JM Large Cap Fund Growth INF192K01601

JM Large Cap earns an Above Average Process Pillar rating.

The most significant contributor to the rating is the parent firm's five-year risk-adjusted success ratio of 82%. The measure indicates the percentage of a firm's funds that have outperformed their respective category's median return for the period. Impressive risk-adjusted performance also bolsters the rating. This can be seen in the fund's five-year alpha calculated relative to the category index, which suggests that the managers have shown skill in their allocation of risk. However, the process is limited by being an actively managed strategy. Historical data, like Morningstar's Active/Passive Barometer, finds that actively managed funds have generally underperformed their passive counterparts, especially over longer time horizons.

This strategy leans toward smaller, more undervalued companies compared with its average peer in the Large-Cap Morningstar Category. Looking at additional factor exposure, this strategy has continually had exposure to high-momentum stocks compared with Morningstar Category peers in the last few years. Momentum is based on the premise that stocks that have recently outperformed will continue to outperform, and those that have underperformed will stay behind. In recent months, the strategy was more exposed to the Momentum factor compared with its Morningstar Category peers as well. This strategy has also exhibited a tilt towards more high-liquid assets over peers in recent years, evidenced by consistently holding companies with relatively higher trading volumes. More-liquid assets are easier to buy and sell without adversely moving their prices and tend to provide some ballast during market selloffs. They also are easier to sell to meet redemptions if a host of investors decide to leave the fund in a short period of time. In the most recent month, however, the fund's Liquidity exposure was in line with the Morningstar Category average. During the last few years, this strategy has also tilted in favor of high-quality stocks, those that have demonstrated low financial leverage and solid return on equity. Though it may trail peers during an economic boom, this orientation contributes to helping it weather periods of economic stress better. In this month, the strategy also had more exposure to the Quality factor over its peers. More information on a fund and its respective category's factor exposure can be found in the Factor Profile module within the Portfolio section.

The portfolio is overweight in financial services by 3.4 percentage points in terms of assets compared with the category average, and its consumer defensive allocation is similar to the category. The sectors with low exposure compared with category peers are energy and utilities, with energy underweighting the average portfolio by 7.1 percentage points of assets and utilities similar to the average. The strategy owns 44 securities and is diversified among those holdings. In its most recent portfolio, 44.5% of the portfolio's assets were concentrated in the top 10 fund holdings, compared to the category’s 51.8% average. And finally, in terms of portfolio turnover, looking at year-over-year movements, 199% of the fund's holdings have turned over, whether through increasing, decreasing, or changing a position.