London, UK – JPMorgan has introduced a new fixed income exchange-traded fund, the Jpmorgan Active Bond ETF (JBND), offering a fresh opportunity in the actively managed fund space. This debut in October 2023 marks a significant addition to the JPMorgan portfolio, complementing the established JPMorgan Income ETF (JPIE).

The JBND ETF aims to deliver total returns through actively managing a portfolio of U.S. investment-grade bonds. Distinct from JPIE, JBND focuses on a higher duration of six years, with a greater emphasis on securitized products compared to corporate paper.

Examining JBND’s portfolio composition reveals a significant allocation to Treasury and Agency MBS paper, while corporate bonds and ABS securities also feature prominently. With a strong concentration in highly-rated assets, JBND is poised for low credit spread sensitivity and high interest rate dependence due to its six-year duration.

In terms of performance and analytics, JBND has showcased a robust total return of 12.5% since its inception, outperforming comparable ETFs like the iShares 7-10 Year Treasury Bond ETF (IEF) by leveraging active management strategies. By actively navigating fixed income market distortions, JBND has demonstrated its ability to capitalize on opportunities and mitigate risks effectively.

Investors seeking exposure to the intermediate yield curve with a preference for active management may find JBND appealing. Positioned as an intermediate rates play, JBND’s composition and performance suggest a promising investment opportunity in the current macroeconomic environment, especially considering the anticipated rate cuts by the Federal Reserve in September 2024.

With a focus on the active approach and objectives of JBND, investors are encouraged to consider a buy-and-hold strategy with a two-year horizon in mind. The ETF’s strong performance and strategic positioning make it a compelling choice for those looking to capitalize on the dynamics of the fixed income market.