JP Morgan Natural Resources Fund

by Richard Allum on 13 July 2008

One of the most popular sectors in recent years has been commodities and this fund from JPM has been used by many paraplanners and advisers, Fund Legal Name: JPM Natural Resources Fund      

Manager: JP Morgan Asset Management

Initial Charge: 4.25%

AMC: 1.5%

Launch Date: 01 June 1965

IMA Sector: UT Specialist

Aim: The JPM Natural Resources Fund invests primarily in the shares of companies throughout the world engaged in the production and marketing of commodities.  The fund aims to provide capital growth over the long term.

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Commentary:  The JPM Natural Resources fund is one of the few open ended funds that allows investors to invest exclusively in the commodities market.

JPM Natural Resources fund is broadly diversified across more than 100 commodities in the stock world.  It has the freedom to target both large and small companies and can invest in any area of the market from oil and gas to gold and basic materials.

Fund manager Ian Henderson is confident that the supply shortage of many established and emergent commodities and increasing demand from emerging markets for infrastructure projects will continue to drive strong returns from the natural resources sector for years to come.  However, many market commentators, including George Soros, are raising concerns as to whether there is a global commodity bubble, with too much money chasing too few commodities.

There exists speculation as to whether a commodities fund is required to provide exposure to the asset class within a diversified portfolio.  Nearly a fifth of the average UK equity fund is likely to be in oil and mining already, with about 16% of the FTSE 100 accounted for by resources companies.  It could be argued that investing in a pure commodities fund is the same mistake we all made with tech stocks.  Vodafone was such a big component of the index at the time that we didn’t need a specialist tech scheme.

{ 1 comment… read it below or add one }

peter 3 November 2010 at 23:56

ive split a 40% of my pension on this fund. there will be high and lows but i think at the end of my pension term (if there wont be a 3rd world war) the sign will be +

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