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- JPMorgan Global Convertibles hit by oil exposure
Over the second half of 2014 JPMorgan Global Convertibles Income generated a negative return on net assets of -4.8%. The return to shareholders was -5.8%. Two quarterly interim dividends of 1.125p have been declared so far. The target is to pay 4.5p for the year as a whole.
Discussing the performance, the investment manager mentions energy market weakness (as the oil price has fallen), cheapening convertible valuations and “stress in high yield markets”. They had hedged the US dollar and so didn’t get the benefit of the strengthening dollar in the period. They have been switching their oil exposure into companies that they think can withstand the current level of oil prices.
JGCI : JPMorgan Global Convertibles hit by oil exposure