Page 18 - Investment Advisor September 2021

ETF ADVISOR

FUNDS MAKING CHANGE they would not require shareholder Bloomberg noted that two other
The four mutual funds converting to approval prior to implementation.” The major advantages of conversions are
ETFs are: boards, however, will request that share- that the ETF gets to keep the investor
• JPMorgan International Research holders elect a common board of 16 base and assets, and that it can market
Enhanced Equity Fund (OEIAX: to govern the entire J.P. Morgan Fund its former performance.
AUM $5 billion) complex, the company said. Dimensional Fund Advisors also
• JPMorgan Market Expansion J.P. Morgan Asset Management cur- plans to convert two more of its inter-
Enhanced Index Fund (OMEAX: rently has a U.S. ETF suite of 36 prod- national mutual funds to ETFs later this
AUM $1.1 billion) ucts with more than $64 billion in assets, year, Sotiroff said.
• JPMorgan Realty Income Fund “As a leading active manager, it is He added that he’s not sure how far
(URTAX: AUM $2.2 billion) important to us that we continue to this trend could go as there are some
• JPMorgan Inflation Managed Bond deliver our investment capabilities in hurdles. For example, giving $10,000
Fund (JIMAX: AUM $1.4 billion) the vehicle that meets our clients’ to a mutual fund company means
J.P. Morgan Asset Management has desired outcomes,” said Bryon Lake, that amount is fully invested, while
$2.6 trillion in assets under management head of Americas ETFs, in a state- with an ETF, an investor can only buy
as of June 30, 2021. ment. “The intraday liquidity, trans- whole shares.
Before the conversion can take place, parency and potential tax benefits “So there are pros and cons to it,”
each mutual fund board must approve that come with ETFs carry significant Sotiroff said. “But I think there are
the move. The firm noted that “it is value to many investors, and these more advantages on the ETF side, so
anticipated that if the conversions are particular strategies are well suited I wouldn’t be surprised to see more of
approved by the boards of the funds, for the ETF structure.” these conversions.”

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16 INVESTMENT ADVISOR SEPTEMBER 2021 | ThinkAdvisor.com