JP Morgan Funds, the US mutual fund business of JPMorgan Asset Management, launched a new tax-exempt fixed income fund, meant to maximize after-tax inflation-protected returns by investing in a portfolio of inflation-linked and tax-exempt securities.
The JPMorgan Tax Aware Real Return Fund is managed by Deepa Majmudar and Richard Taormina.
“This fund will allow investors to diversify their portfolio while at the same time potentially reduce their taxable income and guard against a loss of purchasing power due to inflation,” said Connie Plaehn, managing director and head of retail fixed income at JPMorgan Asset Management. “This combination of strategies has not previously been broadly accessible to taxpaying investors.”
The Fund takes advantage of the developing inflation-linked securities market by trying to create a cost-effective inflation shield in the portfolio. It favors long-term gains over ordinary income or short-term gainss and uses tax-efficient, active portfolio management that seeks to harvest losses to offset potential taxable gains.
The funds uses the Lehman Brothers U.S. 1-10 Year TIPS Index as a measure of inflation-protected return. It is offered in A (TXRAX), C (TXRCX), Select (TXRSX) and Institutional (TXRIX) share classes. It has a $1,000 minimum investment (A and C shares).