JPMorgan Active Growth ETF

JGRO

Market cap $7.54B

JPMorgan Active Growth ETF is an actively managed large-cap ETF with a focus on information technology. Despite a promising start, JGRO has underperformed a number of passively managed growth ETFs since inception. JGRO still has to prove itself compared to peers with a better track record, lower fees, and higher liquidity.

JGRO, an actively managed ETF by JPMorgan, focuses on long-term capital appreciation through a portfolio of about 100 U.S. large-cap stocks. Despite skepticism towards actively managed ETFs, JGRO has outperformed passive ETFs like SPY and IWF, justifying its slightly higher fees. JGRO's portfolio, with a P/E ratio of 25 and a focus on consumer discretionary stocks like META and AMZN, continues to show potential for outperformance.

Despite the ETF industry's passive roots, active has stolen the show. Active ETF assets just topped the $1 trillion threshold, making up nearly 10% of the total ETF pie.

The JPMorgan Active Growth ETF follows a bottom-up approach, focusing on growth stocks and occasionally using derivatives for optimal equity exposure. Metrics suggest JGRO's strategy isn't as active as it may seem, and excess returns are astray. However, the vehicle provides compelling downside protection. Management is implementing a slight decrease in the portfolio's tech and AI exposure to depart from market sentiment and emphasise fundamentals.

JPMorgan Active Growth ETF is an actively managed large-cap ETF with a focus on technology, launched in August 2022. JGRO's performance was promising in its first 20 months, as reported in my review of April. However, it has lagged passive large-cap growth ETFs for 6 months.

Actively managed ETFs are growing rapidly, with new funds aiming to outperform benchmarks through quantitative or traditional analysis. JPMorgan Active Growth ETF focuses on underpriced growth stocks, utilizing a bottom-up methodology and experienced portfolio managers. JGRO heavily allocates to the Tech sector, with a focus on large-caps, but faces risks of active management not outperforming passive strategies and sector concentration.

We've been marveling at the traction actively managed ETFs are enjoying this year. As a category, we've seen active ETFs take in about 1/3 of all net asset inflows year-to-date.

JPMorgan Asset Management and Dimensional Fund Advisors make up about 40% of total active ETF assets.

JPMorgan Active Growth ETF is an actively managed ETF focused on companies with above-average earnings growth and leading competitive positions.

JGRO is an actively managed fund that favors companies with "strong earnings growth potential." Under the hood, JGRO is a growthier, more richly valued alternative to QQQ with a larger footprint in the financial sector and insignificantly weaker quality. Its past performance was truly robust, yet it was nonetheless unable to outcompete QQQ. It is less liquid, and it comes with a higher expense ratio.