will primarily use
futures contracts to more effectively gain targeted equity exposure from its
cash positions.
Investment
Process: In managing the Fund, the adviser employs a fundamental bottom-up
investment process. The adviser seeks to invest in attractively valued companies
with leading competitive positions and predictable and durable business models.
It also seeks companies whose management has a successful track record of
prudent capital allocation. The adviser also integrates financially material ESG
factors as part of the Fund’s investment process (ESG Integration). ESG
Integration is the systematic inclusion of ESG issues in investment analysis and
investment decisions. As part of its investment process, the adviser seeks to
assess the impact of environmental, social and governance factors on many
issuers in the universe in which the Fund invests. The adviser’s assessment is
based on an analysis of key opportunities and risks across industries to seek to
identify financially material issues with respect to the Fund’s investments in
securities and ascertain key issues that merit engagement with issuers. These
assessments may not be conclusive and securities of issuers that may be
negatively impacted by such factors may be purchased and retained by the Fund
while the Fund may divest or not invest in securities of issuers that may be
positively impacted by such factors. In particular, ESG Integration does not
change a Fund’s investment objective, exclude specific types of industries or
companies or limit the Fund’s investable universe. The Fund is not designed for
investors who wish to screen out particular types of companies or investments or
are looking for Funds that meet specific ESG goals.
The adviser
may sell a security for several reasons. A security may be sold due to a change
in the company’s fundamentals or if the adviser believes the security is no
longer attractively valued. Investments may also be sold if the adviser
identifies a stock that it believes offers a better investment
opportunity.
Small
Cap Growth Fund
Under normal circumstances,
at least 80% of the Fund’s Assets will be invested in the securities of small
capitalization companies. “Assets” means net assets, plus the amount of
borrowings for investment purposes. Small cap companies are companies with
market capitalizations equal to those within the universe of the Russell
2000®Growth Index at the time of
purchase. As of the reconstitution of the Russell 2000 Growth Index on September
30, 2024, the market capitalizations of the companies in the index ranged from
$1.19 million to $13.51 billion. In implementing its main strategies, the Fund
will invest primarily in common stocks. Typically, the Fund invests in
securities of companies with a history of above-average growth, as well as
companies expected to have above-average growth.
Derivatives,
which are instruments that have a value based on another instrument, exchange
rate or index, may be used as substitutes for securities in which the Fund can
invest. To the extent the Fund uses derivatives, the Fund will primarily use
futures contracts to more effectively gain targeted equity exposure from its
cash positions.
Investment
Process: In managing the Fund, the adviser employs a process that combines
research, valuation and stock selection to identify companies that have a
history of above-average growth or which the adviser believes will achieve
above-average growth in the future. Growth companies purchased for the Fund
include those with leading competitive positions that can achieve sustainable
growth. The adviser also integrates financially material ESG factors as part of
the Fund’s investment process (ESG Integration). ESG Integration is the
systematic inclusion of ESG issues in investment analysis and investment
decisions. As part of its investment process, the adviser seeks to assess the
impact of environmental, social and governance factors on many issuers in the
universe in which the Fund may invest. The adviser’s assessment is based on an
analysis of key opportunities and risks across industries to seek
November
1, 2024 | 75
More
About the Funds
(continued)
to identify
financially material issues with respect to the Fund’s investments in securities
and ascertain key issues that merit engagement with issuers. These assessments
may not be conclusive and securities of issuers that may be negatively impacted
by such factors may be purchased and retained by the Fund while the Fund may
divest or not invest in securities of issuers that may be positively impacted by
such factors. In particular, ESG Integration does not change a Fund’s investment
objective, exclude specific types of industries or companies or limit the Fund’s
investable universe. The Fund is not designed for investors who wish to screen
out particular types of companies or investments or are looking for Funds that
meet specific ESG goals.
The adviser
may sell a security for several reasons. A security may be sold due to a change
in the company’s fundamentals or if the adviser believes the security is no
longer attractively valued. Investments may also be sold if the adviser
identifies a stock that it believes offers a better investment
opportunity.
Small Cap
Value Fund
Under normal circumstances,
the Fund invests at least 80% of its Assets in equity securities of small cap
companies. “Assets” means net assets, plus the amount of borrowings for
investment purposes. Small cap companies are companies with market
capitalizations equal to those within the universe of the Russell
2000® Value Index at the time of
purchase. As of the reconstitution of the Russell 2000 Value Index on September
30, 2024, the market capitalizations of the companies in the index ranged from
$0.70 million to $7.32 billion. In reviewing investment opportunities for the
Fund, its adviser uses a value-oriented approach. In implementing its main
strategies, the Fund’s equity investments are primarily in common stocks and
real estate investment trusts (REITs).
Derivatives,
which are instruments that have a value based on another instrument, exchange
rate or index, may be used as substitutes for securities in which the Fund can
invest. The Fund may use futures contracts to gain or reduce exposure to its
index, maintain liquidity and minimize transaction costs. In managing cash
flows, the Fund buys futures contracts to invest incoming cash in the market or
sells futures contracts in response to cash outflows, thereby gaining market
exposure to the index while maintaining a cash balance for
liquidity.
Investment
Process: In managing the Fund, the adviser employs a process that ranks stocks
based on its proprietary stock ranking system. The rankings are then reviewed
and adjusted utilizing fundamental research conducted by the investment team to
enhance accuracy and consistency. The adjusted rankings are used to place stocks
into portfolios. The adviser also integrates financially material ESG factors as
part of the Fund’s investment process (ESG Integration). ESG Integration is the
systematic inclusion of ESG issues in investment analysis and investment
decisions. As part of its investment process, the adviser seeks to assess the
impact of environmental, social and governance factors on many issuers in the
universe in which the Fund may invest. The adviser’s assessment is based on an
analysis of key opportunities and risks across industries to seek to identify
financially material issues with respect to the Fund’s investments in securities
and ascertain key issues that merit engagement with issuers. These assessments
may not be conclusive and securities of issuers that may be negatively impacted
by such factors may be purchased and retained by the Fund while the Fund may
divest or not invest in securities of issuers that may be positively impacted by
such factors. In particular, ESG Integration does not change a Fund’s investment
objective, exclude specific types of industries or companies or limit the Fund’s
investable universe. The Fund is not designed for investors who wish to screen
out particular types of companies or investments or are looking for Funds that
meet specific ESG goals. In general, stocks are purchased when they are among
the top ranked within their sector. Stocks become candidates for sale when their
ranking falls, when they appear unattractive or when the company is no longer a
small cap company. The Fund may continue to hold the securities if it believes
further substantial growth is possible. Risk factor exposures are managed
through portfolio construction. Portfolio constraints control for sector
weights, position sizes and/or style characteristics of the
Fund.
SMID
Cap Equity Fund
Under normal circumstances,
at least 80% of the Fund’s Assets will be invested in equity securities of
small- to mid-cap companies. “Assets” means net assets, plus the amount of
borrowings for investment purposes. Small- to mid-cap companies are generally
considered to be those companies with market capitalizations similar to those
within the universe of the Russell 2500® Index at the time of
purchase. As of the reconstitution of the Russell 2500 Index on September 30,
2024, the market capitalizations of the companies in the index ranged from $2.70
million to $25.50 billion. In implementing its main strategies, the Fund invests
primarily in common stocks.
Derivatives,
which are instruments that have a value based on another instrument, exchange
rate or index, may be used as substitutes for securities in which the Fund can
invest. To the extent the Fund uses derivatives, the Fund will primarily use
futures contracts to more effectively gain targeted equity exposure from its
cash positions.
Investment
Process: In managing the Fund, the adviser employs a fundamental bottom-up
investment process and seeks to invest in attractively valued companies with
leading competitive positions and predictable and durable business models. It
also seeks to invest the Fund’s assets in companies whose management has a
successful track record of prudent capital allocation. The adviser also
76 | J.P.
Morgan U.S. Equity Funds
integrates
financially material ESG factors as part of the Fund’s investment process (ESG
Integration). ESG Integration is the systematic inclusion of ESG issues in
investment analysis and investment decisions. As part of its investment process,
the adviser seeks to assess the impact of environmental, social and governance
factors on many issuers in the universe in which the Fund may invest. The
adviser’s assessment is based on an analysis of key opportunities and risks
across industries to seek to identify financially material issues with respect
to the Fund’s investments in securities and ascertain key issues that merit
engagement with issuers. These assessments may not be conclusive and securities
of issuers that may be negatively impacted by such factors may be purchased and
retained by the Fund while the Fund may divest or not invest in securities of
issuers that may be positively impacted by such factors. In particular, ESG
Integration does not change a Fund’s investment objective, exclude specific
types of industries or companies or limit the Fund’s investable universe. The
Fund is not designed for investors who wish to screen out particular types of
companies or investments or are looking for Funds that meet specific ESG
goals.
The adviser
may sell a security for several reasons. A security may be sold due to a change
in a company’s fundamentals or if the adviser believes the security is no longer
attractively valued. Investments may also be sold if the adviser identifies a
stock that it believes offers a better investment
opportunity.
U.S.
Small Company Fund
Under normal circumstances,
the Fund invests at least 80% of its Assets in equity securities of small cap
U.S. companies. “Assets” means net assets, plus the amount of borrowings for
investment purposes. Small cap companies are companies with market
capitalizations similar to those within the universe of the Russell
2000® Index at the time of
purchase. As of the reconstitution of the Russell 2000 Index on September 30,
2024, the market capitalizations of the companies in the index ranged from $2.70
million to $13.51 billion. Sector by sector, the Fund’s weightings are similar
to those of the Russell 2000® Index. The Fund can
moderately underweight or overweight sectors when it believes it will benefit
performance. The Fund pursues returns that exceed those of the Russell
2000® Index while seeking to limit
its volatility relative to this index. In implementing its main strategies, the
Fund’s investments are primarily in common stocks and real estate investment
trusts (REITs).
Derivatives,
which are instruments that have a value based on another instrument, exchange
rate or index, may be used as substitutes for securities in which the Fund can
invest. The Fund may use futures contracts to gain or reduce exposure to its
index, maintain liquidity and minimize transaction costs. In managing cash
flows, the Fund buys futures contracts to invest incoming cash in the market or
sells futures contracts in response to cash outflows, thereby gaining market
exposure to the index while maintaining a cash balance for
liquidity.
Investment
Process: In managing the Fund, the adviser employs a process that ranks stocks
based on its proprietary stock ranking system. The rankings are then reviewed
and adjusted utilizing fundamental research conducted by the investment team to
enhance accuracy and consistency. The adjusted rankings are used to place stocks
into portfolios. The adviser also integrates financially material ESG factors as
part of the Fund’s investment process (ESG Integration). ESG Integration is the
systematic inclusion of ESG issues in investment analysis and investment
decisions. As part of its investment process, the adviser seeks to assess the
impact of environmental, social and governance factors on many issuers in the
universe in which the Fund may invest. The adviser’s assessment is based on an
analysis of key opportunities and risks across industries to seek to identify
financially material issues with respect to the Fund’s investments in securities
and ascertain key issues that merit engagement with issuers. These assessments
may not be conclusive and securities of issuers that may be negatively impacted
by such factors may be purchased and retained by the Fund while the Fund may
divest or not invest in securities of issuers that may be positively impacted by
such factors. In particular, ESG Integration does not change a Fund’s investment
objective, exclude specific types of industries or companies or limit the Fund’s
investable universe. The Fund is not designed for investors who wish to screen
out particular types of companies or investments or are looking for Funds that
meet specific ESG goals. In general, stocks are purchased when they are among
the top ranked within their sector. Stocks become candidates for sale when their
ranking falls, when they appear unattractive or when the company is no longer a
small cap company. The Fund may continue to hold the securities if it believes
further substantial growth is possible. Risk factor exposures are managed
through portfolio construction. Portfolio constraints control for sector
weights, position sizes and/or style characteristics of the
Fund.
An issuer of
a security will be deemed to be located in the United States if: (i) the
principal trading market for the security is in the United States, (ii) the
issuer is organized under the laws of the United States, or (iii) the issuer
derives at least 50% of its revenues or profits from the United States or has at
least 50% of its total assets situated in the United States.
Value
Advantage Fund
The Fund will
invest primarily in equity securities across all market capitalizations. The
Fund may at any given time invest a significant portion of its assets in
companies of one particular market capitalization category, such as
large-capitalization companies. Equity securities in which the Fund primarily
invests include common stocks and real estate investment trusts
(REITs).
November
1, 2024 | 77
More
About the Funds
(continued)
Derivatives,
which are instruments that have a value based on another instrument, exchange
rate or index, may be used as substitutes for securities in which the Fund can
invest. To the extent the Fund uses derivatives, the Fund will primarily use
futures contracts to more effectively gain targeted equity exposure from its
cash positions.
Investment
Process: In managing the Fund, the adviser employs a bottom-up approach to stock
selection, constructing portfolios based on company fundamentals and proprietary
fundamental analysis. The adviser’s aim is to identify attractively valued
companies that have the potential to grow their intrinsic values per share, and
to purchase these companies at a discount.
The adviser
also integrates financially material ESG factors as part of the Fund’s
investment process (ESG Integration). ESG Integration is the systematic
inclusion of ESG issues in investment analysis and investment decisions. As part
of its investment process, the adviser seeks to assess the impact of
environmental, social and governance factors on many issuers in the universe in
which the Fund may invest. The adviser’s assessment is based on an analysis of
key opportunities and risks across industries to seek to identify financially
material issues with respect to the Fund’s investments in securities and
ascertain key issues that merit engagement with issuers. These assessments may
not be conclusive and securities of issuers that may be negatively impacted by
such factors may be purchased and retained by the Fund while the Fund may divest
or not invest in securities of issuers that may be positively impacted by such
factors. In particular, ESG Integration does not change a Fund’s investment
objective, exclude specific types of industries or companies or limit the Fund’s
investable universe. The Fund is not designed for investors who wish to screen
out particular types of companies or investments or are looking for Funds that
meet specific ESG goals.
The adviser
may sell a security for several reasons. A security may be sold due to a change
in the company’s fundamentals or if the adviser believes the security is no
longer attractively valued. Investments may also be sold if the adviser
identifies a stock that it believes offers a better investment
opportunity.
The Value
Advantage Fund may sell covered call options as an additional strategy. When it
does so, the purchaser of the option has the right to buy that security at a
predetermined price (exercise price) during the life of the option. If the
purchaser exercises the option, the Fund must sell the stock to purchaser at the
exercise price. The option is “covered” because the Fund owns the stock at the
time it sells the option. As the seller of the option, the Fund receives a
premium from the purchaser of the call option, which may provide additional
returns to the Fund.
Small Cap
Equity Fund, SMID Cap Equity Fund, Small Cap Growth Fund and Small Cap Blend
Fund
While each Fund primarily
invests in small cap securities (or in the case of SMID Cap Equity Fund
small-to-mid cap securities) as defined above, each Fund may, to a limited
extent, buy, continue to hold, as well as make additional investments in, a
stock if it is above, or has appreciated beyond the market capitalization of the
largest company included in the Fund's index.
Investment
Risks
There can be
no assurance that each Fund will achieve its investment objective.
The main risks associated
with investing in each Fund are summarized in the “Risk/Return Summary” at the
front of this prospectus. In addition to each Fund’s main risks, each Fund may
be subject to additional risks in connection with investments and strategies
used by each Fund from time to time. The table below identifies main risks and
some of the additional risks for each Fund.
Please note
that each Fund also may use strategies that are not described herein, but which
are described in the Statement of Additional Information.
An
investment in a Fund or any other fund may not provide a complete investment
program. The suitability of an investment in a Fund should be considered based
on the investment objective, strategies and risks described in this prospectus,
considered in light of all of the other investments in your portfolio, as well
as your risk tolerance, financial goals and time horizons. You may want to
consult with a financial advisor to determine if a Fund is suitable for
you.
The Funds are
subject to the main risks designated as such in the table below, any of which
may adversely affect a Fund’s net asset value (NAV), market price, performance
and ability to meet its investment objective. Each Fund may also be subject to
additional risks that are noted in the table below, as well as those that are
not described herein but which are described in the Statement of Additional
Information.
78 | J.P.
Morgan U.S. Equity Funds
|
|
Growth
Advantage Fund |
Mid
Cap Equity Fund |
Mid
Cap Growth Fund |
Mid
Cap Value Fund |
Small
Cap Blend Fund |
Small
Cap Equity Fund |
Small
Cap Growth Fund |
Small
Cap Value Fund |
SMID
Cap Equity Fund |
U.S.
Small Company Fund |
Value
Advantage Fund |
|
Convertible
Securities Risk |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
|
Covered
Call Option Risk |
|
|
|
|
|
|
|
|
|
|
○ |
|
Cyber
Security Risk |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
|
Derivatives
Risk |
• |
• |
• |
• |
• |
• |
• |
• |
• |
• |
• |
|
Equity
Market Risk |
• |
• |
• |
• |
• |
• |
• |
• |
• |
• |
• |
|
Exchange-Traded
Fund (ETF) and Other Investment Company Risk |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
|
Financials
Sector Risk |
|
|
|
• |
|
• |
|
• |
• |
• |
• |
|
Foreign
Securities and Emerging Markets Risks |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
|
General
Market Risk |
• |
• |
• |
• |
• |
• |
• |
• |
• |
• |
• |
|
Growth
Investing Risk |
• |
|
• |
|
|
|
• |
|
|
|
|
|
Healthcare
Sector Risk |
|
|
• |
|
|
|
• |
|
|
• |
|
|
Industrials
Sector Risk |
|
|
• |
• |
• |
• |
• |
|
• |
• |
|
|
Industry
and Sector Focus Risk |
• |
• |
• |
• |
• |
• |
• |
• |
• |
• |
• |
|
Initial
Public Offering (IPO) Risk |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
|
Large
Cap Company Risk |
• |
|
|
|
|
|
|
|
|
|
• |
|
Master
Limited Partnerships (MLPs) Risk |
○ |
|
|
○ |
○ |
○ |
○ |
○ |
|
○ |
○ |
|
Preferred
Securities Risk |
○ |
|
|
○ |
○ |
○ |
○ |
○ |
|
○ |
○ |
|
Prepayment
Risk |
|
○ |
|
|
|
|
|
|
○ |
|
|
|
Real
Estate Securities Risk |
○ |
• |
○ |
• |
• |
○ |
○ |
• |
○ |
• |
• |
|
Regulatory
and Legal Risk |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
|
Securities
Lending Risk |
○ |
|
|
○ |
○ |
○ |
○ |
○ |
○ |
○ |
○ |
|
Short
Selling Risk |
|
○ |
○ |
|
|
|
|
|
|
|
|
|
Significant
Holdings Risk |
• |
|
|
|
|
|
|
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Smaller
and/or Mid-Sized Company Risk |
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Strategy
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Technology
Sector Risk |
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Transactions
and Liquidity Risk |
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Value
Investing Risk |
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Volcker
Rule Risk |
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Main
Risks
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Additional
Risks
Equity
Market Risk. The price of
equity securities may rise or fall, sometimes rapidly or unpredictably, because
of changes in the broad market or changes in a company’s financial condition.
These price movements may result from factors affecting individual companies,
sectors or industries selected for a Fund’s portfolio or the securities market
as a whole, such as changes in economic or political conditions. Equity
securities are subject to “stock market risk” meaning that stock prices in
general (or in particular, the prices of the types of securities in which a Fund
invests) may decline over short or extended periods of time. When the value of a
Fund’s portfolio securities goes down, your investment in that Fund decreases in
value.
November
1, 2024 | 79
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About the Funds
(continued)
General
Market Risk. Economies and
financial markets throughout the world are becoming increasingly interconnected,
which increases the likelihood that events or conditions in one country or
region will adversely impact markets or issuers in other countries or regions.
Securities in a Fund’s portfolio may underperform in comparison to securities in
general financial markets, a particular financial market or other asset classes
due to a number of factors, including inflation (or expectations for inflation),
deflation (or expectations for deflation), interest rates, global demand for
particular products or resources, market instability, financial system
instability, debt crises and downgrades, embargoes, tariffs, sanctions and other
trade barriers, regulatory events, other governmental trade or market control
programs and related geopolitical events. In addition, the value of a Fund’s
investments may be negatively affected by the occurrence of global events such
as war, terrorism, environmental disasters, natural disasters or events, country
instability, and infectious disease epidemics or pandemics.
The effects of any future
pandemic or other global event to public health and business and market
conditions may have a significant negative impact on the performance of a Fund’s
investments, increase a Fund’s volatility, exacerbate pre-existing political,
social and economic risks to a Fund, and negatively impact broad segments of
businesses and populations. In addition, governments, their regulatory agencies,
or self-regulatory organizations have taken or may take actions in response to a
pandemic or other global event that affect the instruments in which a Fund
invests, or the issuers of such instruments, in ways that could have a
significant negative impact on a Fund’s investment performance. The ultimate
impact of any pandemic or other global event and the extent to which the
associated conditions and governmental responses impact a Fund will also depend
on future developments, which are highly uncertain, difficult to accurately
predict and subject to frequent changes.
Growth
Investing Risk. Growth
investing attempts to identify companies that the adviser believes will
experience rapid earnings growth relative to value or other types of stocks. The
value of these stocks generally is much more sensitive to current or expected
earnings than stocks of other types of companies. Short-term events, such as a
failure to meet industry earnings expectations, can cause dramatic decreases in
the growth stock price compared to other types of stock. Growth stocks may also
trade at higher multiples of current earnings compared to value or other stocks,
leading to inflated prices and thus potentially greater declines in value. A
Fund’s performance may be better or worse than the performance of equity funds
that focus on value stocks or that have a broader investment
style.
Value
Investing Risk. Value
investing attempts to identify companies that, according to the adviser’s
estimate of their true worth, are undervalued or attractively valued. The
adviser selects stocks at prices that it believes are temporarily low relative
to factors such as the company’s earnings, cash flow or dividends. A value stock
may decrease in price or may not increase in price as anticipated by the adviser
if other investors fail to recognize the company’s value or the factors that the
adviser believes will cause the stock price to increase do not occur. A Fund’s
performance may be better or worse than the performance of equity funds that
focus on growth stocks or that have a broader investment
style.
Smaller
and/or Mid-Sized Company Risk. (Small Cap Company and/or
Mid Cap Company Risk). Investments in smaller and mid-sized companies may be
riskier, less liquid, more volatile and more vulnerable to economic, market and
industry changes than investments in larger, more-established companies. The
securities of smaller companies may trade less frequently and in smaller volumes
than securities of larger companies. In addition, smaller companies may be more
vulnerable to economic, market and industry changes. As a result, changes in the
price of securities issued by such companies may be more sudden or erratic than
the prices of large capitalization companies, especially over the short term.
Because smaller companies may have limited product lines, markets or financial
resources or may depend on a few key employees, they may be more susceptible to
particular economic events or competitive factors than large capitalization
companies. This may cause unexpected and frequent decreases in the value of a
Fund’s investments. These risks are higher for small cap
companies.
Large
Cap Company Risk. If a Fund
invests in large cap company securities, it may underperform other funds during
periods when a Fund’s large cap securities are out of favor.
Significant
Holdings Risk.
Although a Fund is considered “diversified” under applicable law, a relatively
large portion of its portfolio at times may be (and at the time of this filing,
is) invested in a relatively small number of securities. Significant investments
in a relatively small number of securities increases the risk that the value of
a Fund’s shares is more sensitive to economic results of the companies issuing
the securities. The value of the shares of a Fund may also be more volatile than
a fund that allocates its investments to a larger number of smaller
positions.
Industry
and Sector Focus Risk. At times, a Fund may
increase the relative emphasis of its investments in a particular industry or
sector. The prices of securities of issuers in a particular industry or sector
may be more susceptible to fluctuations due to changes in economic or business
conditions, government regulations, availability of basic resources or supplies,
contagion risk within a particular industry or sector or to other industries or
sectors, or other events that affect that industry or sector more than
securities of issuers in other industries and sectors. To the extent that a Fund
increases the relative emphasis of its investments in a particular industry or
sector, the value of a Fund’s shares may fluctuate in response to events
affecting that industry or sector.
80 | J.P.
Morgan U.S. Equity Funds
Technology
Sector Risk.
Market or economic factors impacting technology companies could have a major
effect on the value of a
Fund’s
investments. The value of stocks of technology companies is particularly
vulnerable to rapid changes in technology product cycles, rapid product
obsolescence and frequent new product introduction, unpredictable changes in
growth rates and competition for the services of qualified personnel, and
government regulation and competition, both domestically and internationally,
including competition from foreign competitors with lower production costs.
Stocks of technology companies, especially those of smaller, less-seasoned
companies, tend to be more volatile than the overall market. Technology
companies are heavily dependent on patent and intellectual property rights, the
loss or impairment of which may adversely affect profitability.
Healthcare
Sector Risk. Companies in
the healthcare sector are subject to extensive government regulation and their
profitability can be significantly affected by restrictions on government
reimbursement for medical expenses, rising costs of medical products and
services, pricing pressure (including price discounting), limited product lines
and an increased emphasis on the delivery of healthcare through outpatient
services. Companies in the healthcare sector are heavily dependent on obtaining
and defending patents, which may be time consuming and costly, and the
expiration of patents may also adversely affect the profitability of these
companies. Healthcare companies are also subject to extensive litigation based
on product liability and similar claims. In addition, their products can become
obsolete due to industry innovation, changes in technologies or other market
developments. Many new products in the healthcare sector require significant
research and development and may be subject to regulatory approvals, all of
which may be time consuming and costly with no guarantee that any product will
come to market. Several legislative proposals concerning healthcare have been
considered by the U.S. Congress in recent years and it is unclear what proposals
will ultimately be enacted, if any, and what effect they may have on companies
in the healthcare sector.
Industrials
Sector Risk. The value of
securities issued by companies in the industrials sector may be adversely
affected by supply and demand related to their specific products or services and
industrials sector products in general. The products of manufacturing companies
may face obsolescence due to rapid technological developments and frequent new
product introduction. Government regulations, world events, economic conditions
and exchange rates may adversely affect the performance of companies in the
industrials sector. Companies in the industrials sector may be adversely
affected by liability for environmental damage and product liability claims. The
industrials sector may also be adversely affected by changes or trends in
commodity prices, which may be influenced by unpredictable factors. Companies in
the industrials sector, particularly aerospace and defense companies, may also
be adversely affected by government spending policies because companies in this
sector tend to rely to a significant extent on government demand for their
products and services.
Financials
Sector Risk.
Financial services companies are subject to extensive governmental regulation
which may limit both the amounts and types of loans and other financial
commitments they can make, the interest rates and fees they can charge, the
scope of their activities, the prices they can charge and the amount of capital
they must maintain. Profitability is largely dependent on the availability and
cost of capital funds and can fluctuate significantly when interest rates change
or due to increased competition. In addition, deterioration of the credit
markets generally may cause an adverse impact in a broad range of markets,
including U.S. and international credit and interbank money markets generally,
thereby affecting a wide range of financial institutions and markets. Certain
events in the financials sector may cause an unusually high degree of volatility
in the financial markets, both domestic and foreign, and cause certain financial
services companies to incur large losses. Securities of financial services
companies may experience a dramatic decline in value when such companies
experience substantial declines in the valuations of their assets, take action
to raise capital (such as the issuance of debt or equity securities), or cease
operations. Credit losses resulting from financial difficulties of borrowers and
financial losses associated with investment activities can negatively impact the
sector. Insurance companies may be subject to severe price competition. Adverse
economic, business or political developments could adversely affect financial
institutions engaged in mortgage finance or other lending or investing
activities directly or indirectly connected to the value of real
estate.
Real
Estate Securities Risk. The value of real estate
securities in general, and REITs in particular, are subject to the same risks as
direct investments in real estate and mortgages, which include, but are not
limited to, sensitivity to changes in real estate values and property taxes,
interest rate risk, tax and regulatory risk, fluctuations in rent schedules and
operating expenses, adverse changes in local, regional or general economic
conditions, including reduced demand for commercial and office space as well as
increased maintenance or tenant improvement costs to convert properties for
other uses,
default risk of
tenants and borrowers, the financial condition of tenants,
buyers and
sellers, and the inability to re-lease space on attractive terms or to obtain
mortgage financing on a timely basis or at all, unfavorable changes in zoning,
building, environmental and other laws, the need for unanticipated renovations
and unexpected increases in the cost of energy and environmental factors.
Furthermore, a REIT could fail to qualify for tax-free pass-through of its
income under the Internal Revenue Code or fail to maintain its exemption from
registration under the 1940 Act, which could produce adverse economic
consequences for the REIT and its investors, including a Fund.
The
underlying mortgage loans may be subject to the risks of default or of
prepayments that occur earlier or later than expected, and such loans may also
include so-called “sub-prime” mortgages. The value of REITs will also rise and
fall in response to the management skill and creditworthiness of the issuer. In
particular, the value of these securities may decline when interest rates rise
November
1, 2024 | 81
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About the Funds
(continued)
and will also
be affected by the real estate market and by the management of the underlying
properties. REITs may be more volatile and/or more illiquid than other types of
equity securities. Each Fund will indirectly bear its proportionate share of
expenses, including management fees, paid by each REIT in which it invests in
addition to the expenses of a Fund.
In addition,
certain of the companies in which a Fund intends to invest may have developed or
commenced development on properties and may develop additional properties in the
future. Real estate development involves significant risks in addition to those
involved in the ownership and operation of established properties, including the
risks that financing, if needed, may not be available on favorable terms for
development projects, that construction may not be completed on schedule
(resulting in increased debt service expense and construction costs), that
estimates of the costs of construction may prove to be inaccurate and that
properties may not be leased, rented or operated on profitable terms and
therefore will fail to perform in accordance with expectations. As a result, the
value of a Fund’s investment may decrease in value. Real estate securities have
limited diversification and are, therefore, subject to risks inherent in
operating and financing a limited number of projects. Real estate securities are
also subject to heavy cash flow dependency and defaults by borrowers or
tenants.
Transactions
and Liquidity Risk. A Fund could
experience a loss when selling securities to meet redemption requests and its
liquidity may be negatively impacted. The risk of loss increases if the
redemption requests are large or frequent, occur in times of overall market
turmoil or declining prices for the securities sold, or when the securities a
Fund wishes to, or is required to, sell are illiquid. To the extent a large
proportion of shares of a Fund are held by a small number of shareholders (or a
single shareholder) including funds or accounts over which the adviser or its
affiliates have investment discretion, the Fund is subject to the risk that
these shareholders will purchase or redeem Fund shares in large amounts rapidly
or unexpectedly, including as a result of an asset allocation decision made by
the adviser or its affiliates. In addition to the other risks described in this
section, these transactions could adversely affect the ability of the Fund to
conduct its investment program. A Fund may be unable to sell illiquid securities
at its desired time or price or the price at which the securities have been
valued for purposes of the Fund’s net asset value. Illiquidity can be caused by
a drop in overall market trading volume, an inability to find a ready buyer, or
legal restrictions on the securities’ resale. Certain securities that were
liquid when purchased may later become illiquid, particularly in times of
overall economic distress. Similarly, large purchases of Fund shares may
adversely affect a Fund’s performance to the extent that the Fund is delayed in
investing new cash and is required to maintain a larger cash position than it
ordinarily would. Large redemptions also could accelerate the realization of
capital gains, increase a Fund’s transaction costs and impact the Fund’s
performance.
Derivatives
Risk. A Fund may
use derivatives in connection with their investment strategies. Derivatives may
be riskier than other types of investments because they may be more sensitive to
changes in economic or market conditions than other types of investments and
could result in losses that significantly exceed a Fund’s original investment. A
Fund may be more volatile than if a Fund had not been leveraged because the
leverage tends to exaggerate any effect on the value of a Fund’s portfolio
securities. Derivatives are subject to the risk that changes in the value of a
derivative may not correlate perfectly with the underlying asset, rate or index.
The use of derivatives may not be successful, resulting in losses to a Fund and
the cost of such strategies may reduce a Fund’s returns. Certain derivatives
also expose a Fund to counterparty risk (the risk that the derivative
counterparty will not fulfill its contractual obligations), including credit
risk of the derivative counterparty. In addition, a Fund may use derivatives for
non-hedging purposes, which increases that Fund’s potential for loss. Certain
derivatives are synthetic instruments that attempt to replicate the performance
of certain reference assets. With regard to such derivatives, a Fund does not
have a claim on the reference assets and is subject to enhanced counterparty
risk.
|
WHAT
IS A DERIVATIVE? |
|
Derivatives
are securities or contracts (like futures and options) that derive their
value from the performance of underlying assets or
securities. |
Investing in
derivatives and engaging in short sales will result in a form of leverage.
Leverage involves special risks. A Fund may be more volatile than if the Fund
had not been leveraged because the leverage tends to exaggerate any effect on
the value of the Fund’s portfolio securities. Registered investment companies
are limited in their ability to engage in derivative transactions.
The possible lack of a liquid
secondary market for derivatives and the resulting inability of a Fund to sell
or otherwise close a derivatives position could expose the Fund to losses and
could make derivatives more difficult for the Fund to value accurately.
Derivatives also can expose a Fund to derivative liquidity risk, which includes
risks involving the liquidity demands that derivatives can create to make
payments of margin, collateral, or settlement payments to counterparties, legal
risk, which includes the risk of loss resulting from insufficient or
unenforceable contractual documentation, insufficient capacity or authority of a
Fund’s counterparty and operational risk, which includes documentation or
settlement issues, system failures, inadequate controls and human
error.
82 | J.P.
Morgan U.S. Equity Funds
A Fund’s
transactions in futures contracts, swaps and other derivatives could also affect
the amount, timing and character of distributions to shareholders, which may
result in the Fund realizing more short-term capital gain and ordinary income
subject to tax at ordinary income tax rates than it would if it did not engage
in such transactions, which may adversely impact the Fund’s after-tax
return.
Strategy
Risk. Although the
Fund is normally managed as a core portfolio, it may invest more heavily in
either growth or value securities, depending on market conditions and the
convictions of the adviser.
If the Fund
invests more heavily in growth securities, it will be more subject to risks
related to growth investing. Growth investing attempts to identify companies
that the adviser believes will experience rapid earnings growth relative to
value or other types of securities. The value of these securities generally is
more sensitive to current or expected earnings than securities of other types of
companies. Short-term events, such as a failure to meet industry earnings
expectations, can cause dramatic decreases in the growth security price compared
to other types of securities. Growth securities may also trade at higher
multiples of current earnings compared to value or other securities, leading to
inflated prices and thus potentially greater declines in value. During times
when the Fund focuses more heavily on growth securities, the Fund’s performance
may be better or worse than the performance of equity funds that focus on value
securities or that have a broader investment style.
If the Fund
invests more heavily in value securities, it will be more subject to risks
related to value investing. Value investing attempts to identify companies that,
according to the adviser’s estimate of their true worth, are undervalued. The
adviser selects securities at prices that it believes are temporarily low
relative to factors such as the company’s earnings, cash flow or dividends. A
value security may decrease in price or may not increase in price as anticipated
by the adviser if other investors fail to recognize the company’s value or the
factors that the adviser believes will cause the security price to increase do
not occur. During times when the Fund focuses more heavily on value securities,
the Fund’s performance may be better or worse than the performance of equity
funds that focus on growth securities or that have a broader investment
style.
Foreign
Securities and Emerging Markets Risks. To the
extent a Fund invests in foreign securities (including depositary receipts),
these investments are subject to special risks in addition to those of U.S.
investments. These risks include political and economic risks, unstable
governments, civil conflicts and war, greater volatility, decreased market
liquidity, expropriation and nationalization risks, sanctions or other measures
by the United States or other governments, currency fluctuations, higher
transaction costs, delayed settlement, possible foreign controls on investment,
and less stringent investor protection and disclosure standards of foreign
markets. The securities markets of many foreign countries are relatively small,
with a limited number of companies representing a small number of industries. If
foreign securities are denominated and traded in a foreign currency, the value
of a Fund’s foreign holdings can be affected by currency exchange rates and
exchange control regulations. In certain markets where securities and other
instruments are not traded “delivery versus payment,” a Fund may not receive
timely payment for securities or other instruments it has delivered or receive
delivery of securities paid for and may be subject to increased risk that the
counterparty will fail to make payments or delivery when due or default
completely.
Foreign
market trading hours, clearance and settlement procedures, and holiday schedules
may limit a Fund's ability to buy and sell securities. Investments in foreign
markets may also be adversely affected by governmental actions such as the
imposition of capital controls, nationalization of companies or industries,
expropriation of assets or the imposition of punitive taxes. The governments of
certain countries may prohibit or impose substantial restrictions on foreign
investing in their capital markets or in certain sectors or industries. In
addition, a foreign government may limit or cause delay in the convertibility or
repatriation of its currency which would adversely affect the U.S. dollar value
and/or liquidity of investments denominated in that currency. Certain foreign
investments may become less liquid in response to market developments or adverse
investor perceptions, or become illiquid after purchase by a Fund, particularly
during periods of market turmoil. Moreover, the growing interconnectivity of
global economies and financial markets has increased the probability that
adverse developments and conditions in one country or region will affect the
stability of economies and financial markets in other countries or regions. A
reduction in trading in securities of issuers located in countries whose
economies are heavily dependent upon trading with key partners may have an
adverse impact on a Fund’s investments.
Securities
registration, custody, and settlement may in some instances be subject to delays
and legal and administrative uncertainties. Foreign investment in the securities
markets of certain foreign countries is restricted or controlled to varying
degrees. These restrictions or controls may at times limit or preclude
investment in certain securities and may increase the costs and expenses of a
Fund. In addition, the repatriation of investment income, capital or the
proceeds of sales of securities from certain of the countries is controlled
under regulations, including in some cases the need for certain advance
government notification or authority, and if a deterioration occurs in a
country’s balance of payments, the country could impose temporary restrictions
on foreign capital remittances. A Fund also could be adversely affected by
delays in, or a refusal to grant, any required governmental approval for
repatriation, as well as by the application to it of other restrictions on
investment.
November
1, 2024 | 83
More
About the Funds
(continued)
Certain Funds may invest in
securities in “emerging markets,” but these are not principal investments for
any Funds. Events and evolving conditions in certain economies or markets may
alter the risks associated with investments tied to countries or regions that
historically were perceived as comparatively stable becoming riskier and more
volatile. The risks associated with foreign securities are magnified in
countries in “emerging markets.” These countries may have relatively unstable
governments and less-established market economies than developed countries.
Emerging markets may face greater social, economic, regulatory and political
uncertainties. These risks make emerging market securities more volatile and
less liquid than securities issued in more developed countries and you may
sustain sudden, and sometimes substantial, fluctuations in the value of your
investments. Certain emerging market countries may be subject to less stringent
requirements regarding accounting, auditing, financial reporting and record
keeping and therefore, material information related to an investment may not be
available or reliable. In addition, a Fund is limited in its ability to exercise
its legal rights or enforce a counterparty’s legal obligations in certain
jurisdictions outside of the United States, in particular, in emerging markets
countries. In addition, due to jurisdictional limitations,
U.S. regulators
may be limited in their ability to enforce regulatory or legal obligations in
emerging market countries.
Securities
Lending Risk. A
Fund may engage in securities lending. Securities lending involves counterparty
risk, including the risk that the loaned securities may not be returned or
returned in a timely manner, and/or a loss of rights in the collateral if the
borrower or the lending agent defaults. This risk is increased when a Fund’s
loans are concentrated with a single or limited number of borrowers. In
addition, a Fund bears the risk of loss in connection with its investment of the
cash collateral it receives from a borrower. To the extent that the value or
return of a Fund’s investment of the cash collateral declines below the amount
owed to the borrower, a Fund may incur losses that exceed the amount it earned
on lending the security. In situations where the adviser does not believe that
it is prudent to sell the cash collateral investments in the market, a Fund may
borrow money to repay the applicable borrower the amount of cash collateral owed
to the borrower upon return of the loaned securities. This will result in
financial leverage, which may cause a Fund to be more volatile because financial
leverage tends to exaggerate the effect of any increase or decrease in the value
of a Fund’s portfolio securities.
Exchange-Traded
Fund (ETF) and Other Investment Company Risk. A Fund may
invest in shares of other investment companies and ETFs. Shareholders bear both
their proportionate share of a Fund’s expenses and similar expenses of the
underlying investment company or ETF when a Fund invests in shares of another
investment company or ETF. A Fund is subject to the risks associated with the
ETF or investment company’s investments. The price and movement of an ETF
designed to track an index may not track the index and may result in a loss. In
addition, ETFs may trade at a price above (premium) or below (discount) their
NAV, especially during periods of significant market volatility or stress,
causing investors to pay significantly more or less than the value of the ETF’s
underlying portfolio. Certain ETFs traded on exchanges may be thinly traded and
experience large spreads between the “ask” price quoted by a seller and the
“bid” price offered by a buyer.
Convertible
Securities Risk.
A convertible security generally entitles the holder to receive interest paid or
accrued on debt securities or the dividend paid on preferred securities until
the convertible security matures or is redeemed, converted or exchanged. Before
conversion, convertible securities generally have characteristics similar to
both debt and equity securities. The value of convertible securities tends to
decline as interest rates rise and, because of the conversion feature, tends to
vary with fluctuations in the market value of the underlying securities.
Convertible securities ordinarily provide a stream of income with generally
higher yields than those of common stock of the same or similar issuers.
Convertible securities generally rank senior to common stock in a corporation’s
capital structure but are usually subordinated to comparable non-convertible
securities. Convertible securities generally do not participate directly in any
dividend increases or decreases of the underlying securities, although the
market prices of convertible securities may be affected by any dividend changes
or other changes in the underlying securities.
Initial
Public Offering (IPO) Risk. IPO
securities have no trading history, and information about the companies may be
available for very limited periods. The prices of securities sold in IPOs may be
highly volatile and their purchase may involve high transaction costs. At any
particular time or from time to time, a Fund may not be able to invest in
securities issued in IPOs, or invest to the extent desired, because, for
example, only a small portion (if any) of the securities being offered in an IPO
may be made available to a Fund. In addition, under certain market conditions, a
relatively small number of companies may issue securities in IPOs. Similarly, as
the number of purchasers to which IPO securities are allocated increases, the
number of securities issued to a Fund may decrease. The performance of a Fund
during periods when it is unable to invest significantly or at all in IPOs may
be lower than during periods when a Fund is able to do so. In addition, as a
Fund increases in size, the impact of IPOs on the Fund’s performance will
generally decrease.
Master
Limited Partnerships (MLPs) Risk. A Fund may
invest in MLPs whose ownership interests are publicly traded and that primarily
derive their income from, among other industries, the mining, production,
transportation or processing of minerals or natural resources, although they may
also finance entertainment, research and development, real estate and other
projects. Investments held by an MLP may be relatively illiquid, limiting the
MLP’s ability to vary its portfolio promptly in response to changes in economic
or other conditions. In addition, MLPs may have limited financial resources,
their securities may trade infrequently and in limited volume and they may be
subject to more abrupt or erratic price movements than securities of larger or
more broadly-based companies. The risks of investing in an MLP are generally
those inherent in investing in a partnership as opposed to a corporation.
84 | J.P.
Morgan U.S. Equity Funds
For example,
state law governing partnerships is often less restrictive than state law
governing corporations. Accordingly, there may be fewer protections afforded
investors in an MLP than investors in a corporation. Additional risks involved
with investing in an MLP are risks associated with the specific industry or
industries in which the partnership invests, such as the risks of investing in
real estate, or oil and gas industries.
Prepayment
Risk. The issuer
of certain securities may repay principal in advance, especially when yields
fall. Changes in the rate at which prepayments or redemptions occur can affect
the return on investment of these securities. When debt obligations are prepaid
or when securities are called, a Fund may have to reinvest in securities with a
lower yield. A Fund also may fail to recover additional amounts (i.e., premiums)
paid for securities with higher coupons, resulting in an unexpected capital
loss.
Preferred
Securities Risk. Preferred
securities generally have a preference as to dividends and liquidation over an
issuer’s common stock but ranks junior to debt securities in an issuer’s capital
structure. Unlike interest payments on debt securities, dividends on preferred
securities are payable only if declared by the issuer’s board of directors. As a
consequence, if the board of directors of an issuer does not declare dividends
or distributions for the relevant dividend or distribution periods, the issuer
will not be obligated to pay dividends or distributions on the relevant payment
date, and such dividends and distributions may be forfeited. Holders of
preferred securities typically do not have voting rights except in certain
circumstances where they may be given only limited voting rights. Preferred
securities also may be subject to optional or mandatory redemption provisions.
Preferred shares may carry different rights or obligations in jurisdictions
outside of the United States.
Short
Selling Risk.
The Fund’s strategy may involve more risk than other funds that do not engage in
short selling or other short equity positions. The Fund’s use of short sales or
other short equity positions in combination with long positions in the Fund’s
portfolio in an attempt to improve performance or to reduce overall portfolio
risk may not be successful and may result in greater losses or lower positive
returns than if the Fund held only long positions. It is possible that the
Fund’s long equity positions will decline in value at the same time that the
value of its short equity positions increases, thereby increasing potential
losses to the Fund.
In order to establish a short
position in a security, the Fund must first borrow the security from a lender,
such as a broker or other institution. The Fund may not always be able to obtain
the security at a particular time or at an acceptable price. Thus, there is risk
that the Fund may be unable to implement its investment strategy due to the lack
of available securities or for other reasons.
After short selling a
security, the Fund may subsequently seek to close this position by purchasing
and returning the security to the lender on a later date. The Fund may not
always be able to complete or “close out” the short position by replacing the
borrowed securities at a particular time or at an acceptable price.
In addition, the Fund may be
prematurely forced to close out a short position if the lender demands the
return of the borrowed security. The Fund incurs a loss as a result of a short
sale or other short equity position if the market value of the borrowed security
increases between the date of the short sale and the date when the Fund replaces
the security. The Fund’s loss on a short sale or other short equity position is
potentially unlimited because there is no upward limit on the price a borrowed
security could attain.
Further, if other short
sellers of the same security want to close out their positions at the same time,
a “short squeeze” can occur. A short squeeze occurs when demand exceeds the
supply for the security sold short. A short squeeze makes it more likely that
the Fund will need to replace the borrowed security at an unfavorable price,
thereby increasing the likelihood that the Fund will lose some or all of the
potential profit from, or incur a loss on, the short sale. Furthermore, taking
short positions in securities results in a form of leverage. Leverage involves
special risks described under “Derivatives
Risk.”
The Securities and Exchange
Commission and financial industry regulatory authorities in other countries
have, in the past, imposed temporary prohibitions and restrictions on certain
types of short sale transactions. These prohibitions and restrictions, or the
imposition of other regulatory requirements on short selling in the future,
could inhibit the ability of the adviser to sell securities short on behalf of
the Fund.
Cyber
Security Risk. As the use
of technology has become more prevalent in the course of business, the Funds
have become more susceptible to operational and financial risks associated with
cyber security, including: theft, loss, misuse, improper release, corruption and
destruction of, or unauthorized access to, confidential or highly restricted
data relating to a Fund and its shareholders; and compromises or failures to
systems, networks, devices and applications relating to the operations of a Fund
and its service providers. Cyber security risks may result in financial losses
to a Fund and its shareholders; the inability of a Fund to transact business
with its shareholders; delays or mistakes in the calculation of a Fund’s NAV or
other materials provided to shareholders; the inability to process transactions
with shareholders or other parties; violations of privacy and other laws;
regulatory fines, penalties and reputational damage; and compliance and
remediation costs, legal fees and other expenses. A Fund’s service providers
(including, but not limited to, the adviser, any sub-advisers, administrator,
transfer agent, and custodian or their agents), financial intermediaries,
companies in which a Fund invests and parties with which a Fund engages in
portfolio or other transactions also may be adversely impacted by cyber security
risks in their own businesses, which could result in losses to a Fund or its
shareholders. While
November
1, 2024 | 85
More
About the Funds
(continued)
measures have
been developed which are designed to reduce the risks associated with cyber
security, there is no guarantee that those measures will be effective,
particularly since the Funds do not directly control the cyber security defenses
or plans of their service providers, financial intermediaries and companies in
which they invest or with which they do business.
Regulatory
and Legal Risk. U.S. and
non-U.S. governmental agencies and other regulators regularly implement
additional regulations and legislators pass new laws that affect the investments
held by a Fund, the strategies used by a Fund or the level of regulation or
taxation applying to a Fund (such as regulations related to investments in
derivatives and other transactions). These regulations and laws may adversely
impact the investment strategies, performance, costs and operations of a Fund or
taxation of shareholders.
Volcker
Rule Risk. Pursuant to
section 619 of the Dodd-Frank Wall Street Reform and Consumer Protection Act and
certain rules promulgated thereunder known as the Volcker Rule, if the adviser
and/or its affiliates own 5% or more of the outstanding ownership interests of a
Fund after the permitted seeding period from the implementation of a Fund’s
investment strategy, a Fund could be subject to restrictions on trading that
would adversely impact the Fund’s ability to execute its investment strategy.
Generally, the permitted seeding period is three years from the implementation
of a Fund’s investment strategy, with permissible extensions under certain
circumstances. As a result, the adviser and/or its affiliates may be required to
reduce their ownership interests in a Fund at a time that is sooner than would
otherwise be desirable, which may result in the Fund’s liquidation or, if the
Fund is able to continue operating, may result in losses, increased transaction
costs and adverse tax consequences as a result of the sale of portfolio
securities.
Covered
Call Option Risk. When the
Fund sells covered call options, it receives cash but limits its opportunity to
profit from an increase in the market value of the security beyond the exercise
price (plus the premium received). The gain on an underlying stock will be equal
to the difference between the exercise price and the original purchase price of
the underlying security, plus the premium received. In a rising market, the
option may require the Fund to sell a security at an exercise price that is
lower than the Fund would receive if the security was sold at the market price.
If a call expires unexercised, the Fund realizes a gain in the amount of the
premium received, although there may have been a decline (unrealized loss) in
the market value of the underlying security during the option period which may
exceed such gain. If the underlying security should decline by more than the
option premium the Fund received, there will be a loss on the overall
position.
For more information about
risks associated with the types of investments that a Fund purchases, please
read the “Risk/Return Summaries” at the front of this prospectus and the
Statement of Additional Information.
Conflicts
of Interest
An investment
in a Fund is subject to a number of actual or potential conflicts of interest.
For example, the Adviser and/or its affiliates provide a variety of different
services to a Fund, for which the Fund compensates them. As a result, the
Adviser and/or its affiliates have an incentive to enter into arrangements with
a Fund, and face conflicts of interest when balancing that incentive against the
best interests of a Fund. The Adviser and/or its affiliates also face conflicts
of interest in their service as investment adviser to other clients, and, from
time to time, make investment decisions that differ from and/or negatively
impact those made by the Adviser on behalf of a Fund. In addition, affiliates of
the Adviser provide a broad range of services and products to their clients and
are major participants in the global currency, equity, commodity, fixed-income
and other markets in which a Fund invests or will invest. In certain
circumstances, by providing services and products to their clients, these
affiliates’ activities will disadvantage or restrict the Funds and/or benefit
these affiliates. The Adviser may also acquire material non-public information
which would negatively affect the Adviser’s ability to transact in securities
for a Fund. JPMorgan and the Funds have adopted policies and procedures
reasonably designed to appropriately prevent, limit or mitigate conflicts of
interest. In addition, many of the activities that create these conflicts of
interest are limited and/or prohibited by law, unless an exception is available.
For more information about conflicts of interest, see the Potential Conflicts of
Interest section in the Statement of Additional Information.
Temporary
Defensive and Cash Positions
For liquidity
and to respond to unusual market conditions, the Funds may invest all or most of
their total assets in cash and cash
equivalents for
temporary defensive purposes. In addition, certain Funds may invest in cash and
cash equivalents as a principal investment strategy. These investments may
result in a lower yield than lower-quality or longer-term
investments.
|
WHAT
IS A CASH EQUIVALENT? |
|
Cash
equivalents are highly liquid, high-quality instruments with maturities of
three months or less on the date they are purchased.
They
include securities issued by the U.S. government, its agencies and
instrumentalities, repurchase agreements, certificates of
deposit,
bankers’ acceptances, commercial paper, money market mutual funds and bank
deposit accounts. |
86 | J.P.
Morgan U.S. Equity Funds
While the
Funds are engaged in a temporary defensive position, they may not meet their
investment objectives. These investments may also be inconsistent with a Fund’s
main investment strategies. Therefore, the Funds will pursue a temporary
defensive position only when market conditions warrant.
Frank
Russell Company Disclaimer
Frank
Russell Company is the source and owner of the Russell Index data contained or
reflected in this material and all trademarks and copyrights related thereto.
Frank Russell Company is not responsible for the formatting or configuration of
this material or for any inaccuracy in the adviser's presentation
thereof.
Expense
Limitations
Small
Cap Growth Fund
The Fund may invest in one or
more money market funds advised by the adviser or its affiliates (affiliated
money market funds). The Fund’s adviser, shareholder servicing agent and/or
administrator have contractually agreed to waive fees and/or reimburse expenses
in an amount sufficient to offset the respective net fees each collects from the
affiliated money market funds on the Fund’s investment in such money market
funds for Class L Shares. These waivers are in effect through 10/31/25, at which
time it will be determined whether such waivers will be renewed or revised. To
the extent that the Fund engages in securities lending, affiliated money market
fund fees and expenses resulting from the Fund’s investment of cash received
from securities lending borrowers are not included in Total Annual Fund
Operating Expenses and therefore, the above waivers do not apply to such
investments.
U.S.
Small Company Fund
The Fund may invest in one or
more money market funds advised by the adviser or its affiliates (affiliated
money market funds). The Fund’s adviser, shareholder servicing agent and/or
administrator have contractually agreed to waive fees and/or reimburse expenses
in an amount sufficient to offset the respective net fees each collects from the
affiliated money market funds on the Fund’s investment in such money market
funds for Class L Shares. These waivers are in effect through 10/31/25, at which
time it will be determined whether such waivers will be renewed or revised. To
the extent that the Fund engages in securities lending, affiliated money market
fund fees and expenses resulting from the Fund’s investment of cash received
from securities lending borrowers are not included in Total Annual Fund
Operating Expenses and therefore, the above waivers do not apply to such
investments.
Value
Advantage Fund
The Fund’s adviser and/or its
affiliates have contractually agreed to waive fees and/or reimburse expenses to
the extent Total Annual Fund Operating Expenses (excluding acquired fund fees
and expenses other than certain money market fund fees as described below,
dividend and interest expenses related to short sales, interest, taxes, expenses
related to litigation and potential litigation, expenses related to trustee
elections, and extraordinary expenses) exceed 0.75% of the average daily net
assets of Class L Shares. The Fund may invest in one or more money market funds
advised by the adviser or its affiliates (affiliated money market funds). The
Fund’s adviser, shareholder servicing agent and/or administrator have
contractually agreed to waive fees and/or reimburse expenses in an amount
sufficient to offset the respective net fees each collects from the affiliated
money market funds on the Fund’s investment in such money market funds. These
waivers are in effect through 10/31/25, at which time it will be determined
whether such waivers will be renewed or revised. To the extent that the Fund
engages in securities lending, affiliated money market fund fees and expenses
resulting from the Fund’s investment of cash received from securities lending
borrowers are not included in Total Annual Fund Operating Expenses and
therefore, the above waivers do not apply to such
investments.
Additional
Fee Waiver and/or Expense Reimbursement
Service
providers to a Fund may, from time to time, voluntarily waive all or a portion
of any fees to which they are entitled and/or reimburse certain expenses as they
may determine from time to time. A Fund’s service providers may discontinue or
modify these voluntary actions at any time without notice. Performance for the
Funds will reflect the voluntary waiver of fees and/or the reimbursement of
expenses, if any. Without these voluntary waivers and/or expense reimbursements,
performance would have been less favorable.
November
1, 2024 | 87
The
Funds’ Management and Administration
The following
Funds are series of JPMorgan Trust I (JPMT I), a Delaware statutory
trust:
Mid Cap Equity Fund
Small Cap Blend Fund
U.S. Small Company Fund
Value Advantage Fund
Small Cap Blend Fund
U.S. Small Company Fund
Value Advantage Fund
The following
Funds are series of JPMorgan Trust II (JPMT II), a Delaware statutory
trust:
Mid Cap
Growth Fund
Small Cap Growth Fund
Small Cap Value Fund
SMID Cap Equity Fund
Small Cap Growth Fund
Small Cap Value Fund
SMID Cap Equity Fund
Growth
Advantage Fund is a series of J.P. Morgan Mutual Fund Investment Trust
(JPMMFIT), a Massachusetts business trust.
Mid Cap Value
Fund is a series of J.P. Morgan Fleming Mutual Fund Group, Inc. (JPMFMFG), a
Maryland corporation.
The Board of
Trustees of each trust and the Board of Directors of JPMFMFG are responsible for
overseeing all business activities of their respective Funds.
Each of the
Funds operates in a multiple class structure. A multiple class fund is an
open-end investment company that issues two or more classes of shares
representing interests in the same investment portfolio.
Each class in
a multiple class fund can set its own transaction minimums and may vary with
respect to expenses for distribution, administration and shareholder services.
This means that one class could offer access to a Fund on different terms than
another class. Certain classes may be more appropriate for a particular
investor.
Each Fund may
issue other classes of shares that have different expense levels and performance
and different requirements for who may invest. Call 1-800-480-4111 to obtain
more information concerning all of the Funds’ other share classes. A Financial
Intermediary who receives compensation for selling Fund shares may receive a
different amount of compensation for sales of different classes of
shares.
The Funds’
Investment Adviser
J.P. Morgan
Investment Management Inc. (JPMIM) is the investment adviser to the Funds and
makes the day-to-day investment decisions for the Funds. In rendering investment
advisory services to the Fund, JPMIM uses the portfolio management, research and
other resources of a foreign (non-U.S.) affiliate of JPMIM and may provide
services to the Fund through a “participating affiliate” arrangement, as that
term is used in relief granted by the staff of the SEC. Under this relief, U.S.
registered investment advisers are allowed to use portfolio management or
research resources of advisory affiliates subject to the regulatory supervision
of the registered investment adviser.
JPMIM is a
wholly-owned subsidiary of JPMorgan Asset Management Holdings Inc., which is a
wholly-owned subsidiary of JPMorgan Chase & Co. (JPMorgan Chase), a bank
holding company. JPMIM is located at 383 Madison Avenue, New York, NY
10179.
During the fiscal year ended
June 30, 2024, JPMIM was paid management fees (net of waivers), as shown below,
as a percentage of average daily net assets:
|
JPMorgan
Growth Advantage Fund |
0.50% |
|
JPMorgan
Mid Cap Equity Fund |
0.58 |
|
JPMorgan
Mid Cap Growth Fund |
0.62 |
|
JPMorgan
Mid Cap Value Fund |
0.60 |
|
JPMorgan
Small Cap Blend Fund |
0.63 |
|
JPMorgan
Small Cap Equity Fund |
0.65 |
|
JPMorgan
Small Cap Growth Fund |
0.65 |
|
JPMorgan
Small Cap Value Fund |
0.64 |
|
JPMorgan
SMID Cap Equity Fund |
0.48 |
|
JPMorgan
U.S. Small Company Fund |
0.60 |
|
JPMorgan
Value Advantage Fund |
0.49 |
88 |
A discussion of the basis the
Board of Trustees of each Trust used in reapproving the investment advisory
agreements for the Funds is in the financial statements and other information
filed with the SEC on Form N-CSR
(“Financial
statements and Other Information”)
for the most
recent fiscal period ended December 31, which is available online at
www.jpmorganfunds.com.
The
Portfolio Managers
Growth
Advantage Fund
The portfolio management team
is led by Felise L. Agranoff, Managing Director of JPMIM and a CFA
charterholder, and Larry H. Lee, Managing Director of JPMIM. Ms. Agranoff is a
portfolio manager and shares authority in the day-to-day management of the Fund.
An employee since 2004, Ms. Agranoff has been a portfolio manager since 2015 and
has been a research analyst in the firm’s U.S. Equity Group since 2004. Mr. Lee
is a portfolio manager and research analyst within the U.S. Equity Group. An
employee since 2006, Mr. Lee covers the financials and business services sector
for the Large Cap Growth Strategy and is a co-portfolio manager for the J.P.
Morgan Growth Advantage and Large Cap Growth Strategies.
Mid
Cap Equity Fund
The portfolio management team
is led by Jonathan K.L. Simon, Managing Director of JPMIM, Lawrence E. Playford,
Managing Director of JPMIM and a CFA charterholder, Felise L. Agranoff, Managing
Director of JPMIM and a CFA charterholder, Daniel Bloomgarden, Managing Director
of JPMIM and a CFA charterholder,
Ryan N.
Jones,
Executive
Director of JPMIM, and Jeremy C. Miller, Executive Director of JPMIM. Messrs.
Simon, Playford,
Jones and Miller
are primarily responsible for the Fund’s value investments, while Ms. Agranoff
and Mr. Bloomgarden are primarily responsible for the Fund’s growth
investments.
Mr. Simon is the lead
portfolio manager on the Fund’s value investments and is a senior member of the
U.S. Equity Value portfolio management team. Messrs. Playford,
Jones and Miller
are co-portfolio managers on the Fund’s value investments and share authority in
the day-to-day management of the Fund. Mr. Simon has worked as a portfolio
manager for JPMIM and its affiliates (or their predecessors) since 1987 and has
been employed by the firm since 1980. An employee of JPMIM or its affiliates
since 1993, Mr. Playford
is a senior
member of the U.S. Equity Value team. He joined the U.S. Equity Value team as a
research analyst in 2003 and became a portfolio manager in 2004. An employee of
the firm since 2016, Mr. Jones has been an investment analyst on the U.S. Equity
Value team since 2016, currently covering technology & communication
services, and a portfolio manager since 2023. Before joining the firm, Mr. Jones
was in technology equity research at several other firms. An employee of the
firm since 2016, Mr. Miller has been an investment analyst on the U.S. Equity
Value team since 2016, currently covering industrials and materials, and a
portfolio manager since 2023. Before joining the firm, Mr. Miller was an
industrial and materials specialist at Vertical Research Partners and an
institutional equity salesperson at several other firms.
Mr. Simon will retire from
JPMIM effective early 2025. Until his retirement, Mr. Simon will continue to
serve on the portfolio management team of the Fund, and upon his retirement, Mr.
Playford will become the lead portfolio manager and Messrs. Jones and Miller
will continue to be responsible for the management of the Fund’s value
investments as co-portfolio managers.
Ms. Agranoff is a portfolio
manager and shares authority in the day-to-day management of the Fund’s growth
investments.
An employee
since 2004,
Ms. Agranoff has
been a portfolio manager since 2015 and has been a research analyst in the
firm’s U.S.
Equity Group
since 2004. Mr. Bloomgarden is a portfolio manager and research analyst within
the U.S. Equity Group. An employee since 2015, Mr. Bloomgarden leads consumer
sector coverage for the J.P. Morgan Mid Cap Growth and Small Cap Growth
Strategies and is a co-portfolio manager for the Mid Cap Growth and Mid Cap
Equity Strategies.
Mid
Cap Growth Fund
The portfolio management team
is led by Felise L. Agranoff, Managing Director of JPMIM and a CFA
charterholder, and Daniel Bloomgarden, Managing Director of JPMIM and a CFA
charterholder. Ms. Agranoff is a portfolio manager and shares authority in the
day-to-day management of the Fund. Information about Mr. Bloomgarden, and Ms.
Agranoff is discussed earlier in this section.
Mid
Cap Value Fund
The portfolio management team
is led by Jonathan K.L. Simon, Managing Director of JPMIM, Lawrence E. Playford,
Managing Director of JPMIM and a CFA charterholder, Ryan N. Jones, Executive
Director of JPMIM, and Jeremy C. Miller, Executive Director of JPMIM. Mr. Simon
is the lead portfolio manager of the Fund and is a senior member of the U.S.
Equity Value portfolio management team. Messrs. Playford,
Jones and Miller
are co-portfolio managers and share authority in the day-to-day management of
the Fund. Information about Messrs. Simon,
Playford, Jones
and Miller is discussed earlier in this section.
| 89
The
Funds’ Management and Administration
(continued)
Mr. Simon will retire from
JPMIM effective early 2025. Until his retirement, Mr. Simon will continue to
serve on the portfolio management team of the Fund, and upon his retirement, Mr.
Playford will become the lead portfolio manager and Messrs. Jones and Miller
will also continue to be responsible for the management of the Fund as
co-portfolio managers.
Small
Cap Blend Fund
The portfolio management team
is led by Lawrence E. Playford, Managing Director of JPMIM and a CFA
charterholder, and Eytan Shapiro, Managing Director of JPMIM and a CFA
charterholder. Mr. Playford leads the team primarily responsible for the Fund’s
value investments while Mr. Shapiro leads the team primarily responsible for the
Fund’s growth investments. An employee of JPMIM or its affiliates since 1993,
Mr. Playford is a senior member of the U.S. Equity Value Team. He joined the
team as a research analyst in 2003 and became a portfolio manager in 2004. Mr.
Shapiro is Chief Investment Officer of the U.S. Equity Growth and Small Cap
portfolio management teams. Mr. Shapiro has worked as a portfolio manager for
JPMIM or its affiliates (or their predecessors) since 1989 and has been employed
by the firm since 1985.
Small
Cap Equity Fund
SMID Cap Equity Fund
SMID Cap Equity Fund
The portfolio management team
is led by Don San Jose, Managing Director of JPMIM, and Daniel J. Percella,
Managing Director of JPMIM and a CFA charterholder. Mr. San Jose is the lead
portfolio manager on the Fund and is a senior member of the U.S. Equity Small
Cap portfolio management team. Mr. Percella is the co-portfolio manager and
shares authority in the day-to-day management of the Fund. Mr. San Jose joined
the U.S. Small Cap Equity Group as an analyst in 2004 and became a portfolio
manager in 2007. Mr. San Jose has been employed by the firm since 2000. Mr.
Percella has been a portfolio manager since 2014, and prior to that time he was
a research analyst on the Small Cap Active Core team. Mr. Percella has been an
employee of JPMIM since 2008.
Small
Cap Growth Fund
The portfolio management team
is led by Eytan Shapiro, Managing Director of JPMIM and a CFA charterholder,
Matthew Cohen, M.D., Managing Director of JPMIM, Phillip D. Hart, Managing
Director of JPMIM and a CFA charterholder, and Michael Stein, Executive Director
of JPMIM and a CFA charterholder. Mr. Shapiro is the lead portfolio manager on
the Fund and is Chief Investment Officer of the U.S. Equity Growth and Small Cap
portfolio management teams. An employee since 2005, Dr. Cohen is a portfolio
manager and a US equity research analyst. Dr. Cohen is responsible for research
analysis and stock selection of healthcare stocks for the JPMorgan Small Cap
Growth and Mid Cap Growth funds. Additionally, he serves as lead portfolio
manager on the JPMorgan Global Healthcare strategy and a co-portfolio manager on
the JPMorgan Small Cap Growth Fund. Mr. Hart is Head of the U.S. Structured
Equity Small and Mid Cap team, and a portfolio manager. An employee since 2003,
he has been managing small and mid cap assets for the past 20 years and his
responsibilities include managing all of the team’s strategies. Previously, he
has held roles as both a fundamental and quantitative research analyst in
addition to helping with daily implementation and maintenance of portfolios. Mr.
Stein is a research analyst within the U.S. Equity Group. An employee since
2014, Mr. Stein is responsible for the industrials and energy sectors for the
J.P. Morgan Mid Cap Growth and Small Cap Growth Strategies. Prior to joining the
firm, Mr. Stein previously worked at Barclays and Morgan Stanley, with seven
years of experience covering electrical equipment and industrial conglomerates.
Information about Mr. Shapiro is discussed earlier in this section.
Dr. Cohen has announced his
retirement from JPMIM in the spring of 2025. Dr. Cohen will continue to serve on
the portfolio management team of the Fund until his retirement, and upon his
retirement the current portfolio managers, Eytan Shapiro, Phillip D. Hart and
Michael Stein will assume full authority of the day-to-day management of the
Fund. Mr. Shapiro will continue as the lead portfolio manager on the
Fund.
Small Cap
Value Fund
U.S. Small Company Fund
U.S. Small Company Fund
The portfolio management team
for the Fund utilizes a team-based approach and uses the models, insights and
recommendations of the broader U.S. Disciplined Core Equity team. The portfolio
management team is comprised of Phillip D. Hart, Wonseok Choi, Akash Gupta and
Robert Ippolito. Mr. Hart, a Managing Director of JPMIM and a CFA charterholder,
is the lead portfolio manager for the Fund and is primarily responsible for
portfolio construction. Mr. Hart has worked as a portfolio manager for the U.S.
Disciplined Core Equity team at JPMIM since 2009 and has been employed by the
firm since 2003. Prior to becoming a portfolio manager, he was a qualitative
research analyst within this group. Mr. Choi, Managing Director and director of
U.S. equity quantitative research, is responsible for Strategic Quantitative
Research. This entails all aspects of process enhancements including, but not
limited to: factors to be included into the investment process as well as
refinements to existing factors, portfolio construction as well as our big data
efforts. Mr. Gupta, Executive Director, is a research analyst and portfolio
manager on the U.S. Disciplined Core Equity team. An employee since 2004, Mr.
Gupta previously spent over three years in the sell-side Equity Research Group,
focusing on the electronics
90 |
manufacturing
supply chain sector. He is also a CFA charterholder and a certified Financial
Risk Manager (FRM). Mr. Ippolito, Executive Director and CFA charterholder, has
served as a portfolio manager of the Fund since May 2021. An employee since
2009, Mr. Ippolito has worked as a portfolio manager in the U.S. Structured
Equity Small and Mid-Cap Group since 2021. Prior to becoming a portfolio
manager, Mr. Ippolito was a fundamental research analyst within the
group.
Value
Advantage Fund
The portfolio management team
is led by Jonathan K.L. Simon, Managing Director of JPMIM, Scott
Blasdell,
Managing
Director of JPMIM and a CFA charterholder, and Graham Spence, Executive Director
of JPMIM. Mr. Simon is the lead portfolio manager on the Fund and is a senior
member of the U.S. Equity Value portfolio management team. Mr. Blasdell has been
a portfolio manager on the U.S. Equity Value team since 2013 and an employee of
JPMIM since 1999. Mr. Spence joined the U.S. Equity Value team in 2013 as a
portfolio analyst dedicated to Value Advantage. Information about Mr. Simon is
discussed earlier in this section.
Mr. Simon will retire from
JPMIM effective early 2025. Until his retirement, Mr. Simon will continue to
serve on the portfolio management team and upon his retirement, Mr. Blasdell
will become the lead portfolio manager and Mr. Spence will continue to be a
co-portfolio manager of the Fund.
The Statement
of Additional Information provides additional information about the portfolio
managers’ compensation, other accounts managed by the portfolio managers and the
portfolio managers’ ownership of securities in the Funds.
The
Funds’ Administrator
JPMIM (the Administrator)
provides administration services and oversees each Fund’s other service
providers. The Administrator receives the following annual fee on behalf of each
Fund for administration services: 0.075% of the first $10 billion of average
daily net assets of the Fund, plus 0.050% of average daily net assets of the
Fund between $10 billion and $20 billion, plus 0.025% of average daily net
assets of the Fund between $20 billion and $25 billion, plus 0.010% of the
average daily net assets of the Fund over $25 billion.
The
Funds’ Shareholder Servicing Agent
The Trusts
and JPMFMG, on behalf of the Funds, have entered into shareholder servicing
agreements with JPMorgan Distribution Services, Inc. (JPMDS) under which JPMDS
has agreed to provide certain support services to the Funds’ shareholders. For
performing these services, JPMDS, as shareholder servicing agent, receives an
annual fee of up to 0.25% of the average daily net assets of the Class A, Class
C and Class I Shares of each Fund, as applicable, and an annual fee of up to
0.10% of the average daily net assets of the Class L Shares of each Fund, as
applicable. JPMDS may enter into service agreements with Financial
Intermediaries under which it will pay all or a portion of the annual fee to
such Financial Intermediaries for performing shareholder and administrative
services.
The
Funds’ Distributor
JPMDS (the
Distributor) is the distributor for the Funds. The Distributor is an affiliate
of JPMIM.
Additional
Compensation to Financial Intermediaries
JPMIM, JPMDS
and, from time to time, other affiliates of JPMorgan Chase may also, at their
own expense and out of their own legitimate profits, provide additional cash
payments to Financial Intermediaries whose customers invest in shares of the
J.P. Morgan Funds. For this purpose, Financial Intermediaries include financial
advisors, investment advisers, brokers, financial planners, banks, insurance
companies, retirement or 401(k) plan administrators and others, including
various affiliates of JPMorgan Chase, that have entered into agreements with
JPMDS. These additional cash payments are payments over and above any sales
charges (including Rule 12b-1 fees) and service fees (including, sub-transfer
agency and/or networking fees) that are paid to such Financial Intermediaries,
as described elsewhere in this prospectus. These additional cash payments are
generally made to Financial Intermediaries that provide shareholder,
sub-transfer agency or administrative services or marketing support. Marketing
support may include access to sales meetings, sales representatives and
Financial Intermediary management representatives, inclusion of the J.P. Morgan
Funds on a sales list, including a preferred or select sales list, or other
sales programs and/or for training and educating a Financial Intermediary’s
employees. These additional cash payments also may be made as an expense
reimbursement in cases where the Financial Intermediary provides shareholder
services to J.P. Morgan Fund shareholders. JPMIM and JPMDS may also pay cash
compensation in the form of finders’ fees that vary depending on the J.P. Morgan
Fund and the dollar amount of shares sold. Such additional compensation may
provide such Financial Intermediaries with an incentive to favor sales of shares
of the J.P. Morgan Funds over other investment options they make available to
their customers. See the Statement of Additional Information for more
information.
| 91
Investing
with J.P. Morgan Funds
Choosing
A Share Class
Each share
class represents an investment in the same portfolio of securities, but each has
different availability and eligibility criteria, sales charges, expenses,
dividends and distributions. These arrangements allow you to choose the
available class that best meets your needs. You should read this section
carefully to determine which share class is best for you. Factors you should
consider in choosing a share class include:
●
The amount
you plan to invest;
●
The length of
time you expect to hold your investment;
●
The total
costs associated with your investment, including any sales charges that you pay
when you buy or sell your Fund shares and expenses that are paid out of Fund
assets over time;
●
Whether you
qualify for any reduction or waiver of sales charges;
●
Whether you
plan to take any distributions in the near future;
●
The
availability of the share class;
●
The services
that will be available to you;
●
The amount of
compensation that your Financial Intermediary will receive; and
●
The
advantages and disadvantages of each share class.
Please read
this prospectus carefully, and then select the Fund and share class most
appropriate for you and decide how much you want to invest. Each Fund may offer
other classes of shares not included in this prospectus that have different
expense levels, performance and eligibility requirements from the share classes
offered in this prospectus. In addition, each Fund may have a similar name,
investment objective and policies as other funds and ETFs advised by the adviser
or its affiliates that may have different expense levels, performance and
eligibility requirements from the share classes offered in this prospectus.
Please visit www.jpmorganfunds.com/funddocuments to obtain more information
concerning these or other share classes, funds or ETFs. A Financial Intermediary
may receive different compensation based on the share class sold.
Additional
Information that Applies to All Accounts: If your
identity or the identity of any other person(s) authorized to act on your behalf
cannot be verified, or if potentially criminal activity is identified, the J.P.
Morgan Funds and the Distributor reserve the right to reject opening an account
for you, close your account, or take such other action they deem reasonable or
required by law.
Shares
of the Funds have not been registered for sale outside of the United States.
This prospectus is not intended for distribution to prospective investors
outside of the United States. The Funds generally do not market or sell shares
to investors domiciled outside of the United States, even, with regard to
individuals, if they are citizens or lawful permanent residents of the United
States.
92 | J.P.
Morgan U.S. Equity Funds
|
|
Class
A |
Class
C |
Class
I |
Class
L |
|
Eligibility1,2,3
|
May
be purchased by
the
general public4
|
May
be purchased by
the
general public5
|
May
be purchased by:
●Institutional
Investors
who
meet the
minimum
investment
requirements;
●Individuals
purchasing
directly
from the Fund
through
JPMorgan
Distribution
Services,
Inc.
(the “Distributor”)
and
meeting the
investment
minimum
requirements;
●Financial
Intermediaries
or any
other
organization,
including
affiliates of
JPMorgan
Chase & Co.
(JPMorgan
Chase),
authorized
to act in a
fiduciary,
advisory or
custodial
capacity for
its
clients or
customers;
●Brokerage
program of
a
Financial
Intermediary
that has
entered
into a written
agreement
with the
Distributor
to offer
such
shares (“Eligible
Brokerage
Program”);
and
●Employees
of
JPMorgan
Chase and
its
affiliates and
officers
or trustees of
the
J.P. Morgan
Funds.6
|
Limited
to certain
investors,
including:11
●Purchases
directly
from
the Fund
through
the
Distributor
by
institutional
investors
such
as corporations,
pension
and profit
sharing
plans and
foundations
that meet
the
minimum
investment
requirements;
and
●Purchases
through
your
Financial
Intermediary
or any
other
organization,
including
affiliates of
JPMorgan
Chase
authorized
to act in a
fiduciary,
advisory or
custodial
capacity for
its
clients or
customers.
|
November
1, 2024 | 93
Investing
with J.P. Morgan Funds
(continued)
|
|
Class
A |
Class
C |
Class
I |
Class
L |
|
Minimum
Investment1,
7,
8
|
$1,000
for each Fund or
$50,
if establishing a
monthly
$50 Systematic
Investment
Plan9
|
$1,000
for each Fund or
$50,
if establishing a
monthly
$50 Systematic
Investment
Plan9
|
$1,000,000
– An
investor
can combine
purchases
of Class I
Shares
of other J.P.
Morgan
Funds in order
to
meet the minimum.
$1,000
for each Fund or
$50,
if establishing a
monthly
$50 Systematic
Investment
Plan for
investments
through an
Eligible
Brokerage
Program.
$1,000
for each Fund or
$50
if establishing a
monthly
$50 Systematic
Investment
Plan9
for
investments
by
employees
of JPMorgan
Chase
and its affiliates
and
officers or trustees
of
the J.P. Morgan
Funds.6
|
$3,000,000
– An
investor
can combine
purchases
of Class L
Shares
of other J.P.
Morgan
Funds in order
to
meet the minimum. |
|
Minimum
Subsequent
Investments1
|
$5010
|
$5010
|
No
minimum except $50
for
investments by
employees
of JPMorgan
Chase
and its affiliates
and
officers or trustees
of
the J.P. Morgan Funds
and
investments
through
an Eligible
Brokerage
Program. |
No
minimum |
|
Systematic
Investment
Plan |
Yes |
Yes |
No,
except for
investments
by
employees
of JPMorgan
Chase
and its affiliates
and
officers or trustees
of
the J.P. Morgan Funds
and
investments
through
an Eligible
Brokerage
Program. |
No |
|
Systematic
Redemption
Plan |
Yes |
Yes |
No,
except for
investments
by
employees
of JPMorgan
Chase
and its affiliates
and
officers or trustees
of
the J.P. Morgan Funds. |
No
|
94 | J.P.
Morgan U.S. Equity Funds
|
|
Class
A |
Class
C |
Class
I |
Class
L |
|
Front-End
Sales Charge
(refer
to Sales Charges
and
Financial
Intermediary
Compensation
Section
for
more details) |
Up
to 5.25% reduced or
waived
for large
purchases
and certain
investors,
eliminated for
purchases
of $1 million
or
more. |
None |
None |
None |
|
Contingent
Deferred
Sales
Charge (CDSC)
(refer
to Sales Charges
and
Financial
Intermediary
Compensation
Section
for
more details) |
On
purchases of
$1
million or more:
●1.00%
on
redemptions
made
within
12 months after
purchase.
●0.50%
on
redemptions
made
between
12 and 18
months
after
purchase.
Waived
under certain
circumstances. |
●1.00%
on
redemptions
made
within
12 months after
purchase.
Waived
under certain
circumstances. |
None |
None |
|
Distribution
(12b-1) Fee |
0.25%
of the average
daily
net assets. |
0.75%
of the average
daily
net assets. |
None |
None |
|
Service
Fee |
0.25%
of the average
daily
net assets. |
0.25%
of the average
daily
net assets. |
0.25%
of the average
daily
net assets. |
0.10%
of the average
daily
net assets. |
|
Redemption
Fee |
None |
None |
None |
None |
|
Conversion
Feature12 |
None |
Class
C Shares will be
converted
to Class A
Shares
in the following
instances:
●If
an investor is
eligible
to purchase
Class
A Shares, then
their
Class C Share
positions
will convert
to
Class A Shares after
8
years, calculated
from
the first day of
the
month of
purchase
and
processed
on the
tenth
business day of
the
anniversary
month.
●If
Class C Shares held
in
an account with a
third
party broker of
record
are transferred
to a
Fund direct
account
with no
broker
of record,
those
Class C Shares
will
be converted to
Class
A Shares on the
tenth
business day of
the
month following
the
transfer. |
None |
None
|
November
1, 2024 | 95
Investing
with J.P. Morgan Funds
(continued)
|
|
Class
A |
Class
C |
Class
I |
Class
L |
|
Advantages |
If
you are eligible to
have
the sales charge
reduced
or eliminated or
you
have a long-term
investment
horizon,
these
shares have lower
distribution
fees over a
longer
term investment
horizon
than Class C
Shares. |
No
front-end sales
charge
is assessed so
you
own more shares
initially.
These shares
may
make sense for
investors
who have a
shorter
investment
horizon
relative to
Class
A Shares. |
No
front-end sales
charge
or CDSC is
assessed
so you own
more
shares initially. In
addition,
Class I Shares
have
lower fees than
Class
A and Class C
Shares. |
No
front-end sales
charge
or CDSC is
assessed
so you own
more
shares initially. In
addition,
Class L Shares
have
the lowest fee
structure
of the shares
offered
in this
prospectus. |
|
Disadvantages |
A
front-end sales charge
is
generally assessed,
diminishing
the number
of
shares owned. If you
are
eligible to have the
sales
charge reduced or
eliminated,
you may be
subject
to a CDSC.
Class
A Shares may not
make
sense for investors
who
have a shorter
investment
horizon
relative
to Class C
Shares. |
Shares
are subject to
CDSC
and have higher
ongoing
distribution
fees.
This means that
over
the long term
Class
C Shares accrue
higher
fees than Class A
Shares. |
Limited
availability and
higher
minimum initial
investment
than Class A
and
Class C Shares. |
Limited
availability and
higher
minimum initial
investment
than Class A,
Class
C and Class I
Shares.
Not all Funds
have
Class L Shares. |
1
Financial
Intermediaries or other organizations making the Funds available to their
clients or customers may impose minimums which may be different from the
requirements for investors purchasing directly from the Fund.
2
Certain Retirement Plans may
purchase shares. For more information, see “ELIGIBLE RETIREMENT PLANS”
below.
3
Certain Funds
and/or classes are subject to limited offering. Please see the FUNDS SUBJECT TO
A LIMITED OFFERING section for more information about applicable limited
offerings.
4
Effective November 2, 2020,
employees of JPMorgan Chase and its affiliates and officers or trustees of the
J.P. Morgan Funds are no longer eligible to purchase Class A Shares in Fund
direct accounts where there is no broker of record. Employees for this purpose
include officers, directors, trustees, retirees and employees and their
immediate family members (i.e., spouses, domestic partners, children,
grandchildren, parents, grandparents and any dependent of the person, as defined
in section 152 of the Internal Revenue Code) of J.P. Morgan Funds or JPMorgan
Chase and its subsidiaries and affiliates.
5
Investors who hold shares in a
Fund direct accounts where there is no broker of record are no longer eligible
to purchase Class C Shares. In addition, shareholders are ineligible to hold
Class C Shares if they are eligible for conversion to Class A
Shares.
6
Must be
purchased directly from the Funds or on approved JPMorgan Chase & Co.
affiliated platforms. Employees for this purpose include officers, directors,
trustees, retirees and employees and their immediate family members (i.e.,
spouses, domestic partners, children, grandchildren, parents, grandparents and
any dependent of the person, as defined in section 152 of the Internal Revenue
Code) of J.P. Morgan Funds or JPMorgan Chase and its subsidiaries and
affiliates. Approved affiliated platforms may impose minimums which may be
different from the requirements for investors purchasing directly from the
Fund.
7
Investment
minimums may be waived for certain types of Group Retirement Plans, as well as
for certain fee-based programs. The Funds and/or the Distributor reserve the
right to waive any initial or subsequent investment minimum.
8
Please see
“MINIMUM ACCOUNT BALANCE” for more information about minimum balance
requirements.
9
You are
eligible for the lower $50 initial investment amount as long as you agree to
make regular monthly investments of at least $50 until you reach the required
$1,000 investment amount per fund. Once the required amount is reached, you must
maintain the minimum $1,000 investment in the Fund.
10
Minimum
subsequent investment amount for Systematic Investment Plans established before
3/1/15 is $25.
11
The Class L
Shares are publicly offered on a limited basis. Please see “Limited Offering of
the Class L Shares” for more information.
12
Please see
“Class C Shares Conversion Feature” for more information about the conversion
feature.
Eligible
Retirement Plans
The only
retirement plans that are eligible to purchase Class A, Class C, Class I and
Class L Shares are the following:
●
Employer
sponsored retirement, deferred compensation, employee benefit plans (including
health savings accounts) and trusts used to fund those plans held directly at a
broker dealer or financial intermediary (that is outside of retirement plan
record
96 | J.P.
Morgan U.S. Equity Funds
keeping or
third party administrator platform). Employer sponsored plans include 401(k)
plans, 457 plans, 403(b) plans, profit-sharing and money purchase pension plans,
defined benefit plans, retiree health benefit plans, group annuity separate
accounts offered to retirement plans, and non-qualified deferred compensation
plans. Purchases may be subject to applicable sales charges as described in this
prospectus.
●
Group Retirement Plans (and
their successor, related, and affiliated plans) which have these share classes
available to participants on or before April 3, 2017, may continue to open
accounts for new participants in such share classes of a Fund and purchase
additional shares in existing participant accounts.
●
Group Retirement Plans (or
financial intermediary platforms available to Group Retirement Plans) that were
approved by a Fund and the Distributor after April 3, 2017 and before December
31, 2018 because the particular Group Retirement Plan had operational
difficulties in implementing the eligibility restrictions may continue to
purchase Class A, Class C, Class I or Class L Shares of the Funds.
●
Select Financial
Intermediaries, which have received written approval from a Fund on behalf of
existing Group Retirement Plan Participants that hold Class C Shares, may
purchase Class A Shares.
All other new
Group Retirement Plans are no longer eligible to purchase these share
classes.
Sales
Charges and Financial Intermediary Compensation
The following
section describes the various sales charges and other fees that you will pay if
you purchase shares of the Funds. In addition, it describes the types of
compensation paid to Financial Intermediaries for the sale of Fund shares and
related services. The Funds and/or the Distributor reserve the right to change
sales charges, commissions and finder’s fees at any time.
To obtain
information regarding sales charges and the reduction, and elimination or waiver
of sales charges on Class A and Class C Shares of the J.P. Morgan Funds, see
below, visit www.jpmorganfunds.com or call 1-800-480-4111. You may contact your
Financial Intermediary about the reduction, elimination or waiver of sales
charges. You may also contact your Financial Intermediary about any commissions
charged by them on your purchase of Class I Shares.
Class
A Shares
The public
offering price of Class A Shares of each Fund is the net asset value (NAV) per
share plus the applicable sales charge, unless you qualify for a waiver of the
sales charge. The sales charge is allocated between your Financial Intermediary
and the Distributor as shown in the tables below, except if the Distributor, in
its discretion, re-allows the entire amount to your Financial Intermediary. In
those instances in which the entire amount is re-allowed, such Financial
Intermediaries may be deemed to be underwriters under the Securities Act of
1933.
The table
below shows the front-end sales charge you would pay at different levels of
investment, the commission paid to Financial Intermediaries, any finder’s fees
paid to Financial Intermediaries and any applicable CDSC. Purchases at certain
dollar levels, known as “breakpoints,” allow for a reduction in the front-end
sales charge.
|
Class
A Shares
Amount
of Investment |
Sales
Charge
as
a % of
Offering
Price |
Sales
Charge
as
a % of your
Investment1 |
Commission
as
a % of
Offering
Price2 |
CDSC |
|
Less
than $50,000 |
5.25 |
5.54 |
4.75 |
0.00 |
|
$50,000
to $99,999 |
4.50 |
4.71 |
4.05 |
0.00 |
|
$100,000
to $249,999 |
3.50 |
3.63 |
3.05 |
0.00 |
|
$250,000
to $499,999 |
2.50 |
2.56 |
2.05 |
0.00 |
|
$500,000
to $999,999 |
2.00 |
2.04 |
1.60 |
0.00 |
|
Amount
of Investment |
Sales
Charge
as
a % of
Offering
Price |
Sales
Charge
as
a % of your
Investment |
Finder’s
Fee
as
a % of your
Investment3 |
CDSC
as
a % of your
Redemption3,4 |
|
$1,000,000
to $3,999,999 |
0.00 |
0.00 |
1.00 |
0-12
months — 1.00%
12-18
months — 0.50% |
|
$4,000,000
to $9,999,999 |
0.00 |
0.00 |
0.75 | |
|
$10,000,000
to $49,999,999 |
0.00 |
0.00 |
0.50 | |
|
$50,000,000
or more |
0.00 |
0.00 |
0.25 |
1
The actual
sales charge you pay may differ slightly from the rates disclosed above due to
rounding calculations.
2
The sales
charge is allocated between your Financial Intermediary and the Distributor. The
Distributor, at its discretion, may re-allow the entire sales charge to
November
1, 2024 | 97
Investing
with J.P. Morgan Funds
(continued)
your Financial
Intermediary; in those instances such Financial Intermediaries may be deemed to
be underwriters under the Securities Act of 1933.
3
The
Distributor or its affiliates pays any finder’s fee to your Financial
Intermediary. The Distributor or its affiliates may withhold finder’s fees with
respect to short-term investments.
4
Please see the
“Exchanging Fund Shares” section for details regarding CDSC and
exchanges.
The
Distributor may also pay Financial Intermediaries a finder’s fee on sales to
defined contribution plans with no minimum investment amount.
Finder’s
Fee Schedule for Defined Contribution Plans
|
Class
A Shares
Amount
of Investment |
Sales
Charge
as
a % of
Offering
Price |
Sales
Charge
as
a % of your
Investment |
Finder’s
Fee
as
a % of your
Investment |
CDSC
as
a % of your
Redemption1 |
|
$0
to $3,999,999 |
0.00 |
0.00 |
1.00 |
0.00 |
|
$4,000,000
to $9,999,999 |
0.00 |
0.00 |
0.75 |
0.00 |
|
$10,000,000
to $49,999,999 |
0.00 |
0.00 |
0.50 |
0.00 |
|
$50,000,000
or more |
0.00 |
0.00 |
0.25 |
0.00 |
1
If a plan
redeems the shares of certain funds for which a finder’s fee has been paid
within 18 months of the purchase date, no CDSC is charged; however, the
Distributor reserves the right to reclaim the finder’s fee paid to the Financial
Intermediary.
Class
C Shares
The table
below shows the amount of sales charge, commission paid and any CDSC that may be
charged.
|
Class
C Shares
Amount
of Investment |
Sales
Charge
as
a % of
Offering
Price |
Sales
Charge
as
a % of your
Investment |
Commission
as
a % of
Offering
Price |
CDSC
as
a % of
your
Redemption |
|
All
Investments |
0.00 |
0.00 |
1.00 |
0-12
months —1.00% |
Class
I and Class L Shares
There is no
sales charge, commission or CDSC associated with Class I or Class L
Shares.
Reducing
Your Class A Sales Charges
Each Fund
permits you to reduce the front-end sales charge you pay on Class A Shares by
exercising your Rights of Accumulation or Letter of Intent privileges. Both of
these are described below.
Rights
of Accumulation: For Class A
Shares, a front-end sales charge can be reduced by breakpoint discounts based on
the amount of a single purchase or through Rights of Accumulation. By using
Rights of Accumulation, you may combine the current market value of any existing
qualifying holdings and account types (as described below) with the amount of
the current purchase to qualify for a breakpoint and reduced sales charge on the
current purchase.
The amount of
the sales charge will be calculated based on the higher of (a) the market value
of your qualified holdings as of the last calculated NAV prior to your
investment or (b) if you purchased shares after July 3, 2017, the initial value
of total share purchases, or if you already held shares on July 3, 2017, the
market value of the shares on that date, provided that, in either case, the
value will be reduced by the market value on the applicable redemption date of
any shares you have redeemed. Depending on their operational capabilities,
Financial Intermediaries may utilize one or both of the methods described above
so your holdings could be valued differently depending on where you hold your
shares.
Letter
of Intent: By signing a
Letter of Intent, you may combine the current market value of any existing
qualifying holdings and account types with the value that you intend to buy over
a 13 month period to calculate the front-end sales charge and any breakpoint
discounts. Each purchase that you make during that 13 month period will receive
the sales charge and breakpoint discount that applies to the total amount. The
13 month Letter of Intent period commences on the day that the Letter of Intent
is received by the J.P. Morgan Funds or your Financial Intermediary, and you
must inform your Financial Intermediary or the J.P. Morgan Funds that you have a
Letter of Intent each time you make an investment. Purchases submitted prior to
the date on which the Letter of Intent is received by the J.P. Morgan Funds or
your Financial Intermediary are considered only in determining the level of
sales charge that will be paid. The Letter of Intent will not result in a
reduction in the amount of any previously paid sales charges.
98 | J.P.
Morgan U.S. Equity Funds
A percentage of your
investment will be held in escrow until the full amount covered by the Letter of
Intent has been invested. If the terms of the Letter of Intent are not fulfilled
by the end of the 13th month, you must pay the Distributor the difference
between the sales charges applicable to the purchases at the time they were made
and the reduced sales charges previously paid or the Distributor will liquidate
sufficient escrowed shares to obtain the difference and/or adjust the
shareholder’s account to reflect the correct number of shares that would be held
after deduction of the sales charge. The Letter of Intent will be considered
completed if the shareholder dies within the 13 month period covered by the
Letter of Intent. Commissions to dealers will not be adjusted or paid on the
difference between the Letter of Intent amount and the amount actually invested
before the shareholder’s death. Calculations to determine whether a Letter of
Intent commitment has been fulfilled will be made on the basis of the amount
invested prior to the deduction of any applicable sales charge.
Below
are the qualifying holdings and account types that may be aggregated in order to
exercise your Rights of Accumulation and Letter of Intent privileges to qualify
for a reduced front-end sales charge on Class A Shares.
Qualifying
Holdings: Class
A, Class C, Class I, Class L Shares and Class R6 Shares (only when used in
advisory programs) of the J.P. Morgan
Funds; Class A,
Class C and the Advisor Class units in New York’s 529 Advisor-Guided College
Savings Program (NY 529 Advisor-Guided
Plan); and Class
A, Class C and Class Z units of the Future Path 529 Plan. Investments in the
JPMorgan 529 Stable Asset
Income Portfolio and Future Path 529 JPMorgan Stable Asset Income Portfolio are
not included.
Qualifying
Accounts:
1.
Your
account(s);
2.
Account(s) of
your spouse or domestic partner;
3.
Account(s) of
children under the age of 21 who share your residential address;
4.
Trust
accounts established by any of the individuals in items (1) through (3) above.
If the person(s) who established the trust is deceased, the trust account may be
aggregated with the account(s) of the primary beneficiary of the
trust;
5.
Solely
controlled business accounts; and
6.
Single-participant
retirement plans of any of the individuals in items (1) through (3)
above.
You may use
your qualifying holdings and account types even if they are held at different
Financial Intermediaries.
In order to obtain any reduction in the sales charge by utilizing either the
Rights of Accumulation or Letter of Intent privileges, you must, before each
purchase of Class A Shares, inform your Financial Intermediary or the J.P.
Morgan Funds if you have any existing holdings that may be aggregated with your
current purchase in order to qualify for a reduced front-end sales
charge.
In order to
verify your eligibility for a reduced sales charge, you may be required to
provide appropriate documentation, such as an account statement or the social
security or tax identification number on an account, so that J.P. Morgan Funds
may confirm (1) the value of each of your accounts invested in J.P. Morgan Funds
or in the NY 529 Advisor-Guided Plan or Future Path 529 Plan and (2) the value
of the accounts owned by your spouse or domestic partner and by children under
the age of 21 who share your residential address.
Certain
Financial Intermediaries may not participate in extending the Rights of
Accumulation or Letter of Intent privileges to your holdings in the NY 529
Advisor-Guided Plan or Future Path 529 Plan. Please check with your Financial
Intermediary to determine whether the Financial Intermediary makes these
privileges available with respect to NY 529 Advisor-Guided Plan and Future Path
529 Plan investments.
Additional
information regarding the reduction of Class A sales charges is available in a
Fund's Statement of Additional Information. To determine if you are eligible for
Rights of Accumulation or Letter of Intent privileges or to request a copy of
the Statement of Additional Information, call 1-800-480-4111. These programs may
be terminated or amended at any time.
Sales
Charge Waivers
The availability of certain
sales charge waivers and discounts will depend on whether you purchase your
shares directly from a Fund or on a Financial Intermediary platform. Financial
Intermediaries may have different policies and procedures regarding the
availability of front-end sales load waivers or contingent deferred (back-end)
sales load (CDSC) waivers, which are discussed in Appendix A. Except as
described in Appendix A, purchases will be subject to the waivers or discounts
discussed below.
Waiver
of the Class A Sales Charge
No sales
charge is imposed on Class A Shares of the Funds if the shares were:
1.
Bought with
the reinvestment of dividends and capital gains distributions.
November
1, 2024 | 99
Investing
with J.P. Morgan Funds
(continued)
2.
Acquired in
exchange for shares of another J.P. Morgan Fund if a comparable sales charge has
been paid for the exchanged shares.
3.
Bought
through a Financial Intermediary and not directly from the Funds by officers,
directors, trustees, retirees and employees, and their immediate family members
(i.e., spouses, domestic partners, children, grandchildren, parents,
grandparents and any dependent of the person, as defined in Section 152 of the
Internal Revenue Code) of:
●
J.P. Morgan
Funds.
●
JPMorgan
Chase and its subsidiaries and affiliates.
Former
employees and their immediate family members can make subsequent purchases in
accounts established during the employees’ employment. Officers, directors,
trustees, retirees and employees, and their immediate family members of J.P.
Morgan Funds and JPMorgan Chase and its subsidiaries and affiliates may open new
Class I Share accounts subject to a $1,000 minimum investment requirement
provided such accounts are opened directly from the Funds and not through a
Financial Intermediary. Class I Shares have lower expenses than Class A Shares.
Please call 1-800-480-4111 for more information concerning all of the Funds’
other share classes.
4.
Bought by
employees of:
●
DST Asset
Manager Solutions, Inc. and its subsidiaries and affiliates.
●
Financial
Intermediaries or financial institutions that have entered into dealer
agreements with the Funds or the Distributor and their subsidiaries and
affiliates (or otherwise have an arrangement with a Financial Intermediary or
financial institution with respect to sales of Fund shares). This waiver
includes the employees’ immediate family members (i.e., spouses, domestic
partners, children, grandchildren, parents, grandparents and any dependent of
the employee, as defined in Section 152 of the Internal Revenue
Code).
5.
Bought
by:
●
Employer
sponsored retirement, deferred compensation, employee benefit plans (including
health savings accounts) and trusts used to fund those plans. Employer sponsored
plans include 401(k) plans, 457 plans, 403(b) plans, profit-sharing and money
purchase pension plans, defined benefit plans, retiree health benefit plans and
non-qualified deferred compensation plans. Traditional IRAs, Roth IRAs,
Coverdell Education Savings Accounts, SEPs, SARSEPs, SIMPLE IRAs and KEOGHs
plans do not qualify under this waiver.
●
Financial
Intermediaries, including affiliates of JPMorgan Chase, who have a dealer
arrangement with the Distributor, act in a custodial capacity, or who place
trades for their own accounts or for the accounts of their clients and who
charge a management, asset allocation, consulting, or other fee for their
services.
●
Financial
Intermediaries who have entered into an agreement with the Distributor and have
been approved by the Distributor to offer Fund shares to investment brokerage
programs in which the end shareholder makes investment decisions independent of
a financial advisor; these programs may or may not charge a transaction
fee.
●
Tuition
programs that qualify under Section 529 of the Internal Revenue
Code.
●
A bank, trust
company or thrift institution which is acting as a fiduciary exercising
investment discretion, provided that appropriate notification of such fiduciary
relationship is reported at the time of the investment to a Fund or a Fund’s
Distributor.
6.
Bought in
connection with plans of reorganization of a J.P. Morgan Fund, such as mergers,
asset acquisitions and exchange offers to which a Fund is a party. However, you
may pay a CDSC when you redeem the Fund shares you received in connection with
the plan of reorganization.
7.
Purchased in
Individual Retirement Accounts (IRAs) established prior to September 2,
2014:
i.
That were
established through a rollover from a qualified retirement plan for which J.P.
Morgan Retirement Plan Services LLC had a contractual relationship to provide
recordkeeping for the plan (an “RPS Rollover IRA”) or an IRA that was
subsequently established in connection with the RPS Rollover IRA;
ii.
Where there is no
broker of record
for the IRA; and
iii.
Where UMB
Bank, n.a. continues to serve as custodian for the IRA.
8. Purchased in an account
where there is no broker of record as of April 10, 2017.
100 | J.P.
Morgan U.S. Equity Funds
To determine
if you qualify for a sales charge waiver, call 1-800-480-4111 or contact your
Financial Intermediary. These waivers may not continue indefinitely and may be
discontinued at any time without notice.
Contingent
Deferred Sales Charge (CDSC)
Certain
redemptions of Class A and Class C Shares are subject to a CDSC. Please see
“SALES CHARGES AND FINANCIAL INTERMEDIARY COMPENSATION” for the amount of the
applicable CDSC. The CDSC is calculated by multiplying the original cost of the
shares by the CDSC rate. For Class A Shares, the CDSC is calculated from the
date of the purchase of the applicable shares. For Class C Shares, the Fund
assumes that all purchases made in a given month were made on the first day of
the month.
No CDSC is
imposed on share appreciation, nor is a CDSC imposed on shares acquired through
reinvestment of dividends or capital gains distributions.
To keep your
CDSC as low as possible, the Funds will first redeem any shares that are not
subject to a CDSC (i.e., shares that have been held for longer than the CDSC
period or shares acquired through reinvestment of dividends or capital gains
distributions), followed by the shares held for the longest time. You should
retain any records necessary to substantiate historical costs because the
Distributor, the Funds, the transfer agent and your Financial Intermediary may
not maintain such information.
If you
received Fund shares in connection with a fund reorganization, the CDSC
applicable to your original shares (including the period of time you have held
those shares) will be applied to the shares received in the
reorganization.
Waiver
of the Class A and Class C CDSC
No CDSC is
imposed on redemptions of shares:
1.
If you
participate in a Systematic Redemption Plan and withdraw no more than the amount
permitted to be withdrawn without a CDSC. Please refer to Systematic Redemption
Plan in the “HOW TO REDEEM” table below.
2.
Made due to
the death or disability of a shareholder. For shareholders that become disabled,
the redemption must be made within one year of initial qualification for Social
Security disability payments or within one year of becoming disabled as defined
in section 72(m)(7) of the Internal Revenue Code. This waiver is only available
for accounts opened prior to the shareholder’s disability. In order to qualify
for the waiver, the Distributor must be notified of the death or disability at
the time of the redemption order and be provided with satisfactory evidence of
such death or disability.
3.
That
represent a Required Minimum Distribution from your IRA Account or other
qualifying retirement plan. The waiver only applies to the pro rata required
minimum distribution amount from the assets invested in one or more of the J.P.
Morgan Funds.
4.
That are part
of a J.P. Morgan Fund-initiated event, such as mergers, liquidations, asset
acquisitions, and exchange offers to which a Fund is a party, or result from a
failure to maintain the required minimum balance in an account. However, you may
pay a sales charge when you redeem the Fund shares you received in connection
with the Fund-initiated event.
5.
Exchanged
into the same share class of other J.P. Morgan Funds. Your new Fund will be
subject to the CDSC of the Fund from which you exchanged and the current holding
period is carried over to your new shares. Please read “Exchanging Fund Shares”
for more information.
6.
For Class C
Shares only, if your Financial Intermediary has notified the Distributor before
you invest that it is waiving its commission.
7.
Sold as a
return of excess contributions from an IRA Account.
8.
Sold to pay
the Distributor or a Financial Intermediary account-related fees (only if the
transaction is initiated by the Distributor or the Financial
Intermediary).
To see if you
qualify for a CDSC waiver, call 1-800-480-4111 or contact your Financial
Intermediary. These waivers may not continue indefinitely and may be
discontinued at any time without notice.
Repurchase
Rights
If you redeem
shares in a mutual fund, Repurchase Rights may allow you to reinvest all or a
portion of the redemption proceeds or repurchase shares at NAV if the purchase
is made within 90 days of the sale or distribution. In order to take advantage
of Repurchase Rights, you must inform your Financial Intermediary or J.P. Morgan
Funds you wish to do so at the time of purchase. This policy does not apply to
systematic purchases.
There is no
sales charge on:
November
1, 2024 | 101
Investing
with J.P. Morgan Funds
(continued)
●
Class A
Shares if they are bought with proceeds from the sale of Class A Shares of a
J.P. Morgan Fund
●
Class A
Shares if they are bought with proceeds from the sale of Class I Shares or Class
L Shares of a J.P. Morgan Fund
●
Class A
Shares if they are bought with proceeds from the sale of Class R6 Shares of a
J.P. Morgan Fund held in a fee-based advisory account
●
Class A
Shares if they are bought with proceeds from the sale of Morgan Shares of a J.P.
Morgan Money Market Fund, provided that the Morgan Shares were acquired from
Class A Shares where a sales charge was paid or waived
In addition,
if you repurchase Class C Shares within 90 days of a redemption, there will be
no CDSC on the new Class C Shares.
Rule
12b–1 Fees
Each Fund
described in this prospectus has adopted a Distribution Plan under Rule 12b-1
with respect to Class A and Class C Shares that allows it to pay distribution
fees for the sale and distribution of these shares of the Funds. These fees are
called “Rule 12b-1 fees.” Rule 12b-1 fees are paid by the Funds to the
Distributor as compensation for its services and expenses in connection with the
sale and distribution of Fund shares. The Distributor in turn pays all or part
of these Rule 12b-1 fees to Financial Intermediaries that have agreements with
the Distributor to sell shares of the Funds. The Distributor may pay Rule 12b-1
fees to its affiliates. Payments are not tied to actual expenses
incurred.
The Rule
12b-1 fees (based on average daily net assets of the share class) vary by share
class as follows:
|
Class |
Rule
12b-1 Fee |
|
Class
A |
0.25% |
|
Class
C |
0.75% |
|
Class
I |
None |
|
Class
L |
None |
Rule 12b-1
fees, together with the CDSC, help the Distributor sell Class C Shares without
an upfront sales charge by defraying the costs of advancing brokerage
commissions and other expenses paid to Financial Intermediaries.
Because Rule
12b-1 fees are paid out of Fund assets on an ongoing basis, over time these fees
will increase the cost of your investment and may cost you more than paying
other types of sales charges.
With respect
to Class A Shares transactions, for purchases at NAV where the Distributor paid
a finder’s fee at the time of the purchase, the selling Financial Intermediary
will start to receive the applicable Rule 12b-1 fee in the 13th month after the
sale and the Distributor will retain the Rule 12b-1 fees during such
period.
Service
Fees
JPMDS, as
shareholder servicing agent, receives an annual fee of up to the following fee
(based on the average daily net assets of the applicable class of a
Fund).
|
Class |
Service
Fee |
|
Class
A |
0.25% |
|
Class
C |
0.25% |
|
Class
I |
0.25% |
|
Class
L |
0.10% |
JPMDS may
enter into service agreements with Financial Intermediaries under which it will
pay all or a portion of that fee to such Financial Intermediaries for performing
shareholder and administrative services.
Networking
and Sub-Transfer Agency Fees
JPMDS, as
shareholder servicing agent, has entered into agreements with Financial
Intermediaries pursuant to which the Financial Intermediary is paid for services
such as networking or sub-transfer agency (collectively, the “Sub-TA
Agreements”). Sub-TA Agreement payments are generally based on either (1) a
percentage of the average daily net assets of clients serviced by such Financial
Intermediary up to a set maximum dollar amount per shareholder account serviced,
or (2) a per account fee based on the number of accounts serviced by such
Financial Intermediary. Sub-TA Agreement payments are in addition to, rather
than in lieu of, Rule 12b-1 fees the Financial Intermediary may also be
receiving pursuant to agreements with the Distributor for classes with Rule
12b-1 fees.
102 | J.P.
Morgan U.S. Equity Funds
Payments to
Financial Intermediaries for sub-transfer agency services will be made by JPMDS,
as shareholder servicing agent, from the service fee. From time to time, JPMIM
or its affiliates may pay a portion of the sub-transfer agency fees at its or
their own expense and out of its or their legitimate profits.
Conversion
Feature for Certain Class A Shares Held by Employees
Effective
November 2, 2020, employees were no longer eligible to purchase Class A Shares
in accounts where the Distributor is broker of record. Therefore, Class A Shares
held by employees in such accounts with the Distributor were converted to Class
I Shares beginning on November 6, 2020. Employees include officers, directors,
trustees, retirees and employees, and their immediate family members (i.e.,
spouses, domestic partners, children, grandchildren, parents, grandparents and
any dependent of the person, as defined in Section 152 of the Internal Revenue
Code) of J.P. Morgan Funds and JPMorgan Chase and its subsidiaries and
affiliates.
Because the
share price of the Class I Shares may be higher than that of the Class A Shares
at the time of conversion, you may receive fewer Class I Shares; however, the
dollar value will be the same. After conversion, your new shares will no longer
be subject to Rule 12b-1 fees charged on Class A Shares. You will not be
assessed any sales charges, fees or other charges for the conversion of the
shares, nor will you be subject to any federal income tax as a result of the
conversion.
Class
C Shares Conversion Feature
Class C
Shares will be converted to Class A Shares in the following
instances:
●
If an
investor is eligible to purchase Class A Shares, then their Class C Share
positions will convert to Class A Shares after 8 years, calculated from the
first day of the month of purchase and processed on the tenth business day of
the anniversary month.
●
If Class C Shares held in an
account with a third party broker of record are transferred to a Fund direct
account with no broker of record, those Class C Shares will be converted to
Class A Shares on the tenth business day of the month following the
transfer.
Because the
share price of the Class A Shares may be higher than that of the Class C Shares
at the time of conversion, you may receive fewer Class A Shares; however, the
dollar value will be the same.
After
conversion, your new shares will be subject to the lower Rule 12b-1 fees charged
on Class A Shares. You will not be assessed any sales charges, fees or other
charges for the conversion of shares, nor will you be subject to any federal
income tax as a result of the conversion. You will not pay any CDSC when you
sell Class A Shares that have converted from Class C Shares.
Purchasing
Fund Shares
You may
purchase shares directly from the J.P. Morgan Funds through the Distributor or
through your Financial Intermediary.
This
prospectus offers multiple share classes. Each share class has different sales
charges and/or expenses. When deciding what share class to buy, you should
consider the amount of your investment, the length of time you intend to hold
the shares, the sales charges and expenses applicable to each share class and
whether you qualify for any sales charge discounts. Please refer to “Choosing a
Share Class” for investment minimums for initial and subsequent purchases and to
help you determine which share class would be best for you.
Purchase and redemption
orders will be accepted only on days that J.P. Morgan Funds are open for
business. The J.P. Morgan Funds are open for business on each day the NYSE is
open for trading. A purchase or redemption order received by the J.P. Morgan
Funds prior to the close of regular trading on the NYSE (normally 4:00 p.m. ET)
(Funds Close), on a day the J.P. Morgan Funds are open for business, will be
effected at that day’s NAV. The J.P. Morgan Funds will not treat an intraday
unscheduled disruption or closure in NYSE trading as a closure of the NYSE and
will calculate NAV as of 4:00 p.m. ET, if the particular disruption or closure
directly affects only the NYSE. An order received after the Funds Close will
generally be effected at the NAV determined on the next business day. However,
orders received by Financial Intermediaries on a business day prior to the Funds
Close and communicated to the J.P. Morgan Funds prior to such time as agreed
upon by the J.P. Morgan Funds and the Financial Intermediary will be effected at
the NAV determined on the business day the order was received by the Financial
Intermediary.
A purchase
order must be supported by all appropriate documentation and information in the
proper form. The J.P. Morgan Funds may refuse to honor incomplete purchase
orders.
Share
ownership is electronically recorded; therefore, no certificate will be issued.
A shareholder who purchases shares of a Fund that accrues dividends daily will
not accrue a dividend on the day of the purchase.
November
1, 2024 | 103
Investing
with J.P. Morgan Funds
(continued)
If you
purchase shares through your Financial Intermediary, contact your investment
representative for its requirements and procedures. If a Financial Intermediary
holds your shares, it is the responsibility of the Financial Intermediary to
send your purchase order to the J.P. Morgan Funds. Your Financial Intermediary
may have an earlier cut-off time for purchase orders.
If you
purchase shares directly with the Funds, see the information below.
|
HOW
TO PURCHASE DIRECTLY WITH THE J.P. MORGAN FUNDS | ||
|
|
Opening
a New Account |
Purchasing
into an Existing Account |
|
By
Phone or Online
1-800-480-4111
Shareholder
Services representatives
are
available Monday through Friday
from
8:00 am to 6:00 pm ET.
www.jpmorganfunds.com
Note:
Certain account types are not
available
for online account access.
Please
call for additional information. |
A
new account generally may not be
opened
by phone or online.
A
new fund position can be added to an
existing
account by phone or online if
you
have bank information on file. The
minimum
initial investment
requirement
must be met. |
You
must already have bank
information
on file. If we do not have
bank
information on file, you must
submit
written instructions. Please call
for
instructions on how to add bank
information
to your account. |
|
By
Mail
Regular
mailing address:
J.P.
Morgan Funds Services
P.O.
Box 219143
Kansas
City, MO 64121-9143
Overnight
mailing address:
J.P.
Morgan Funds Services
430
W 7th
Street, Suite 219143
Kansas
City, MO 64105-1407 |
Mail
the completed and signed
application
with a check to our Regular
or
Overnight mailing address.
Refer
to the Additional Information
Regarding
Purchases section. |
Please
mail your check and include
your
name, the Fund name, and your
fund
account number. |
|
All
checks must be made payable to one of the following:
●J.P.
Morgan Funds; or
●The
specific Fund in which you are investing.
Please
include your existing account number, if applicable.
All
checks must be in U.S. dollars. The J.P. Morgan Funds do not accept credit
cards,
cash,
starter checks, money orders or credit card checks. The Funds and/or the
Distributor
reserve the right to refuse “third-party” checks and checks drawn on
non-
U.S.
financial institutions even if payment may be effected through a U.S.
financial
institution.
Checks made payable to any individual or company and endorsed to J.P.
Morgan
Funds or a Fund are considered third-party
checks. | ||
|
By
ACH or Wire1
1-800-480-4111
Wire
Instructions:
DST
Asset Manager Solutions, Inc.
2000
Crown Colony Drive
Quincy,
MA 02169
Attn:
J.P. Morgan Funds Services
ABA:
021 000 021
DDA:
323 125 832
FBO:
Fund
Name
Fund:
Fund
#
Account:
Your
Account #
and
Your
Account Registration |
You
may include bank information on
your
application for your initial
purchase
to be processed via
Automated
Clearing House (ACH)
rather
than sending a check.
New
accounts cannot be opened by
wire
purchase. |
Purchase
by ACH: To process a
purchase
via ACH using bank
information
on file you may call us or
process
the purchase online.
Purchase
by Wire: If you choose to pay
by
wire, please call to notify the Fund
of
your purchase. You must also initiate
the
wire with your financial institution.
|
104 | J.P.
Morgan U.S. Equity Funds
|
HOW
TO PURCHASE DIRECTLY WITH THE J.P. MORGAN FUNDS | ||
|
|
Opening
a New Account |
Purchasing
into an Existing Account |
|
Systematic
Investment Plan1
|
You
may include instructions to set up
a
Systematic Investment Plan on your
application.
Bank Information must be
included.
Refer
to Choosing A Share Class for fund
minimums. |
If
bank information is on file, you may
call,
go online or mail written
instructions
to start, edit or delete a
Systematic
Investment Plan.
You
cannot have a Systematic
Investment
Plan and a Systematic
Redemption
Plan or Systematic
Exchange
Plan on the same fund
account.
If
bank information is not on file, you
will
be required to submit a completed
form
with your bank information and
Systematic
Investment Plan details. |
1
The Funds
currently do not charge for these services, but may impose a charge in the
future. However, your bank may impose a charge for debiting your bank
account.
Transactions
by phone, fax or internet
You may access your account
and conduct certain transactions using phone, fax or the J.P. Morgan Funds
website. Phone conversations are recorded. The J.P. Morgan Funds and their
agents use reasonable procedures to verify the identity of the shareholder. If
these procedures are followed, the J.P. Morgan Funds and their agents are not
liable for any losses, liability, cost or expenses (including attorney fees)
that may occur from acting on unauthorized or fraudulent instructions.
Therefore, please take precautions to protect your account information and
immediately review account statements or other information provided to you. In
addition, a confirmation is sent promptly after a transaction. Please review it
carefully and contact J.P. Morgan Funds Services or your Financial Intermediary
immediately about any transaction you believe to be unauthorized. If you
purchased shares directly with the J.P. Morgan Funds, you may revoke your right
to make purchases over the phone,
fax or internet
by mailing written instructions to us. If you purchased shares through your
Financial Intermediary, contact your investment representative regarding your
ability to revoke or modify your purchase rights.
You may not
always reach J.P. Morgan Funds Services by phone or online. This may be true at
times of unusual market changes and shareholder activity. You can mail us your
instructions or contact your Financial Intermediary. We may modify or cancel the
ability to purchase or redeem shares online or by phone without
notice.
Additional
Information Regarding Purchases
Federal law
requires all financial institutions to obtain, verify and record information
that identifies each person who opens an account. When you open an account, we
will ask for your name, residential or business street address, date of birth
(for an individual), and other information that will allow us to identify you,
including your social security number, tax identification number or other
identifying number. The J.P. Morgan Funds cannot waive these requirements. A
Fund is required by law to reject your Account Application if the required
identifying information is not provided.
We will
attempt to collect any missing information required on the Account Application
by contacting either you or your Financial Intermediary. If we cannot obtain
this information within the established time frame, your Account Application
will be rejected. Amounts received prior to receipt of the required information
will be held uninvested and will be returned to you without interest if your
Account Application is rejected. If the required information is obtained, your
investment will be accepted and you will pay the NAV per share next calculated
after all of the required information is received, plus any applicable sales
charge.
Once we have
received all of the required information, federal law requires us to verify your
identity. After an account is opened, we may restrict your ability to purchase
additional shares until your identity is verified. If we are unable to verify
your identity within a reasonable time, the Funds and/or the Distributor reserve
the right to close your account at the current day’s NAV per share. If your
account is closed for this reason, your shares will be redeemed at the NAV per
share next calculated after the account is closed, less any applicable CDSC or
fees. In addition, you will not be entitled to recoup any sales charges paid to
a Fund in connection with your purchase of Fund shares.
November
1, 2024 | 105
Investing
with J.P. Morgan Funds
(continued)
Purchases by
wire may be canceled if J.P. Morgan Funds Services does not receive payment by
4:00 p.m. ET on the settlement date. You will be responsible for any expenses
and/or losses to the Funds.
Exchanging
Fund Shares
An exchange
is selling shares of one J.P. Morgan Fund and taking the proceeds to
simultaneously purchase shares of another J.P. Morgan Fund. Before making an
exchange request, you should read the prospectus of the J.P. Morgan Fund whose
shares you would like to purchase by exchange. You can obtain a prospectus for
any J.P. Morgan Fund by contacting your Financial Intermediary, by visiting
www.jpmorganfunds.com, or by calling 1-800-480-4111.
|
EXCHANGE
PRIVILEGES |
|
Class
A Shares of a Fund may be exchanged for: |
|
●Class
A Shares of another J.P. Morgan Fund, |
|
●Morgan
Shares of a J.P. Morgan money market fund (except for JPMorgan Prime Money
Market Fund), or |
|
●Another
share class of the same Fund if you are eligible to purchase that
class. |
|
Class
C Shares of a Fund may be exchanged for: |
|
●Class
C Shares of another J.P. Morgan Fund (except for JPMorgan Prime Money
Market Fund). Your new Class C Shares will be
subject
to the CDSC of the Fund from which you exchanged, and the current holding
period for your exchanged Class C
Shares
is carried over to your new shares. |
|
●Class
I, Class L or Class R6 Shares, if available, of the same Fund, provided
you meet the eligibility requirements for the class
you
are exchanging into. In addition, the Class C Shares that you wish to
exchange must not currently be subject to any
CDSC. |
|
●Reserve
Shares of a J.P. Morgan money market fund (except for the JPMorgan Prime
Money Market Fund). Reserve Shares
are
not subject to an initial sales charge or CDSC. If you exchange Class C
Shares that are subject to a CDSC to Reserve
Shares,
you will not pay a CDSC at the time of the exchange. However, your new
Reserve Class Shares will be subject to the
CDSC
of the Fund from which you exchanged, and the current holding period for
your exchanged Class C Shares will be
carried
over to your new Reserve Shares. Reserve Shares investment minimums may be
waived for Class C shareholders that
convert
or exchange their Class C Shares into Reserve Shares of a J.P. Morgan
money market fund (except for the JPMorgan
Prime
Money Market Fund). |
|
Class
I Shares of a Fund may be exchanged for: |
|
●Class
I Shares of another J.P. Morgan Fund, |
|
●Morgan
Shares of a J.P. Morgan money market fund (except for JPMorgan Prime Money
Market Fund), or |
|
●Another
share class of the same Fund if you are eligible to purchase that
class. |
|
Class
L Shares of a Fund may be exchanged for: |
|
●Class
L Shares of another J.P. Morgan Fund, or |
|
●Another
share class of the same Fund if you are eligible to purchase that
class. |
The following
rules and procedures apply to exchanges:
●
All exchanges
are subject to meeting any investment minimum or eligibility requirements of the
new Fund and class.
●
The J.P.
Morgan Funds will provide 60 days’ written notice of any termination of or
material change to your exchange privilege.
●
All exchanges
are based upon the net asset value that is next calculated after a Fund receives
your order, provided the exchange out of one Fund must occur before the exchange
into the other Fund.
●
In order for
an exchange to take place on the date that the order is submitted, the order
must be received prior to the close of both the Fund that you wish to exchange
into and the Fund that you wish to exchange out of, otherwise, the exchange will
occur on the following business day on which both Funds are open.
●
A shareholder
that exchanges into shares of a Fund that accrues dividends daily, including a
money market fund, will not accrue a dividend on the day of the exchange. A
shareholder that exchanges out of shares of a Fund that accrues a daily dividend
will accrue a dividend on the day of the exchange.
●
The exchange
privilege is not intended as a way for you to speculate on short-term movements
in the market. Therefore, to prevent disruptions in the management of J.P.
Morgan Funds, certain J.P. Morgan Funds limit excessive exchange activity as
described in the “Frequent Trading Policy” section. Your exchange privilege will
be limited or revoked if the exchange activity is considered excessive. In
addition, any J.P. Morgan Fund may reject any exchange request for any reason,
including if it is not in the best interests of the Fund and/or its shareholders
to accept the exchange.
106 | J.P.
Morgan U.S. Equity Funds
●
For Class A
and Class C Shares only, you can set up a systematic exchange program to
automatically exchange shares on a regular basis. However, you cannot have
simultaneous systematic investment plans for the same Fund. You may call
1-800-480-4111 for complete instructions.
Generally,
you will not pay a sales charge on an exchange except as specified
below.
If you
exchange Class A or Class C Shares of a Fund that are subject to a CDSC for
Class A (Morgan Shares of a J.P. Morgan money market fund) or Class C Shares,
respectively, of another Fund, you will not pay a CDSC at the time of the
exchange, however:
1.
Your new
Class A (Morgan Shares of a J.P. Morgan money market fund) or Class C Shares
will be subject to the CDSC of the Fund from which you exchanged,
and
2.
The current
holding period for your exchanged Class A (Morgan Shares of a J.P. Morgan money
market fund) or Class C Shares, is carried over to your new shares.
Class C Shares of a Fund may
be exchanged for:
●
Class C Shares of another
J.P. Morgan Fund (except for JPMorgan Prime Money Market Fund). Your new Class C
Shares will be subject to the CDSC of the Fund from which you exchanged, and the
current holding period for your exchanged Class C Shares is carried over to your
new shares.
●
Class I, Class L or Class R6
Shares, if available, of the same Fund, provided you meet the eligibility
requirements for the class you are exchanging into. In addition, the Class C
Shares that you wish to exchange must not currently be subject to any
CDSC.
●
Reserve Shares of a J.P.
Morgan money market fund (except for the JPMorgan Prime Money Market Fund).
Reserve Shares are not subject to an initial sales charge or CDSC. If you
exchange Class C Shares that are subject to a CDSC to Reserve Shares, you will
not pay a CDSC at the time of the exchange. However, your new Reserve Class
Shares will be subject to the CDSC of the Fund from which you exchanged, and the
current holding period for your exchanged Class C Shares will be carried over to
your new Reserve Shares. Reserve Shares investment minimums may be waived for
Class C shareholders that convert or exchange their Class C Shares into Reserve
Shares of a J.P. Morgan money market fund (except for the JPMorgan Prime Money
Market Fund).
Tax
Consequences on Exchanges
Generally, an
exchange between J.P. Morgan Funds is considered a sale and generally results in
a capital gain or loss for federal income tax purposes. An exchange between
classes of shares of the same Fund is generally not taxable for federal income
tax purposes. You should talk to your tax advisor before making an
exchange.
Redeeming
Fund Shares
If you sell
shares through your Financial Intermediary, contact your investment
representative for its requirements and procedures. If a Financial Intermediary
holds your shares, it is the responsibility of the Financial Intermediary to
send your redemption order to the J.P. Morgan Funds. Your Financial Intermediary
may have an earlier cut-off time for redemption orders.
If you sell
shares directly with a Fund, see the information below.
Your
redemption proceeds may be mailed to you at your address of record1, wired, or
sent by ACH to a pre-existing bank account on file.
November
1, 2024 | 107
Investing
with J.P. Morgan Funds
(continued)
|
HOW
TO REDEEM | |
|
By
Phone or Online
Note:
Certain account
types
are not available for
online
account access. |
Call
us at 1-800-480-4111
Shareholder
Services representatives are available Monday through Friday from 8:00 am
to 6:00 pm ET.
www.jpmorganfunds.com |
|
By
Mail |
Regular
mailing address:
J.P.
Morgan Funds Services
P.O.
Box 219143
Kansas
City, MO 64121-9143
Overnight
mailing address:
J.P.
Morgan Funds Services
430
W 7th
Street, Suite 219143
Kansas
City, MO 64105-1407 |
|
Systematic
Redemption
Plan2,
3
Note:
The
Funds currently
do
not charge for this
service,
but may impose a
charge
in the future. |
You
may include instructions to set up a Systematic Redemption Plan on your
application. Payment
instructions
must be included.
You
may call, or mail written instructions to start, edit or delete a
Systematic Redemption Plan.
You
may send a written redemption request to your Financial Intermediary, if
applicable, or to the Fund at
the
following address:
J.P.
Morgan Funds Services
P.O.
Box 219143
Kansas
City, MO 64121-9143
You
may redeem over the phone. Please see “Can I redeem by phone?” for more
information.
If
you own Class A or Class C Shares, the applicable CDSC will be deducted
from those payments unless
such
payments are made:4
●Monthly
and constitute no more than 1/12
of 10% of your then-current balance in the Fund each
month;
or
●Quarterly
and constitute no more than ¼ of 10% of your then-current balance in the
Fund each
quarter.
It
may not be in your best interest to buy additional Class A Shares while
participating in a Systematic
Redemption
Plan. This is because Class A Shares have an upfront sales
charge. |
1
You cannot
request a redemption by check to be sent to an address updated within 15
days.
2
If the amount
of the systematic payment exceeds the income earned by your account since the
previous payment under the Systematic Redemption Plan, payments will be made by
redeeming some of your shares. This will reduce the amount of your investment,
up to possibly closing your account.
3
The Funds
currently do not charge for these services, but may impose a charge in the
future. However, your bank may impose a charge for crediting your bank
account.
4
Your current
balance in a Fund for purposes of these calculations will be determined by
multiplying the number of shares held by the last calculated NAV per share of
the applicable class.
You may
redeem some or all of your shares on any day that the Funds are open for
business. You will not be permitted to enter a redemption order for shares
purchased directly through J.P. Morgan Funds Services by check or through an ACH
transaction for five business days following the acceptance of a purchase order
unless you provide satisfactory proof that your purchase check or ACH
transaction has cleared (sometimes referred to as uncollected
shares).
If a Fund or
Financial Intermediary receives your redemption order before the close of the
NYSE (normally 4 p.m. ET or before 4:00 p.m. ET, if the NYSE closes before 4:00
p.m. ET), you will receive the NAV per share calculated after your redemption
order is received in good order (meaning that it includes the information
required by, and complies with security requirements implemented by, the Fund’s
transfer agent or the Fund), minus the amount of any applicable CDSC or fees.
Your Financial Intermediary may have an earlier cut-off time for redemption
orders and may charge a fee to process redemption of shares. A shareholder that
redeems out of shares of a Fund that accrues a daily dividend will accrue a
dividend on the day of the redemption.
108 | J.P.
Morgan U.S. Equity Funds
All
redemption requests must be supported by valid identity authentication, the
appropriate documentation (if applicable) and any necessary information in good
order. Additional information may be required depending on the
situation.
For
accounts held directly with the Funds, the length
of time that the Funds typically expect to pay redemption proceeds depends on
whether payment is made by ACH, wire or check. The Funds typically expect to
make payments of redemption proceeds by wire or ACH on the next business day
following receipt of the redemption order by the Funds. For payment by check,
the Funds typically expect to mail the check on the next business day following
receipt of the redemption order by the Funds.
For
accounts held through Financial Intermediaries, the length
of time that the Funds typically expect to pay redemption proceeds depends on
the method of payment and the agreement between the Financial Intermediary and
the Funds. For redemption proceeds that are paid directly to you by the Fund,
the Fund typically expects to make payments by wire or ACH or by mailing a check
on the next business day following the Fund’s receipt of a redemption order from
the Financial Intermediary. For payments that are made to your Financial
Intermediary for transmittal to you, the Funds expect to pay redemption proceeds
to the Financial Intermediary within 1 to 3 business days following the Fund’s
receipt of the redemption order from the Financial Intermediary.
Payment of
redemption proceeds may take longer than the time a Fund typically expects and
may take up to seven days as permitted by the Investment Company Act of
1940.
Transactions
by phone, fax or internet
You may access your account
and conduct certain transactions using phone, fax or the J.P. Morgan Funds
website. Phone conversations are recorded. The J.P. Morgan Funds and their
agents use reasonable procedures to verify the identity of the shareholder. If
these procedures are followed, the J.P. Morgan Funds and their agents are not
liable for any losses, liability, cost or expenses (including attorney fees)
that may occur from acting on unauthorized or fraudulent instructions.
Therefore, please take precautions to protect your account information and
immediately review account statements or other information provided to you. In
addition, a confirmation is sent promptly after a transaction. Please review it
carefully and contact J.P. Morgan Funds Services or your Financial Intermediary
immediately about any transaction you believe to be unauthorized. If you
purchased shares directly with the J.P. Morgan Funds, you may revoke your right
to make redemptions over the phone,
fax or internet
by mailing written instructions to us. If you purchased shares through your
Financial Intermediary, contact your investment representative regarding your
ability to revoke or modify your redemption rights.
You may not
always reach J.P. Morgan Funds Services by phone or online. This may be true at
times of unusual market changes and shareholder activity. You can mail us your
instructions or contact your Financial Intermediary. We may modify or cancel the
ability to purchase or redeem shares online or by phone without
notice.
Additional
Information Regarding Redemptions
Medallion
signature guarantees may be required if:
●
You want to
redeem shares with a value of $50,000 or more and you want to receive your
proceeds in the form of a check; or
●
You want your
payment sent to an address, bank account or payee other than the one currently
designated on your Fund account.
The J.P.
Morgan Funds may refuse to honor incomplete redemption orders.
The J.P.
Morgan Funds may suspend your ability to redeem when:
1.
Trading on
the NYSE is restricted;
2.
The NYSE is
closed (other than weekend and holiday closings);
3.
Federal
securities laws permit;
4.
The SEC has
permitted a suspension; or
5.
An emergency
exists, as determined by the SEC.
You generally
will recognize a gain or loss on a redemption for federal income tax purposes.
You should talk to your tax advisor before making a redemption.
Generally,
all redemptions will be for cash. The J.P. Morgan Funds typically expect to
satisfy redemption requests by selling portfolio assets or by using holdings of
cash or cash equivalents. On a less regular basis, the Funds may also satisfy
redemption requests by borrowing from another Fund, by drawing on a line of
credit from a bank, or using other short-term borrowings from its custodian.
These methods may be used during both normal and stressed market conditions. In
addition to paying redemption proceeds in cash,
November
1, 2024 | 109
Investing
with J.P. Morgan Funds
(continued)
if you redeem
shares worth $250,000 or more, the J.P. Morgan Funds reserve the right to pay
part or all of your redemption proceeds in readily marketable securities instead
of cash. If payment is made in securities, the Fund will value the securities
selected in the same manner in which it computes its NAV. This process minimizes
the effect of large redemptions on the Fund and its remaining shareholders. If
you receive a redemption in-kind, securities received by you may be subject to
market risk and you could incur taxable gains and brokerage or other charges in
converting the securities to cash. While the J.P. Morgan Funds do not routinely
use redemptions in-kind, the Funds reserve the right to use redemptions in-kind
to manage the impact of large redemptions on the Funds. Redemption in-kind
proceeds will typically be made by delivering a pro-rata amount of a Fund’s
holdings that are readily marketable securities to the redeeming shareholder
within seven days after the Fund’s receipt of the redemption order.
The Funds and
their service providers may temporarily hold redemption proceeds from accounts
maintained directly with the Funds if there is a reasonable belief that
financial exploitation of a Specified Adult has occurred, is occurring, has been
attempted, or will be attempted. For purposes of this paragraph, the term
“Specified Adult” refers to an individual who is (A) a natural person age 65 and
older; or (B) a natural person age 18 and older who the member reasonably
believes has a mental or physical impairment that renders the individual unable
to protect his or her own interests.
Minimum
Account Balance
Due to the
relatively high cost associated with maintaining small accounts J.P. Morgan
Funds has established minimum balance requirements for each Fund held in your
accounts. Minimum investment amounts per Fund are described earlier within the
Investing with J.P. Morgan Funds section of this prospectus. If a shareholder
does not maintain the required minimum balance in each Fund, J.P. Morgan Funds
may either 1) redeem all remaining shares in that Fund or 2) charge a $10 below
minimum balance fee per Fund. To collect the fee, the Fund will redeem $10 worth
of shares from your account. The Funds and/or the Distributor reserve the right
to determine whether we redeem all remaining shares and close your account or
charge the annual below minimum account fee. You will not be charged a CDSC, if
applicable, for these actions. Shareholders will receive written notice and be
given 60 days to bring Fund balances above minimum requirements before action is
taken on your account.
If your
account is below the minimum balance, you are participating in a systematic
investment plan, and you are not actively selling shares, it will be excluded
from the minimum balance requirements as long as the systematic payments will
increase your Fund value above the required minimum balance within 18 months of
the date that the account was established. Once the required minimum account
balance is reached, you must maintain the minimum investment amount in that
Fund.
Investors in
Class A or Class C Shares, employees investing in Class I Shares, as well as
investors in the Premier and Morgan share classes of the J.P. Morgan Money
Market Funds cannot combine investments for purposes of meeting the
minimum.
Certain
Financial Intermediaries or other organizations making the J.P. Morgan Funds
available to their clients or customers impose minimum account balances that may
be different than the requirements for investors purchasing directly from the
Funds. If a shareholder purchases shares through such an intermediary and does
not maintain the required minimum balance imposed by that intermediary, the
intermediary may redeem the investor’s shares or impose a fee consistent with
the terms of the investment arrangement with the investor. Please contact your
intermediary for more information.
Closings,
Reorganizations and Liquidations
To the extent
authorized by law, each Fund reserves the right to discontinue offering shares
at any time, to merge or reorganize itself or a share class, or to cease
operations and liquidate at any time.
Funds
Subject to a Limited Offering
Certain Funds
and Class L Shares are offered on a limited basis as described below. Except as
otherwise described below, shareholders permitted to continue to purchase
include shareholders of record and if the shareholder of record is an omnibus
account, beneficial owners in that account as of the effective date of the
limited offering.
JPMorgan
Small Cap Growth Fund
Effective as
of the close of business on February 5, 2021 (the “Closing Date”), the JPMorgan
Small Cap Growth Fund (the “Fund”) became offered on a limited basis and
investors are not eligible to purchase shares of the Fund, except as described
below. In addition, both before and after the Closing Date, the Fund may from
time to time, in its sole discretion based on the Fund’s net asset levels and
other factors, limit new purchases into the Fund or otherwise modify the closure
policy at any time on a case-by-case basis.
The following
groups will be permitted to continue to purchase Fund shares. Except as
otherwise described below, shareholders of record are permitted to continue to
purchase shares; if the shareholder of record is an omnibus account, beneficial
owners in that account as of the applicable closing date are permitted to
continue to purchase:
110 | J.P.
Morgan U.S. Equity Funds
●
Shareholders
of record of the Fund as of the Closing Date are able to continue to purchase
additional shares in their existing Fund accounts and may continue to reinvest
dividends or capital gains distributions from shares owned in the
Fund;
●
Shareholders
of record of the Fund as of the Closing Date are able to add to their existing
Fund accounts through exchanges from other J.P. Morgan Funds;
●
Group
Retirement Plans (as defined in the glossary) (and their successor, related and
affiliated plans), which have the Fund available to participants on or before
the Closing Date may continue to open accounts for new participants and can
purchase additional shares in existing participant accounts. A new Group
Retirement Plan may establish a new account with the Fund only if the Plan has
been accepted for investment by the Fund and its distributor by May 31, 2021,
and the plan’s account with the Fund must be either funded by the plan or
available to participant directed investments by July 30, 2021;
●
Institutional
investors (including successor, related, or affiliated accounts) may establish a
new account with the Fund only if the account has been accepted for investment
by the Fund and its distributor by the Closing Date, and the account with the
Fund must be funded by July 30, 2021 (Institutional investors include, but are
not limited to, corporations, qualified non-profit organizations, charitable
trusts, foundations and endowments, governmental entities, municipalities, and
hospitals investing for their own account. These accounts may not be held for
the benefit of multiple underlying, unrelated investors.);
●
Fully
discretionary fee-based advisory programs, where investment discretion (fund and
investment allocations)solely reside with the Financial Intermediary’s home
office and where the Financial Intermediary’s home office has full authority to
make investment changes without approval from the shareholder, may continue to
utilize the Fund for new and existing program accounts. These programs must be
accepted for continued investment by the Fund and its distributor by the Closing
Date. Additionally, after the Closing Date, new fully discretionary fee-based
advisory programs may utilize the Fund for program accounts only with the
approval by the Fund and its distributor;
●
Registered
Investment Advisory firms who have included the Fund in their discretionary
models by the closing date and utilize an approved clearing platform may
continue to make Fund shares available to new and existing accounts. These
particular firms must be accepted for continued investment by the Fund and its
distributor on or before the Closing Date;
●
Other
fee-based advisory programs (including Rep as Advisor and Portfolio Manager
programs) may continue to utilize the Fund for existing program accounts, but
will not be able to open new program accounts after the Closing Date;
and
●
Named
investment professionals listed in the Fund’s prospectus may utilize the Fund
for both new accounts and existing Fund accounts.
Limited
Offering of the Class L Shares
The Funds’
Class L Shares are publicly offered only on a limited basis. Investors are not
eligible to purchase Class L Shares of the Funds except as described below. In
addition, a Fund may from time to time, in its sole discretion based on a Fund’s
net asset levels and other factors, limit new purchases into a Fund or otherwise
modify the closure policy at any time on a case-by-case basis.
Except as
otherwise described below, shareholders of record are permitted to continue to
purchase Class L Shares; if the shareholder of record is an omnibus account,
beneficial owners in that account as of December 1, 2016 (“the Transition Date”)
are permitted to continue to purchase Class L Shares.
●
Existing
shareholders of Class L Shares of a Fund are able to continue to purchase
additional Class L Shares of that Fund in their existing Fund accounts either
through J.P. Morgan Funds Services or a Financial Intermediary and may continue
to reinvest dividends or capital gains distributions from shares owned in the
Fund;
●
Existing
shareholders of Class L Shares of a Fund are able to add to their existing Fund
accounts through exchanges from Class L Shares of other Funds;
●
Group
Retirement Plans (as defined in the Glossary) may continue to use the Class L
Shares of a Fund under certain circumstances. Effective April 3, 2017, new Group
Retirement Plans are not eligible to purchase Class L Shares. Group Retirement
Plans (and their successor, related and affiliated plans) which have Class L
Shares of a Fund available to participants on or before April 3, 2017, may
continue to open accounts for new participants in Class L Shares of a Fund and
purchase additional shares in existing participant accounts. In addition, new
Group Retirement Plans may purchase Class L Shares of a Fund until December 31,
2018, if it is determined that the particular Group Retirement Plan is having
operational difficulties in implementing the new eligibility restrictions and
receives the approval of the particular Fund and its Distributor;
●
Current and
future J.P. Morgan Funds that are permitted to invest in other J.P. Morgan Funds
may purchase Class L Shares of a Fund;
●
New York’s
529 Advisor-Guided College Savings Program may continue to utilize Class L
Shares for new and existing program accounts;
November
1, 2024 | 111
Investing
with J.P. Morgan Funds
(continued)
●
Registered
investment advisors using an approved custodial platform may utilize Class L
Shares of any Fund in fee-based advisory programs for both new and existing
program accounts;
●
Banks and
trust companies acting as a fiduciary and using an approved custodial platform
may continue to utilize Class L Shares of any Fund for new and existing customer
accounts. New banks or trust companies may utilize a Fund only with the approval
of that Fund and its Distributor; and
●
Other
fee-based advisory programs currently utilizing a Fund may continue to utilize
the Class L Shares of that particular Fund for new and existing program accounts
and any new affiliated program.
Additional
information that applies to all limited offerings:
If all shares
of a Fund (or a Class subject to a limited offering) in an existing
shareholder’s account are voluntarily redeemed or involuntarily redeemed (due to
instances when a shareholder does not meet aggregate account balance minimums or
when participants in Systematic Investment Plans do not meet minimum investment
requirements), then the shareholder’s account will be closed. Such former Fund
shareholders will not be able to buy additional Fund shares or reopen their
accounts in the Fund unless a former shareholder makes his or her repurchase
within 90 days of the redemption. Repurchases during this 90 day period will not
be subject to any applicable sales charges if such sales charges are normally
waived for repurchases within 90 days of the redemption as described in the
“Repurchase Rights” section above. However, these repurchase restrictions do not
apply to Group Retirement Plans that are eligible to continue to invest under
the limited offerings as described above. If shares are purchased through a
Financial Intermediary, contact your investment representative for their
requirements and procedures.
If a Fund
receives a purchase order directly from an investor who is not eligible to
purchase shares of the Fund, after the limited offering dates outlined above,
J.P. Morgan Funds Services will attempt to contact the investor to determine
whether he or she would like to purchase shares of another Fund or would prefer
that the investment be refunded. If J.P. Morgan Funds Services cannot contact
the investor within 30 days, the entire investment will be refunded.
The J.P. Morgan Funds reserve
the right to change these policies at any time.
Frequent
Trading Policy
J.P. Morgan
Funds do not authorize market timing and, except for the Funds identified below,
use reasonable methods to identify market timers and to prevent such activity.
However, there can be no assurance that these methods will prevent market timing
or other trading that may be deemed abusive. Market timing is an investment
strategy using frequent purchases, redemptions and/or exchanges in an attempt to
profit from short-term market movements. Market timing may result in dilution of
the value of Fund shares held by long-term shareholders, disrupt portfolio
management and increase Fund expenses for all shareholders. Although market
timing may affect any Fund, these risks may be higher for Funds that invest
significantly in non-U.S. securities or thinly traded securities (e.g., certain
small cap securities), such as international, global or emerging market funds or
small cap funds. For example, when a Fund invests in securities trading
principally in non-U.S. markets that close prior to the close of the NYSE,
market timers may seek to take advantage of the difference between the prices of
these securities at the close of their non-U.S. markets and the value of such
securities when the Fund calculates its net asset value.
J.P. Morgan
Funds or the Distributor will prohibit any purchase order (including exchanges)
with respect to one investor, a related group of investors or their agent(s)
where they detect a pattern of either purchases and sales of one of the J.P.
Morgan Funds, or exchanges between or among J.P. Morgan Funds, that indicates
market timing or trading that they determine is abusive.
Although J.P.
Morgan Funds use a variety of methods to detect and deter market timing, there
is no assurance that the Funds’ own operational systems and procedures will
identify and eliminate all market timing strategies. For example, certain
accounts, which are known as omnibus accounts, include multiple investors and
such accounts typically provide the Funds with a net purchase or redemption
order on any given day where purchasers of Fund shares and redeemers of Fund
shares are netted against one another and the identity of individual purchasers
and redeemers are not known by the Funds. While the Funds seek to monitor for
market timing activities in omnibus accounts, the netting effect limits the
Funds’ ability to locate and eliminate individual market timers. As a result,
the Funds are often dependent upon Financial Intermediaries who utilize their
own policies and procedures to identify market timers. These policies and
procedures may be different than those utilized by the Funds.
The Boards of
J.P. Morgan Funds have adopted various policies and procedures to identify
market timers, including reviewing “round trips” in and out of J.P. Morgan Funds
by investors. A “round trip” includes a purchase or exchange into a Fund
followed or preceded by a redemption or exchange out of the same Fund. If the
Distributor detects that you have completed two round trips within 60 days
112 | J.P.
Morgan U.S. Equity Funds
in the same
Fund, the Distributor will reject your purchase and exchange orders for a period
of at least 90 days. For subsequent violations, the Distributor may, in its sole
discretion, reject your purchase and exchange orders temporarily or permanently.
In identifying market timers, the Distributor may also consider activity of
accounts that it believes to be under common ownership or control.
J.P. Morgan
Funds have attempted to put safeguards in place to assure that Financial
Intermediaries have implemented procedures designed to deter market timing and
abusive trading. Despite these safeguards, there is no assurance that the Funds
will be able to effectively identify and eliminate market timing and abusive
trading in the Funds particularly with respect to omnibus accounts.
J.P. Morgan
Funds will seek to apply the Funds’ market timing policies and restrictions as
uniformly as practicable to accounts with the Funds, except with respect to the
following:
1.
Trades that
occur through omnibus accounts at Financial Intermediaries as described
above;
2.
Purchases,
redemptions and exchanges made on a systematic basis;
3.
Automatic
reinvestments of dividends and distributions;
4.
Purchases,
redemptions or exchanges that are part of a rebalancing program, such as a wrap,
advisory or bona fide asset allocation program, which includes investment models
developed and maintained by a financial intermediary;
5.
Redemptions
of shares to pay fund or account fees;
6.
Transactions
initiated by the trustee or adviser to a donor-advised charitable gift
fund;
7.
Transactions
in Section 529 college savings plans;
8.
Transactions
in Fund of Fund Products; and
9.
Transactions
within a Retirement account such as:
●
Shares
redeemed to return an excess contribution;
●
Transactions
initiated by sponsors of group employee benefit plans or other related
accounts;
●
Retirement
plan contributions, loans, distributions, and hardship withdrawals;
●
IRA
re-characterizations and conversions; and
●
IRA purchases
of shares by asset transfer or direct rollover.
In addition
to rejecting purchases in connection with suspected market timing activities,
the Distributor can reject a purchase (including purchases for the Funds listed
below) for any reason, including purchases that it does not think are in the
best interests of a Fund and/or its shareholders or if it determines the trading
to be abusive. Your Financial Intermediary may also have additional procedures
for identifying market timers and rejecting or otherwise restricting purchases
and/or exchanges.
Certain J.P. Morgan Funds are
intended for short-term investment horizons and do not monitor for market timers
or prohibit such short-term trading activity. Those Funds are the JPMorgan Short
Duration Bond Fund, JPMorgan Short Duration Core Plus Fund, JPMorgan
Short-Intermediate Municipal Bond Fund, JPMorgan Managed Income Fund, JPMorgan
Ultra-Short Municipal Fund and the J.P. Morgan Money Market Funds. Although
these Funds are managed in a manner that is consistent with their investment
objectives, frequent trading by shareholders may disrupt their management and
increase their expenses.
Valuation
Shares are
purchased at NAV per share, plus a sales charge. This is also known as the
offering price. Shares are also redeemed at NAV, minus any applicable CDSC. The
NAV of each class within a Fund varies, primarily because each class has
different class-specific expenses such as distribution and service
fees.
The NAV per
share of a class of a Fund is equal to the value of all the assets attributable
to that class, minus the liabilities attributable to that class, divided by the
number of outstanding shares of that class. The following is a summary of the
procedures generally used to value J.P. Morgan Funds’ investments.
Securities
for which market quotations are readily available are generally valued at their
current market value. Other securities and assets, including securities for
which market quotations are not readily available; market quotations are
determined not to be reliable; or, their value has been materially affected by
events occurring after the close of trading on the exchange or market on which
the security is principally traded but before a Fund’s NAV is calculated, may be
valued at fair value in accordance with policies and procedures adopted by the
J.P. Morgan Funds’ Board of Trustees. Fair value represents a good faith
determination of the value of a
November
1, 2024 | 113
Investing
with J.P. Morgan Funds
(continued)
security or
other asset based upon specifically applied procedures. Fair valuation may
require subjective determinations. There can be no assurance that the fair value
of an asset is the price at which the asset could have been sold during the
period in which the particular fair value was used in determining a Fund’s
NAV.
Equity
securities listed on a North American, Central American, South American or
Caribbean securities exchange are generally valued at the last sale price on the
exchange on which the security is principally traded. Other foreign equity
securities are fair valued using quotations from an independent pricing service,
as applicable. The value of securities listed on the NASDAQ Stock Market, Inc.
is generally the NASDAQ official closing price.
Fixed income
securities are valued using prices supplied by an approved independent third
party or affiliated pricing services or broker/dealers. Those prices are
determined using a variety of inputs and factors as more fully described in the
Statement of Additional Information.
Assets and
liabilities initially expressed in foreign currencies are converted into U.S.
dollars at the prevailing market rates from an approved independent pricing
service as of 4:00 p.m. ET.
Shares of
ETFs are generally valued at the last sale price on the exchange on which the
ETF is principally traded. Shares of open-end investment companies are valued at
their respective NAVs.
Options
traded on U.S. securities exchanges are valued at the composite mean price,
using the National Best Bid and Offer quotes.
Options
traded on foreign exchanges are valued at the settled price, or if no settled
price is available, at the last sale price available prior to the calculation of
a Fund’s NAV and will be fair valued by applying fair value factors provided by
independent pricing services, as applicable, for any options involving equity
reference obligations listed on exchanges other than North American, Central
American, South American or Caribbean securities exchanges.
Exchange
traded futures are valued at the last sale price available prior to the
calculation of a Fund’s NAV. Any futures involving equity reference obligations
listed on exchanges other than North American, Central American, South American
or Caribbean securities exchanges will be fair valued by applying fair value
factors provided by independent pricing services, as applicable.
Non-listed
over-the-counter options and futures are valued utilizing market quotations
provided by approved pricing services.
Swaps and
structured notes are priced generally by an approved independent third party or
affiliated pricing service or at an evaluated price provided by a counterparty
or broker/dealer.
Any
derivatives involving equity reference obligations listed on exchanges other
than North American, Central American, South American or Caribbean securities
exchanges will be fair valued by applying fair value factors provided by
independent pricing services, as applicable.
NAV is
calculated each business day as of the close of the NYSE, which is typically
4:00 p.m. ET. On occasion, the NYSE will close before 4:00 p.m. ET. When that
happens, NAV will be calculated as of the time the NYSE closes. The Funds will
not treat an
intraday unscheduled disruption or closure in NYSE trading as a closure of the
NYSE and will calculate NAV as of 4:00 p.m. ET, if the particular disruption or
closure directly affects only the NYSE. The price at which a purchase is
effected is based on the next calculation of NAV after the order is received in
proper form in accordance with this prospectus. To the extent a Fund invests in
securities that are primarily listed on foreign exchanges or other markets that
trade on weekends or other days when a Fund does not price its shares, the value
of a Fund’s shares may change on days when you will not be able to purchase or
redeem your shares.
Distributions
and Taxes
Each Fund has
elected to be treated and intends to qualify each taxable year as a regulated
investment company. A regulated investment company is not subject to tax at the
corporate level on income and gains from investments that are distributed to
shareholders. Each Fund’s failure to qualify as a regulated investment company
would result in corporate-level taxation and, consequently, a reduction in
income available for distribution to shareholders.
Each Fund can
earn income and realize capital gain. Each Fund deducts any expenses and then
pays out the earnings, if any, to shareholders as distributions.
The Growth Advantage Fund,
Mid Cap Equity Fund, Mid Cap Growth Fund, Mid Cap Value Fund, Small Cap Blend
Fund, Small Cap Equity Fund, Small Cap Growth Fund, SMID Cap Equity Fund, U.S.
Small Company Fund and Value Advantage Fund generally distribute net investment
income, if any, at least annually. The Small Cap Value Fund generally
distributes net investment income, if any, at least quarterly. The Funds will
distribute net realized capital gains, if any, at least annually. For each
taxable year, each Fund will distribute substantially all of its net investment
income and net realized capital gains.
You have the
following options for your distributions. You may:
●
Reinvest all
distributions in additional Fund shares;
114 | J.P.
Morgan U.S. Equity Funds
●
Take
distributions of net investment income in cash and reinvest distributions of net
capital gain in additional shares;
●
Take
distributions of net capital gain in cash and reinvest distributions of net
investment income; or
●
Take all
distributions in cash.
If you do not
select an option when you open your account, we will reinvest all distributions.
If your distributions are reinvested, they will be in the form of shares of the
same class without a sales charge. If you take your distributions in cash, you
can choose to have a check mailed to your address of record or you can have them
deposited into a pre-assigned bank account. The taxation of the dividends will
not be affected whether you have them deposited into a bank account or sent by
check.
Distributions
of net investment income generally are taxable as ordinary income. Dividends of
net investment income paid to a non-corporate U.S. shareholder that are properly
reported as qualified dividend income generally will be taxable to such
shareholder at preferential rates. The maximum individual federal income tax
rate applicable to “qualified dividend income” is either 15% or 20%, depending
on whether the individual’s income exceeds certain threshold amounts. The amount
of dividend income that may be so reported by a Fund generally will be limited
to the aggregate of the eligible dividends received by each Fund. In addition, a
Fund must meet certain holding period and other requirements with respect to the
shares on which the Fund received the eligible dividends, and the non-corporate
U.S. shareholder must meet certain holding period and other requirements with
respect to the Fund. The amount of a Fund’s distributions that would otherwise
qualify for this favorable tax treatment may be reduced as a result of the
Fund’s securities lending activities or high portfolio turnover rate. Dividends
of net investment income that are not reported as qualified dividend income and
dividends of net short-term capital gain will be taxable to a U.S. shareholder
as ordinary income.
Distributions
of net capital gain (that is, the excess of the net gains from the sale of
investments that a Fund owned for more than one year over the net losses from
investments that the Fund owned for one year or less) that are properly reported
by a Fund as capital gain dividends will be taxable as long-term capital gain,
regardless of how long you have held your shares in the Fund. The maximum
individual federal income tax rate applicable to long-term capital gains is
generally either 15% or 20%, depending on whether the individual’s income
exceeds certain threshold amounts. Distributions of net short-term capital gain
(that is, the excess of any net short-term capital gain over net long-term
capital loss), if any, will be taxable to U.S. shareholders as ordinary income.
Capital gain of a corporate shareholder is taxed at the same rate as ordinary
income.
An additional
3.8% Medicare tax is imposed on certain net investment income (including
ordinary dividends and capital gain distributions received from a Fund and net
gains from redemptions or other taxable dispositions of Fund shares) of U.S.
individuals, estates and trusts to the extent that such person’s “modified
adjusted gross income” (in the case of an individual) or “adjusted gross income”
(in the case of an estate or trust) exceeds certain threshold
amounts.
Except when your investment
is in an IRA, 401(k) plan or other tax-advantaged investment plan, or you are a
tax-exempt investor, if you buy shares of a Fund before a distribution, you will
be subject to tax on the entire amount of the taxable distribution you receive.
This is known as “buying a dividend”. Distributions are taxable to you even if
they are paid from income or gains earned by a Fund before your investment (and
thus were included in the price you paid for your Fund shares). To avoid buying
a dividend, please check a Fund’s Dividend and Capital Gain Schedule before you
invest.
A Fund’s
investments in certain debt securities and derivative instruments may cause the
Fund to accrue and distribute income not yet received. In order to generate
sufficient cash to make the requisite distributions, a Fund may be required to
liquidate other investments in its portfolio that it otherwise would have
continued to hold, including when it is not advantageous to do so. A Fund’s
investment in REIT securities also may result in the Fund’s receipt of cash in
excess of the REIT’s earnings; if the Fund distributes such amounts, such
distributions could constitute a return of capital to Fund shareholders for
federal income tax purposes.
A Fund’s
transactions in futures contracts, short sales, swaps and other derivatives will
be subject to special tax rules, the effect of which may be to accelerate income
to the Fund, defer losses to the Fund, cause adjustments in the holding periods
of the Fund’s securities, and convert short-term capital losses into long-term
capital losses. These rules could therefore affect the amount, timing and
character of distributions from the Fund, and, therefore, may increase the
amount of taxes payable by shareholders. A Fund’s use of these types of
transactions may result in the Fund realizing more short-term capital gain and
ordinary income subject to tax at ordinary income tax rates than it would if it
did not engage in such transactions.
The extent to
which a Fund can invest in master limited partnerships is limited by the Fund’s
intention to qualify as a regulated investment company under the Internal
Revenue Code.
Please see
the Statement of Additional Information for additional discussion of the tax
consequences of the above-described and other investments to each Fund and its
shareholders.
The dates on
which net investment income and capital gain dividends, if any, will be
distributed are available online at www.jpmorganfunds.com.
November
1, 2024 | 115
Investing
with J.P. Morgan Funds
(continued)
Early in each
calendar year, each Fund will send you a notice showing the amount of
distributions you received during the preceding calendar year and the tax status
of those distributions.
The Funds are
not intended for foreign shareholders. Any foreign shareholders would generally
be subject to U.S. tax-withholding on distributions by the Funds, as discussed
in the Statement of Additional Information.
Distributions
by a Fund to retirement plans and other entities that qualify for tax-exempt or
tax-deferred treatment under federal income tax laws will generally not be
taxable. Special tax rules apply to investments through such plans. The tax
considerations described in this section do not apply to such tax-exempt or
tax-deferred entities or accounts. You should consult your tax advisor to
determine the suitability of a Fund as an investment and the tax treatment of
distributions.
Any investor
for whom a Fund does not have a valid Taxpayer Identification Number may be
subject to backup withholding.
The above is
a general summary of tax implications of investing in the Funds. Because each
investor’s tax consequences are unique, please consult your tax advisor to see
how investing in a Fund and, for individuals and S corporations, selection of a
particular cost method of accounting will affect your own tax
situation.
IMPORTANT
TAX REPORTING CONSIDERATIONS
Your
Financial Intermediary or the Fund (if you hold your shares in the Fund direct
account) will report gains and losses realized on redemptions of shares for
shareholders who are individuals and S corporations purchased after January 1,
2012 to the Internal Revenue Service (IRS). This information will also be
reported to you on Form 1099-B and the IRS each year. In calculating the gain or
loss on redemptions of shares, the average cost method will be used to determine
the cost basis of Fund shares purchased after January 1, 2012 unless you
instruct the Fund in writing at J.P. Morgan Funds Services, P.O. Box 219143,
Kansas City, MO 64121-9143 that you want to use another available method for
cost basis reporting (for example, First In, First Out (FIFO), Last In, First
Out (LIFO), Specific Lot Identification (SLID) or High Cost, First Out (HIFO)).
If you designate SLID as your cost basis method, you will also need to designate
a secondary cost basis method (Secondary Method). If a Secondary Method is not
provided, the Fund will designate FIFO as the Secondary Method and will use the
Secondary Method with respect to systematic redemptions.
Not
all cost basis methods are available. Please contact the Fund at J.P. Morgan
Funds Services, P.O. Box 219143, Kansas City, MO 64121-9143 for more information
on the available methods for cost basis reporting. To determine which available
cost basis method is best for you, you should consult with your tax advisor.
Please note that you will be responsible for calculating and reporting gains and
losses on redemptions of shares purchased prior to January 1, 2012 to the IRS as
such information will not be reported by the Fund and may not be maintained by
your Financial Intermediary.
Your
Financial Intermediary or the Fund (if you hold your shares in the Fund direct
account) is also required to report gains and losses to the IRS in connection
with redemptions of shares by S corporations. If a shareholder is a corporation
and has not instructed the Fund that it is a C corporation in its account
application or by written instruction to J.P. Morgan Funds Services, P.O. Box
219143, Kansas City, MO 64121-9143, the Fund will treat the shareholder as an S
corporation and file a Form 1099-B.
Shareholder
Statements and Reports
The J.P.
Morgan Funds or your Financial Intermediary will send you transaction
confirmation statements and quarterly account statements. Please review these
statements carefully. The Funds will correct errors if notified within one year
of the date printed on the transaction confirmation or account statement, except
that, with respect to unfulfilled Letters of Intent, the Funds may process
corrections up to 15 months after the date printed on the transaction
confirmation or account statement. Your Financial Intermediary may have a
different cut-off time. J.P. Morgan Funds will charge a fee for requests for
statements that are older than two years. Please retain all of your statements,
as they could be needed for tax purposes.
To reduce
expenses and conserve natural resources, the J.P. Morgan Funds will deliver a
single copy of prospectuses and financial reports to individual investors who
share a residential address, provided they have the same last name or the J.P.
Morgan Funds reasonably believe they are members of the same family. If you
would like to receive separate mailings, please call 1-800-480-4111 and the Fund
will begin individual delivery within 30 days. If you would like to receive
these documents by e-mail, please visit www.jpmorganfunds.com and sign up for
electronic delivery.
If you hold
your Fund shares directly, you may access your account statements at
www.jpmorganfunds.com.
After each fiscal half year,
you will receive a financial report from the Funds. In addition, the Funds will
periodically send you proxy statements and other reports.
If you have
any questions or need additional information, please write to J.P. Morgan Funds
Services at P.O. Box 219143, Kansas City, MO 64121-9143, call 1-800-480-4111 or
visit www.jpmorganfunds.com.
116 | J.P.
Morgan U.S. Equity Funds
Portfolio
Holdings Disclosure
No sooner than 15 days after
the end of each month, each Fund will make available upon request the
uncertified, complete schedule of its portfolio holdings as of the last day of
that month. In addition to providing these schedules upon request, the Funds
will post these schedules on the J.P. Morgan Funds' website at
www.jpmorganfunds.com.
Not later
than 60 days after the end of each fiscal quarter, each Fund will make available
upon request a complete schedule of its portfolio holdings as of the last day of
that quarter.
Each Fund
will post these quarterly schedules on the J.P. Morgan Funds’ website at
www.jpmorganfunds.com and on the SEC’s website at www.sec.gov.
In addition,
from time to time, each Fund may post portfolio holdings on the J.P. Morgan
Funds’ website on a more frequent basis.
Each Fund may
disclose the Fund’s 10 largest portfolio holdings and the percentage that each
of these 10 holdings represent of the Fund’s portfolio as of the most recent
month’s end, online at www.jpmorganfunds.com, no sooner than 5 calendar days
after month’s end.
In addition,
the top five holdings that contributed to Fund performance and top five holdings
that detracted from Fund performance may be posted on the J.P. Morgan Funds’
website at www.jpmorganfunds.com no sooner than 5 calendar days after month
end.
Shareholders
may request portfolio holdings schedules at no charge by calling 1-800-480-4111.
A description of each Fund’s policies and procedures with respect to the
disclosure of a Fund’s portfolio holdings is available in the Statement of
Additional Information.
November
1, 2024 | 117
Glossary
of Common Investment Terminology
For the
purpose of the “INVESTING WITH J.P. MORGAN FUNDS” section, references to
“account” and “Fund” are not interchangeable. Fund refers to an individual
mutual fund position. An account may be invested in a single Fund or multiple
Funds.
Breakpoints —
Differences in sales charges that are assessed based on the amount of purchases.
The larger the investment, the lower the sales charge.
Capital
Gains Distribution — Payment to
mutual fund shareholders of gains realized on securities that a Fund has sold at
a profit, minus any realized losses.
Contingent
Deferred Sales Charge (CDSC) — A back-end
sales charge imposed when shares are redeemed from a Fund. This fee usually
declines over time.
Dividend
Distribution — Payment to
mutual fund shareholders of income from interest or dividends generated by a
Fund’s investments.
Financial
Intermediaries — Include
financial advisors, investment advisers, brokers, financial planners, banks,
insurance companies, retirement or 401(k) plan administrators and others,
including various affiliates of JPMorgan Chase, that have entered into
agreements with the Distributor and/or shareholder servicing agent. Shares
purchased this way will typically be held for you by the Financial
Intermediary.
Group
Retirement Plans — Refers to
employer-sponsored retirement, deferred compensation and employee benefit plans
(including health savings accounts) and trusts used to fund those plans. To
satisfy eligibility requirements, the plan must be a group plan (more than one
participant), the shares cannot be held in a commission-based brokerage account
and
●
Shares must
be held at a plan level or
●
Shares must
be held at the Fund level through an omnibus account of a retirement plan
recordkeeper.
Group
Retirement Plans include group employer-sponsored 401(k) plans, 457 plans,
employer-sponsored 403(b) plans, profit-sharing and money purchase pension
plans, defined benefit plans, retiree health benefit plans, group annuity
separate accounts offered to retirement plans and non-qualified deferred
compensation plans. Group Retirement Plans do not include traditional IRAs, Roth
IRAs, Coverdell Education Savings Accounts, SEPs, SARSEPs, SIMPLE IRAs, KEOGHs,
individual 401(k) or individual 403(b) plans.
Institutional
Investors — Include
fee-based “wrap” account sponsors (provided they have an agreement covering the
arrangement with the Distributor), corporations, qualified nonprofit
organizations, charitable trusts, foundations and endowments, state, county,
city or any instrumentality, department, authority or agency thereof, and banks,
trust companies or other depository institutions investing for their own account
or on behalf of their clients.
Letter
of Intent (LOI) — A Letter
of Intent is signed by an investor stating the investor’s intention to buy a
specified amount over a period of 13 months in order to receive a reduced
front-end sales charge. Each purchase the investor makes during the 13 month
period will receive the sales charge and breakpoint discount that applies to the
total amount specified in the Letter of Intent. If the amount is not met within
the 13 month period, the investor must pay the Distributor the difference
between the sales charges applicable to the purchases at the time they were made
and the reduced sales charges previously paid. A Letter of Intent shall be based
on the sales charge and breakpoint schedules in effect when the initial shares
were purchased.
Medallion
Signature Guarantee — A special
stamp used to verify the authenticity of certain documents. It is a guarantee by
a financial institution that the signature is genuine and the financial
institution accepts liability for any forgery. Medallion signature guarantees
protect shareholders by preventing unauthorized transfer of assets that could
result in monetary losses to the investor due to fraud. Medallion guarantee
stamps can be obtained at many bank branches or brokerage
firms.
Required
Minimum Distribution (RMD) — Refers to
the annual amounts that must be withdrawn from pre-tax retirement accounts (such
as Traditional, SEP, and SIMPLE IRAs) in or after the year the shareholder
reaches the qualified age based on applicable IRS
regulations.
Rights
of Accumulation (ROA) — When
utilizing “rights of accumulation,” the investor can combine the current market
value of any existing qualifying holdings and account types with the amount of
the current purchase to qualify for a breakpoint and reduced front-end sales
charge on the current purchase. Rights of Accumulation shall be based on the
sales charge and breakpoint schedules in effect when the initial shares were
purchased.
Uncollected
Shares — Shares
purchased directly through J.P. Morgan Funds Services by check or through an ACH
transaction are not available for redemption for up to five business days
following the acceptance of a purchase order unless you provide satisfactory
proof that your purchase check or ACH transaction has
cleared.
Wire
or ACH — Refers to
the method used for payment or redemptions. Movement of money by wire is
typically faster than money sent by ACH (Automated Clearing House). While J.P.
Morgan Funds does not charge for either method, your bank may charge a fee for
these services.
118 | J.P.
Morgan U.S. Equity Funds
Financial
Highlights
The financial highlights
tables are intended to help you understand each Fund’s financial performance for
each share class for the past five fiscal years or the period of a Fund’s
operations, as applicable. Certain information reflects financial results for a
single Fund share. The total returns in the tables represent the rate that an
investor would have earned (or lost) on an investment in a Fund (assuming
reinvestment of all dividends and distributions). This information for each
period presented has been audited by PricewaterhouseCoopers LLP, whose reports,
along with each Fund’s financial statements, are included in the respective
Fund’s Financial Statements and Other Information, which is available online at
www.jpmorganfunds.com
or upon request
by calling J.P. Morgan Funds Services at 1-800-480-4111.
To the extent
a Fund invests in other funds, the Total Annual Operating Expenses included in
the Fee Table will not correlate to the ratio of expenses to average net assets
in the financial highlights below.
|
|
|
Per
share operating performance | |||||
|
|
|
Investment
operations |
Distributions | ||||
|
|
Net asset
value,
beginning
of
period |
Net
investment
income
(loss)
(a) |
Net
realized
and
unrealized
gains
(losses) on
investments |
Total from
investment
operations |
Net
investment
income |
Net
realized
gain |
Total
distributions |
|
JPMorgan
Growth Advantage Fund |
|
|
|
|
|
|
|
|
Class
A |
|
|
|
|
|
|
|
|
Year
Ended June 30, 2024 |
$28.14 |
$(0.13) |
$9.47 |
$9.34 |
$— |
$(0.20) |
$(0.20) |
|
Year
Ended June 30, 2023 |
22.52 |
(0.08) |
5.79 |
5.71 |
— |
(0.09) |
(0.09) |
|
Year
Ended June 30, 2022 |
33.66 |
(0.16) |
(6.04) |
(6.20) |
— |
(4.94) |
(4.94) |
|
Year
Ended June 30, 2021 |
25.27 |
(0.16) |
11.67 |
11.51 |
— |
(3.12) |
(3.12) |
|
Year
Ended June 30, 2020 |
21.78 |
(0.08) |
5.74 |
5.66 |
— |
(2.17) |
(2.17) |
|
Class
C |
|
|
|
|
|
|
|
|
Year
Ended June 30, 2024 |
22.25 |
(0.22) |
7.44 |
7.22 |
— |
(0.20) |
(0.20) |
|
Year
Ended June 30, 2023 |
17.91 |
(0.16) |
4.59 |
4.43 |
— |
(0.09) |
(0.09) |
|
Year
Ended June 30, 2022 |
27.83 |
(0.26) |
(4.72) |
(4.98) |
— |
(4.94) |
(4.94) |
|
Year
Ended June 30, 2021 |
21.42 |
(0.26) |
9.79 |
9.53 |
— |
(3.12) |
(3.12) |
|
Year
Ended June 30, 2020 |
18.86 |
(0.16) |
4.89 |
4.73 |
— |
(2.17) |
(2.17) |
|
Class
I |
|
|
|
|
|
|
|
|
Year
Ended June 30, 2024 |
29.79 |
(0.05) |
10.04 |
9.99 |
— |
(0.20) |
(0.20) |
|
Year
Ended June 30, 2023 |
23.78 |
(0.02) |
6.12 |
6.10 |
— |
(0.09) |
(0.09) |
|
Year
Ended June 30, 2022 |
35.20 |
(0.09) |
(6.39) |
(6.48) |
— |
(4.94) |
(4.94) |
|
Year
Ended June 30, 2021 |
26.29 |
(0.09) |
12.18 |
12.09 |
(0.06) |
(3.12) |
(3.18) |
|
Year
Ended June 30, 2020 |
22.53 |
(0.02) |
5.95 |
5.93 |
— |
(2.17) |
(2.17) |
(a)
Calculated
based upon average shares outstanding.
(b)
Includes
adjustments in accordance with accounting principles generally accepted in the
United States of America and as such, the net asset values for financial
reporting purposes and the returns based upon those net asset values may differ
from the net asset values
and returns for shareholder transactions.
and returns for shareholder transactions.
(c)
Includes interest expense, if
applicable, which is less than 0.005% unless otherwise noted.
120 |
|
|
Ratios/Supplemental
data | |||||
|
|
|
|
Ratios
to average net assets | |||
|
Net asset
value,
end of
period |
Total
return
(excludes
sales charge)
(b) |
Net assets,
end of
period
(000’s) |
Net
expenses
(c) |
Net
investment
income
(loss) |
Expenses
without
waivers and
reimbursements |
Portfolio
turnover
rate |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$37.28 |
33.34% |
$4,103,661 |
1.04% |
(0.41)% |
1.13% |
28% |
|
28.14 |
25.46 |
2,957,562 |
1.04 |
(0.34) |
1.14 |
38 |
|
22.52 |
(22.53) |
2,362,435 |
1.08 |
(0.54) |
1.14 |
33 |
|
33.66 |
47.55 |
3,013,691 |
1.13 |
(0.54) |
1.14 |
43 |
|
25.27 |
27.87 |
2,032,870 |
1.14 |
(0.36) |
1.16 |
47 |
|
|
|
|
|
|
|
|
|
29.27 |
32.64 |
779,526 |
1.54 |
(0.91) |
1.64 |
28 |
|
22.25 |
24.86 |
808,227 |
1.54 |
(0.84) |
1.64 |
38 |
|
17.91 |
(22.90) |
798,037 |
1.58 |
(1.05) |
1.64 |
33 |
|
27.83 |
46.80 |
1,218,051 |
1.63 |
(1.04) |
1.63 |
43 |
|
21.42 |
27.20 |
942,512 |
1.64 |
(0.86) |
1.66 |
47 |
|
|
|
|
|
|
|
|
|
39.58 |
33.68 |
5,860,279 |
0.79 |
(0.16) |
0.88 |
28 |
|
29.79 |
25.75 |
4,496,251 |
0.79 |
(0.09) |
0.89 |
38 |
|
23.78 |
(22.33) |
3,376,110 |
0.83 |
(0.29) |
0.89 |
33 |
|
35.20 |
47.95 |
4,622,602 |
0.88 |
(0.29) |
0.88 |
43 |
|
26.29 |
28.15 |
2,827,894 |
0.89 |
(0.11) |
0.90 |
47 |
| 121
Financial
Highlights
(continued)
|
|
|
Per
share operating performance | |||||
|
|
|
Investment
operations |
Distributions | ||||
|
|
Net asset
value,
beginning
of
period |
Net
investment
income
(loss)
(a) |
Net
realized
and
unrealized
gains
(losses) on
investments |
Total from
investment
operations |
Net
investment
income |
Net
realized
gain |
Total
distributions |
|
JPMorgan
Mid Cap Equity Fund |
|
|
|
|
|
|
|
|
Class
A |
|
|
|
|
|
|
|
|
Year
Ended June 30, 2024 |
$53.29 |
$0.19 |
$5.92 |
$6.11 |
$(0.18) |
$— |
$(0.18) |
|
Year
Ended June 30, 2023 |
48.06 |
0.16 |
6.37 |
6.53 |
(0.12) |
(1.18) |
(1.30) |
|
Year
Ended June 30, 2022 |
62.14 |
0.05 |
(9.53) |
(9.48) |
— |
(4.60) |
(4.60) |
|
Year
Ended June 30, 2021 |
47.20 |
(0.03) |
21.27 |
21.24 |
(0.08) |
(6.22) |
(6.30) |
|
Year
Ended June 30, 2020 |
50.52 |
0.13 |
0.78 |
0.91 |
(0.30) |
(3.93) |
(4.23) |
|
Class
C |
|
|
|
|
|
|
|
|
Year
Ended June 30, 2024 |
49.56 |
(0.08) |
5.48 |
5.40 |
— |
— |
— |
|
Year
Ended June 30, 2023 |
44.88 |
(0.09) |
5.95 |
5.86 |
— |
(1.18) |
(1.18) |
|
Year
Ended June 30, 2022 |
58.61 |
(0.25) |
(8.88) |
(9.13) |
— |
(4.60) |
(4.60) |
|
Year
Ended June 30, 2021 |
44.95 |
(0.29) |
20.17 |
19.88 |
— |
(6.22) |
(6.22) |
|
Year
Ended June 30, 2020 |
48.32 |
(0.10) |
0.71 |
0.61 |
(0.05) |
(3.93) |
(3.98) |
|
Class
I |
|
|
|
|
|
|
|
|
Year
Ended June 30, 2024 |
54.58 |
0.34 |
6.05 |
6.39 |
(0.29) |
— |
(0.29) |
|
Year
Ended June 30, 2023 |
49.19 |
0.30 |
6.51 |
6.81 |
(0.24) |
(1.18) |
(1.42) |
|
Year
Ended June 30, 2022 |
63.43 |
0.20 |
(9.75) |
(9.55) |
(0.09) |
(4.60) |
(4.69) |
|
Year
Ended June 30, 2021 |
48.07 |
0.13 |
21.66 |
21.79 |
(0.21) |
(6.22) |
(6.43) |
|
Year
Ended June 30, 2020 |
51.35 |
0.25 |
0.80 |
1.05 |
(0.40) |
(3.93) |
(4.33) |
(a)
Calculated
based upon average shares outstanding.
(b)
Includes
adjustments in accordance with accounting principles generally accepted in the
United States of America and as such, the net asset values for financial
reporting purposes and the returns based upon those net asset values may differ
from the net asset values and returns for shareholder transactions.
(c)
Includes interest expense, if
applicable, which is less than 0.005% unless otherwise noted.
122 |
|
|
Ratios/Supplemental
data | |||||
|
|
|
|
Ratios
to average net assets | |||
|
Net asset
value,
end of
period |
Total
return
(excludes
sales charge)
(b) |
Net assets,
end of
period
(000’s) |
Net
expenses
(c) |
Net
investment
income
(loss) |
Expenses
without
waivers and
reimbursements |
Portfolio
turnover
rate |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$59.22 |
11.48% |
$765,572 |
1.14% |
0.35% |
1.25% |
38% |
|
53.29 |
13.70 |
642,773 |
1.14 |
0.32 |
1.26 |
40 |
|
48.06 |
(16.58) |
526,401 |
1.15 |
0.08 |
1.26 |
33 |
|
62.14 |
47.31 |
595,304 |
1.14 |
(0.05) |
1.26 |
54 |
|
47.20 |
2.20 |
405,857 |
1.14 |
0.28 |
1.26 |
49 |
|
|
|
|
|
|
|
|
|
54.96 |
10.90 |
15,065 |
1.64 |
(0.16) |
1.77 |
38 |
|
49.56 |
13.16 |
14,923 |
1.64 |
(0.18) |
1.78 |
40 |
|
44.88 |
(17.00) |
13,761 |
1.65 |
(0.44) |
1.77 |
33 |
|
58.61 |
46.59 |
21,836 |
1.63 |
(0.56) |
1.75 |
54 |
|
44.95 |
1.69 |
20,753 |
1.64 |
(0.23) |
1.76 |
49 |
|
|
|
|
|
|
|
|
|
60.68 |
11.74 |
1,079,673 |
0.89 |
0.60 |
1.00 |
38 |
|
54.58 |
13.99 |
995,077 |
0.89 |
0.58 |
1.01 |
40 |
|
49.19 |
(16.37) |
802,716 |
0.90 |
0.33 |
1.02 |
33 |
|
63.43 |
47.67 |
886,782 |
0.89 |
0.23 |
1.00 |
54 |
|
48.07 |
2.46 |
341,317 |
0.89 |
0.53 |
1.01 |
49 |
| 123
Financial
Highlights
(continued)
|
|
|
Per
share operating performance | |||||
|
|
|
Investment
operations |
Distributions | ||||
|
|
Net asset
value,
beginning
of
period |
Net
investment
income
(loss)
(a) |
Net
realized
and
unrealized
gains
(losses) on
investments |
Total from
investment
operations |
Net
investment
income |
Net
realized
gain |
Total
distributions |
|
JPMorgan
Mid Cap Growth Fund |
|
|
|
|
|
|
|
|
Class
A |
|
|
|
|
|
|
|
|
Year
Ended June 30, 2024 |
$35.03 |
$(0.22) |
$4.91 |
$4.69 |
$— |
$— |
$— |
|
Year
Ended June 30, 2023 |
29.58 |
(0.18) |
5.93 |
5.75 |
— |
(0.30) |
(0.30) |
|
Year
Ended June 30, 2022 |
46.20 |
(0.31) |
(11.67) |
(11.98) |
— |
(4.64) |
(4.64) |
|
Year
Ended June 30, 2021 |
36.43 |
(0.36) |
15.58 |
15.22 |
— |
(5.45) |
(5.45) |
|
Year
Ended June 30, 2020 |
32.94 |
(0.20) |
6.50 |
6.30 |
— |
(2.81) |
(2.81) |
|
Class
C |
|
|
|
|
|
|
|
|
Year
Ended June 30, 2024 |
23.29 |
(0.26) |
3.24 |
2.98 |
— |
— |
— |
|
Year
Ended June 30, 2023 |
19.86 |
(0.23) |
3.96 |
3.73 |
— |
(0.30) |
(0.30) |
|
Year
Ended June 30, 2022 |
32.69 |
(0.36) |
(7.83) |
(8.19) |
— |
(4.64) |
(4.64) |
|
Year
Ended June 30, 2021 |
27.15 |
(0.42) |
11.41 |
10.99 |
— |
(5.45) |
(5.45) |
|
Year
Ended June 30, 2020 |
25.34 |
(0.28) |
4.90 |
4.62 |
— |
(2.81) |
(2.81) |
|
Class
I |
|
|
|
|
|
|
|
|
Year
Ended June 30, 2024 |
43.56 |
(0.15) |
6.10 |
5.95 |
— |
— |
— |
|
Year
Ended June 30, 2023 |
36.62 |
(0.12) |
7.36 |
7.24 |
— |
(0.30) |
(0.30) |
|
Year
Ended June 30, 2022 |
55.95 |
(0.25) |
(14.44) |
(14.69) |
— |
(4.64) |
(4.64) |
|
Year
Ended June 30, 2021 |
43.11 |
(0.28) |
18.58 |
18.30 |
(0.01) |
(5.45) |
(5.46) |
|
Year
Ended June 30, 2020 |
38.37 |
(0.12) |
7.67 |
7.55 |
— |
(2.81) |
(2.81) |
(a)
Calculated
based upon average shares outstanding.
(b)
Includes
adjustments in accordance with accounting principles generally accepted in the
United States of America and as such, the net asset values for financial
reporting purposes and the returns based upon those net asset values may differ
from the net asset values and returns for shareholder transactions.
(c)
Includes interest expense, if
applicable, which is less than 0.005% unless otherwise noted.
124 |
|
|
Ratios/Supplemental
data | |||||
|
|
|
|
Ratios
to average net assets | |||
|
Net asset
value,
end of
period |
Total return
(b) |
Net assets,
end of
period
(000’s) |
Net
expenses
(c) |
Net
investment
income
(loss) |
Expenses
without
waivers and
reimbursements |
Portfolio
turnover
rate |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
$39.72 |
13.39% |
$1,365,143 |
1.14% |
(0.59)% |
1.26% |
55% |
|
35.03 |
19.53 |
1,242,347 |
1.14 |
(0.56) |
1.26 |
45 |
|
29.58 |
(28.80) |
1,119,928 |
1.18 |
(0.78) |
1.26 |
45 |
|
46.20 |
43.59 |
1,642,278 |
1.24 |
(0.85) |
1.26 |
42 |
|
36.43 |
20.30 |
1,141,467 |
1.24 |
(0.62) |
1.27 |
63 |
|
|
|
|
|
|
|
|
|
26.27 |
12.80 |
51,347 |
1.64 |
(1.08) |
1.76 |
55 |
|
23.29 |
18.91 |
60,306 |
1.64 |
(1.06) |
1.75 |
45 |
|
19.86 |
(29.14) |
67,482 |
1.68 |
(1.28) |
1.75 |
45 |
|
32.69 |
42.84 |
109,845 |
1.74 |
(1.36) |
1.75 |
42 |
|
27.15 |
19.72 |
86,046 |
1.74 |
(1.12) |
1.75 |
63 |
|
|
|
|
|
|
|
|
|
49.51 |
13.66 |
2,378,644 |
0.89 |
(0.34) |
0.99 |
55 |
|
43.56 |
19.84 |
2,344,119 |
0.89 |
(0.30) |
1.00 |
45 |
|
36.62 |
(28.62) |
1,403,485 |
0.91 |
(0.50) |
1.00 |
45 |
|
55.95 |
44.02 |
2,003,878 |
0.93 |
(0.54) |
0.99 |
42 |
|
43.11 |
20.70 |
1,205,433 |
0.93 |
(0.31) |
1.00 |
63 |
| 125
Financial
Highlights
(continued)
|
|
|
Per
share operating performance | |||||
|
|
|
Investment
operations |
Distributions | ||||
|
|
Net asset
value,
beginning
of
period |
Net
investment
income
(loss)
(a) |
Net
realized
and
unrealized
gains
(losses) on
investments |
Total from
investment
operations |
Net
investment
income |
Net
realized
gain |
Total
distributions |
|
JPMorgan
Mid Cap Value Fund |
|
|
|
|
|
|
|
|
Class
A |
|
|
|
|
|
|
|
|
Year
Ended June 30, 2024 |
$34.36 |
$0.28 |
$3.29 |
$3.57 |
$(0.34) |
$(1.71) |
$(2.05) |
|
Year
Ended June 30, 2023 |
34.90 |
0.32 |
3.01 |
3.33 |
(0.28) |
(3.59) |
(3.87) |
|
Year
Ended June 30, 2022 |
43.69 |
0.24 |
(2.97) |
(2.73) |
(0.16) |
(5.90) |
(6.06) |
|
Year
Ended June 30, 2021 |
31.12 |
0.17 |
15.09 |
15.26 |
(0.29) |
(2.40) |
(2.69) |
|
Year
Ended June 30, 2020 |
38.02 |
0.33 |
(5.35) |
(5.02) |
(0.33) |
(1.55) |
(1.88) |
|
Class
C |
|
|
|
|
|
|
|
|
Year
Ended June 30, 2024 |
32.43 |
0.09 |
3.11 |
3.20 |
(0.17) |
(1.71) |
(1.88) |
|
Year
Ended June 30, 2023 |
33.10 |
0.13 |
2.86 |
2.99 |
(0.07) |
(3.59) |
(3.66) |
|
Year
Ended June 30, 2022 |
41.77 |
0.03 |
(2.80) |
(2.77) |
— |
(5.90) |
(5.90) |
|
Year
Ended June 30, 2021 |
29.77 |
(0.02) |
14.44 |
14.42 |
(0.02) |
(2.40) |
(2.42) |
|
Year
Ended June 30, 2020 |
36.44 |
0.14 |
(5.14) |
(5.00) |
(0.12) |
(1.55) |
(1.67) |
|
Class
I |
|
|
|
|
|
|
|
|
Year
Ended June 30, 2024 |
34.99 |
0.37 |
3.37 |
3.74 |
(0.42) |
(1.71) |
(2.13) |
|
Year
Ended June 30, 2023 |
35.48 |
0.40 |
3.07 |
3.47 |
(0.37) |
(3.59) |
(3.96) |
|
Year
Ended June 30, 2022 |
44.30 |
0.34 |
(3.02) |
(2.68) |
(0.24) |
(5.90) |
(6.14) |
|
Year
Ended June 30, 2021 |
31.51 |
0.27 |
15.30 |
15.57 |
(0.38) |
(2.40) |
(2.78) |
|
Year
Ended June 30, 2020 |
38.48 |
0.43 |
(5.42) |
(4.99) |
(0.43) |
(1.55) |
(1.98) |
|
Class
L |
|
|
|
|
|
|
|
|
Year
Ended June 30, 2024 |
35.66 |
0.43 |
3.43 |
3.86 |
(0.48) |
(1.71) |
(2.19) |
|
Year
Ended June 30, 2023 |
36.09 |
0.47 |
3.12 |
3.59 |
(0.43) |
(3.59) |
(4.02) |
|
Year
Ended June 30, 2022 |
44.98 |
0.43 |
(3.09) |
(2.66) |
(0.33) |
(5.90) |
(6.23) |
|
Year
Ended June 30, 2021 |
31.96 |
0.36 |
15.51 |
15.87 |
(0.45) |
(2.40) |
(2.85) |
|
Year
Ended June 30, 2020 |
38.99 |
0.52 |
(5.48) |
(4.96) |
(0.52) |
(1.55) |
(2.07) |
(a)
Calculated
based upon average shares outstanding.
(b)
Includes
adjustments in accordance with accounting principles generally accepted in the
United States of America and as such, the net asset values for financial
reporting purposes and the returns based upon those net asset values may differ
from the net asset values and returns for shareholder transactions.
(c)
Includes interest expense, if
applicable, which is less than 0.005% unless otherwise noted.
126 |
