JPMorgan American’s results for 2014 show the fund just beat its benchmark, the US market, as measured by the S&P 500 total return Index in sterling terms, provided a return of 20.4%. By contrast the net asset value total return was 20.8%. The share price return was 22.6%. They are paying a dividend of 3.25p for the year, up from 2.7p for 2013.
Garrett Fish’s manager’s statement says one feature was a strong technology sector, holdings in Apple, Yahoo, Hewlett Packard and SanDisk all helped performance. In healthcare, Walgreen Boots Alliance and CVS Health were also beneficial.
By contrast stock selection in the consumer discretionary and financial services sectors detracted slightly. Within consumer discretionary exposure to General Motors and Staples for some of the period under review disappointed as both stocks sold off on stock specific issues. General Motors suffered from negative investor sentiment over numerous recall-related issues. While General Motors’ valuation remains attractive, they have concerns how long the recalls will act as an overhang as litigation remains pending. Staples’ earnings came under pressure as the struggling office-supplies retailer was faced with weaker than expected sales due to a reduction in traffic falls in the face of stronger online competition and weaker demand for traditional office supplies. While the company is closing underperforming stores and trying to increase its online growth, they have fundamental concerns on how quickly the company can reignite sales growth.
In the financials sector, a lack of exposure to Berkshire Hathaway hurt, as the name rallied strongly.
JAM : JPMorgan American helped by technology weighting