J.P. Morgan Asset Management on Friday launched the JPMorgan Ultra-Short Income ETF (JPST), an actively managed exchange-traded fund the company says aims to provide current income while maintaining low volatility of principal.
According the fund’s prospectus, JPST will invest mainly in investment grade, U.S. dollar-denominated short-term fixed, variable and floating rate debt. As part of its principal investment strategy, the fund may invest in corporate securities, asset-backed securities, mortgage-backed and mortgage-related securities, and high-quality money market instruments such as commercial paper and certificates of deposit.
It will seek to maintain a duration of one year or less.
JPST will have a sizable focus on the banking industry and will invest more than 25 percent of its assets in securities issued by banks, though that amount might drop to less than 25 percent as a temporary defensive measure when conditions call for it.
The fund’s expense ratio is 0.18 percent.
J.P. Morgan Asset Management rolled out its first ETFs in 2014, and now has 13 ETFs with more than $1 billion in assets under management.