1. finance
2. investing
3. stocks

US Equities: Where Do We Go From Here?
March 2015
Susan Bao, Managing Director
US Equity Portfolio Manager
J.P. Morgan Asset Management
FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
Investing with J.P. Morgan Asset Management’s Equity Platform
Our profile: Deeply resourced, research driven, global manager with decades of institutional investment experience
USD 234 bn in US Equity Assets

Strong belief and commitment to active management

Extensive, well-resourced research


–
Over USD 150 million annual research budget
–
Local focus with global inputs from research teams
in Asia and Europe
Investment performance culture
–
Investment team incentive compensation linked to fund performance
–
Equity investment teams invest alongside clients in their portfolios
Growth
41.9 bn
Behavioral
20.8 bn
Core
106.6 bn
Experience and stability
–
Investment professionals – average tenure:
16 years industry / 11 years with the firm
Value
65.2 bn
Note: Total assets exclude certain Private Bank assets. Core assets include REITs. Growth assets include all Active Mid and Small Cap strategies. AUM as at 31 December 2014.
1 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
US Equity fundamental strategies: portfolio management teams
Paul Quinsee
Head of U.S. Equity
Experience
 Industry: 30 years
 Firm: 23 years
Core
Portfolio Managers
Disciplined Equity
Portfolio Managers
Fundamental Alternative
Portfolio Managers
Tom Luddy
Raffaele Zingone
Hamilton Reiner
Experience
Experience
Experience
Industry: 38 yrs
 Firm: 38 yrs

Industry: 24 yrs
 Firm: 24 yrs

Susan Bao
Steven Lee
Rick Singh
Experience
Experience
Experience
Industry: 21 yrs
 Firm: 10 yrs




Industry: 17 yrs
Firm: 17 yrs

Scott Davis
Aryeh Glatter
Experience
Experience


Industry: 17 yrs
Firm: 8 yrs


Tim Snyder
Experience
Experience
Industry: 28 yrs
 Firm: 24 yrs



Industry: 27 yrs
Firm: 5 yrs
Industry: 14 yrs
Firm: 1 yr
Industry: 27 yrs
Firm: 4 yrs
Helge Skibeli


Industry: 11 yrs
Firm: 11 yrs
Value
Portfolio Managers
Growth /Small Cap
Portfolio Managers
Clare Hart
Experience
 Industry: 22 yrs
 Firm: 16 yrs
Eytan Shapiro, CIO
Growth & Small Cap
Experience
 Industry: 32 yrs
 Firm: 29 yrs
Giri Devulapally
Experience
 Industry: 23 yrs
 Firm: 12 yrs
Gloria Fu
Experience
 Industry: 19 yrs
 Firm: 13 yrs
Greg Luttrell
Experience
 Industry: 28 yrs
 Firm: 8 yrs
Larry Playford
Experience
 Industry: 21 yrs
 Firm: 21 yrs
Tim Parton
Experience
 Industry: 28 yrs
 Firm: 28 yrs
Scott Blasdell
Experience
 Industry: 20 yrs
 Firm: 15 yrs
Don San Jose
Experience
 Industry: 17 yrs
 Firm: 14 yrs
Jonathan Simon
Experience
 Industry: 34 yrs
 Firm: 34 yrs
As at 31 December 2014.
There can be no assurance that the professionals currently employed by J.P. Morgan Asset Management will continue to be employed by J.P. Morgan Asset Management or that the past performance
or success of any such professional serves as an indicator of such professional’s future performance or success.
2 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
Market Review & Outlook
3 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
Focus on the trend
S&P 500 Index
Equities
2,200
Characteristic
Index level
P/E ratio (fwd.)
Dividend yield
10-yr. Treasury
2,000
Mar-2000
Oct-2007
1,527
25.6x
1.1%
6.2%
1,565
15.2x
1.8%
4.7%
Dec-2014
Dec. 31, 2014
P/E (fwd.) = 16.2x
2,059
2,059
16.2x
1.9%
2.2%
1,800
Oct. 9, 2007
P/E (fwd.) = 15.2x
1,565
Mar. 24, 2000
P/E (fwd.) = 25.6x
1,527
1,600
1,400
+101%
+204%
+106%
1,200
-57%
-49%
1,000
Dec. 31, 1996
P/E (fwd.) = 16.0x
741
800
600
'97
'98
'99
Mar. 9, 2009
P/E (fwd.) = 10.3x
677
Oct. 9, 2002
P/E (fwd.) = 14.1x
777
'00
'01
'02
'03
'04
'05
'06
'07
'08
'09
'10
'11
'12
'13
'14
Source: Standard & Poor’s, First Call, Compustat, FactSet, J.P. Morgan Asset Management. Guide to the Markets – U.S. Data as at December 31, 2014.
Dividend yield is calculated as the annualized dividend rate divided by price, as provided by Compustat. Forward Price to Earnings Ratio is a bottom-up calculation based on the most recent S&P
500 Index price, divided by consensus estimates for earnings in the next 12 months (NTM), and is provided by FactSet Market Aggregates. Returns are cumulative and based on S&P 500 Index
price movement only, and do not include the reinvestment of dividends. Past performance is not indicative of future returns. For illustrative purposes only.
4 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
Valuation is moving beyond long run equilibrium
U.S. Equity: Valuation Measures
Valuation
Measure
P/E
CAPE
Div. Yield
REY
P/B
Description
Price to Earnings
Shiller's P/E
Dividend Yield
Real Earnings Yield
Price to Book
P/CF
Price to Cash Flow
EY Spread
EY Minus Baa Yield
1.5%
Historical Averages
1-year
5-year
ago
avg.
Latest
10-year
avg.
25-year
avg.*
16.2x
15.4x
13.5x
13.8x
15.6x
27.3
25.5
22.5
22.9
25.3
1.9%
1.9%
2.0%
2.0%
2.1%
3.7%
3.7%
4.3%
3.3%
2.3%
2.9
2.7
2.3
2.4
2.9
11.4
10.8
9.3
9.7
11.3
1.6%
2.2%
1.3%
-0.7%
S&P 500 Index: Forward P/E Ratio
Equity risk premiums vs IG corporates
26x
8%
24x
December 2014: 4.4%
ERP (IG corporates)
Average
6%
22x
20x
4%
18x
Current: 16.2x
16x
2%
Average: 15.6x
14x
12x
0%
10x
8x
'90
'92
'94
'96
'98
'00
'02
'04
'06
'08
'10
'12
'14
-2%
2000
2002
2004
2006
2008
2010
2012
2014
Source: J.P. Morgan Asset Management (Top and bottom left) Standard & Poor’s, FactSet, Robert Shiller Data, FRB. Price to Earnings is price divided by consensus analyst estimates of earnings per
share for the next 12 months. Shiller’s P/E uses trailing 10-years of inflation adjusted earnings as reported by companies. Dividend Yield is calculated as the trailing 12-month average dividend
divided by price. Real Earnings Yield is defined as (trailing four quarters of reported earnings/price) - year over year core CPI inflation. Price to Book Ratio is the price divided by book value per share.
Price to Cash Flow is price divided by NTM cash flow. EY Minus Baa Yield is the forward earnings yield (consensus analyst estimates of EPS over the next 12 months divided by price) minus the
Moody’s Baa seasoned corporate bond yield. *P/CF is a 20-year avg. due to cash flow data availability. Guide to the Markets – U.S. Data are as of 12/31/14. (Bottom right), Bloomberg; as of
12/31/14. Shown for illustrative purposes only. Equity risk premium is equal to J.P. Morgan Asset Management Dividend Discount Rate on S&P 500 stocks, less current yield to maturity on IG
corporate bonds. A DDR is the discount rate that equates the present value of the estimated stream of future dividends to the current market price. The J.P. Morgan S&P 500 DDR is a bottom-up,
sector-neutral and capitalization-weighted average of DDRs on large-capitalization stocks as estimated by J.P. Morgan Asset Management equity research analysts.
A DDR does not represent a stock's expected actual return in any given time period. Past performance does not guarantee future results.
For illustrative purposes only.
5 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
We believe we are in the overshoot phase
S&P 500 Performance and Average Valuation
S&P 500 earnings yield vs. Baa bond yield
Price returns to peak after crossing average real earnings yield
300%
14%
Returns to peak price after average valuation
Returns before markets pass average valuation
12%
240%
S&P 500 Earnings Yield
(Inverse of fwd. P/E): 6.2%
“Average valuation” is
defined as the average real
earnings yield of the S&P 500
from 1963 until today
0%*
10%
83%
180%
8%
49%
120%
0%
6%
30%
4%
60%
4%
16%
15%
Moody’s Baa Yield: 4.7%
29%
49%
73%
'66
'70
'74
121%
59%
180%
101%
204%
'90
'02
'09
0%
2%
'90
'92
'94
'96
'98
'00
'02
'04
'06
'08
'10
'12
'14
'82
'87
Start of Bull Market
Source: Standard & Poor’s, J.P. Morgan Asset Management. Guide to the Markets – U.S. Data as at December 31, 2014. (Left) Price to Earnings is price divided by consensus analyst estimates of
earnings per share for the next 12 months. Real Earnings Yield is defined as (trailing four quarters of reported earnings/price) - year over year core CPI inflation. (Right) Valuations are based on real
earnings yield for the S&P 500 which is defined as (trailing four quarters of reported earnings/price) - year over year core CPI inflation. Period after average valuation defined by 15-day moving
average passing below average real earnings yield. *As depicted on the left hand chart, the return to peak price for the current bull market is 0% as the S&P 500 has yet to cross its long run average
real earnings yield. The S&P 500 would need to appreciate over 22% to reach its long-term average real earnings yield of 2.5%. For illustrative purposes only.
6 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
… And it could be years before the next recession
“Goldilocks” income growth: from job gains, not wages
Labor market and capex still far from overheating
25-54 year old males, % employed
YoY % change
% GDP
90
8
Employment to
population
88
9%
6%
7
Business
investment
86
3%
6
0%
84
5
82
80
1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012 2014
-3%
U.S. income growth
Employment growth
Wage inflation
-6%
4
1990
1995
2000
2005
2010
Durable goods and fixed investment as % of GDP
US: Household debt/income and debt service ratios
% of GDP
%, seasonally adjusted
30%
15
28%
14
26%
9/14
24.0%
12
11
20%
10
18%
56
61
66
71
76
81
86
91
96
01
120
110
22%
51
Debt to disposable
income
13
LT average:
25.7%
24%
130
06
Debt
service
100
90
9
11
80
90
95
00
05
10
Source: Federal
reserve
Source: (Top left) BEA, BLS, J.P. Morgan PB Economics. Q3 2014 (Top right) BLS, J.P. Morgan PB Economics.
December
2014 (Bottom left) J.P. Morgan and BEA (Bottom right) Federal Reserve;
data available as of December 31, 2014. Opinions, estimates, forecasts, projections and statements of financial market trends that are based on current market conditions constitute our judgment and
are subject to change without notice. There can be no guarantee they will be met. For illustrative purposes only.
7 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
7
Earnings – down, but driven by energy
S&P 500 Earnings Per Share
Quarterly, operating earnings
S&P 500 Earnings Picture
4Q14: USD 27.14
Consensus Fiscal Year Earnings (USD bn)
$30
$26
$22
$18
$14
$10
Sources: Standard & Poor's, J.P. Morgan Asset Management. Fourth quarter earnings per share is
an estimate from J.P. Morgan Asset Management. For illustrative purposes only. Data as at
February 12, 2015.
2014E
2015E
Growth
Consumer Discretionary
16.80
19.45
15.75%
Information Technology
18.54
20.84
12.35%
Health Care
16.60
18.12
9.21%
Materials
3.80
4.10
7.92%
Financials
23.22
24.40
5.07%
Industrials
10.94
11.41
4.27%
Telecommunication Services
4.77
4.92
3.25%
Consumer Staples
7.28
7.25
-0.35%
Utilities
4.29
4.25
-1.02%
Energy
12.01
5.96
-50.38%
S&P 500
118.26
120.70
2.07%
S&P 500 Ex-Energy
106.25
114.74
8.00%
Source: J.P. Morgan Asset Management. As at February 20, 2015.
8 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
Corrections are normal, but we should stay focused on improving trends
Source: Standard & Poor’s, FactSet, J.P. Morgan Asset Management. Guide to the Markets – U.S. Data as at December 31, 2014.
Returns are based on price index only and do not include dividends. Intra-year drops refers to the largest market drops from a peak to a trough during
the year. For illustrative purposes only. *Returns shown are calendar year returns from 1980 to 2014.
9 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
Rising rates should not derail the equity rally, but sector performance could
depend in part on interest rates
Sector correlations to rates
2-year rolling, 1994-2014
Correlations Between Weekly Stock Returns and Interest Rate Movements
Weekly S&P 500 returns, 10-year Treasury yield, rolling 2-year correlation, May 1963 – Dec. 2014
Current
0.8
When yields
are below
5%, rising
rates are
generally
associated
with rising
stock prices
Correlation Coefficient
0.6
Positive
relationship
between
yield
movements
and stock
returns
0.4
0.2
Min
Graph Key
Max
Average
Last 12 Months
1963  12 Months Ago
Utilities
Less positively
correlated with
rising interest
rates
Telecom
Cons. Staples
Materials
0
Technology
-0.2
Health Care
Negative
relationship
between
yield
movements
and stock
returns
-0.4
Energy
Cons. Disc.
More positively
correlated with
rising interest
rates
S&P 500
-0.6
Industrials
-0.8
0%
2%
4%
6%
8%
10%
12%
14%
16%
Financials
10-Year Treasury Yield
Source: Standard & Poor’s, U.S. Treasury, FactSet, J.P. Morgan Asset Management. Guide to the Markets – U.S. Data as at December 31, 2014.
Returns are based on price index only and do not include dividends. Markers represent monthly 2-year correlations only.
10 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
-1.00 -0.50 0.00
0.50
1.00
Position for the long term and not the short term playbook
S&P 500 Sector Returns - 2014
S&P 500 Sector Returns - 2013
Network Hardware (Apple)
Media
34.1%
Health Services & Systems
30.2%
Financial Services
REITs
29.8%
Insurance
Semiconductors
27.3%
Utilities
26.3%
Pharm/MedTech
45.5%
Auto & Transportation
43.8%
Regionals
42.4%
Pharm/MedTech
19.8%
Retail
50.1%
Health Services & Systems
25.2%
Auto & Transportation
56.0%
53.5%
41.0%
Consumer Cyclical
16.4%
Consumer Cyclical
14.1%
Industrial Cyclical
S&P500 Index
13.7%
Big Banks & Brokers
Consumer Stable
13.5%
Semiconductors
Software & Services
13.3%
S&P500 Index
Big Banks & Brokers
13.1%
Retail
39.7%
39.3%
37.9%
33.6%
32.4%
30.8%
Regionals
11.8%
Basic Materials
Financial Services
11.5%
Software & Services
25.6%
Energy
25.3%
Insurance
9.3%
Industrial Cyclical
Consumer Stable
7.9%
Telecommunications
7.1%
Telecommunications
Basic Materials
6.8%
Systems & Network Hardware
Media
3.6%
REITs
-4.0%
6.0%
23.8%
21.3%
17.0%
Utilities
Energy-9.0%
-14.0%
27.4%
16.0%
26.0%
36.0%
0.0%
14.1%
1.1%
10.0%
20.0%
30.0%
40.0%
50.0%
Source: Wilshire; J.P. Morgan Asset Management sector classification. Data as at December 31, 2014. For illustrative purposes only. Past performance is no guarantee of future results.
11 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
60.0%
S&P 500 2014 Sector Leadership
S&P 500 performance in 2014 has been driven by systems & hardware (Apple), semiconductors & defensives
(particularly utilities, REITs and health services)
Over/Under performance - Relative to S&P 500 index
Near - Cyclicals
Cyclicals
Defensives
30.0%
20.4%
20.0%
16.1% 16.5%
13.6%
10.0%
11.6% 12.6%
6.1%
0.4%
2.8%
0.0%
-0.4%
-10.0%
-6.9%
-4.4%
-5.8%
-2.2%
-1.9%
-0.2%
-0.6%
-6.6%
-10.1%
-20.0%
-22.7%
-30.0%
Source: Wilshire; J.P. Morgan Asset Management sector classification. Data as at December 31, 2014. For illustrative purposes only. Past performance is no guarantee of future results.
12 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
Fundamentals continue to support our key investment thesis
Portfolio positioning:
Relative to S&P 500 Index
Overweights
Outlook:
Underweights
Bond proxies
Autos & Transportation
Defense
Insurance
Utilities
Cyclical recovery
Semiconductors
Consumer Stable
Big Banks & Brokers
REITs
Quality/GARPy
Rate normalization
Source: J.P. Morgan Asset Management. Data as at December 31, 2014. Sector deviations are derived from representative accounts across various active large cap core strategies Actual account
information may differ. Data as of September 30, 2014. Shown for illustrative purposes only. Opinions, estimates, forecasts, projections and statements of financial market trends that are based on
current market conditions constitute our judgment and are subject to change without notice. There can be no guarantee they will be met.
13 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
A tale of two cities: Utilities vs. Financials
%
100
Utility Stocks Correlation of Relative Returns with the Total Return of Long
Treasury Bonds1
1929 Through 2014
Correlation between large banks and treasury bonds
1933 through 2013
%
80
80
60
60
40
40
20
20
0
0
(20)
(20)
(40)
(40)
(60)
(60)
(80)
(80)
29
34
39
44
49
54
59
64
69
74
79
84
89
94
99
04
09
14
S&P utilities forward P/E relative to S&P500
1.4x
LT average
33 37 41 45 49 53 57 61 65 69 73 77 81 85 89 93 97 01 05 09 13
%
4.5
LT average of banks
1.2x
4.0
1.0x
3.5
0.8x
3.0
0.6x
2.5
0.4x
2.0
99 00 01 02 03 04 05 06 07 08 09 10 11 12 13 14 15
U.S. Commercial Banks and Savings Institutions Net Interest Margins
1984 Through Q2 2014
Assets > $10 Billion
84
86
88
90
92
94
96
98
00
02
04
All
06
08
10
12
14
Source:
(Top Left) National Bureau of Economic Research, Ibbotson Associates, Bloomberg LP, Empirical Research Partners Analysis. 1 Constructed using trailing two-year data; Returns are capitalization
Source:
weighted. (Bottom Left) Bloomberg. Data as at January 21, 2015 (Top Right ) Bloomberg, National Bureau of Economic Analysis, Empirical Research Partners Analysis. 1 Constructed using trailing two-year,
capitalization weighted returns. Data smoothed on trailing three month basis.
Data are as at December 31, 2014. (Bottom Right) Federal Deposit Insurance Corporation, Empirical Research Partners Analysis. For illustrative purposes only.
14 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
We prefer quality / GARPy stocks
Trailing P/E ratios of dividend growth and yield
3.0x
Dividend Growth
is More
Highly-Valued
2.5
2.0
Average
1.5
1.0
Dividend Yield
is More
Highly-Valued
0.5
52
57
62
67
72
77
82
87
92
97
02
07
12
Examples of GARPy Qualities: Schlumberger, ACE, Marsh & McLennan, Wells Fargo, Time Warner, Honeywell, Google
Source: Corporate Reports, Empirical Research Partners Analysis. Capitalization-weighted data. All data as at December 2014. The companies/securities above are shown for illustrative purposes
only. Their inclusion should not be interpreted as a recommendation to buy or sell. J.P. Morgan Asset Management may or may not hold positions on behalf of its clients in any or all of the
aforementioned securities.
GARPy refers to companies which are perceived to be Growth At A Reasonable Price.
15 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
We expect 2015 to be a better year for housing
Housing Affordability Index
GTM – U.S.
Existing Home Sales
Avg. mortgage payment as a % of household income
Units, seasonally adjusted annual rates
40%
7,000,000
35%
6,000,000
30%
Nov. 2014: 12.1%
25%
5,000,000
Average: 5.3m
20%
Average: 19.7%
15%
Nov. 2014: 4.9m
4,000,000
3,000,000
10%
'75
'78
'81
'84
'87
'90
'93
'96
'99
'02
'05
'08
'11
'00
'14
New Home Sales
'02
'04
'06
'08
'10
'12
'14
Conventional Mortgage Rate (30-year)
Thousands of units, seasonally adjusted
Jan. 2005 – Dec. 2014
1,600
7.0%
1,400
6.5%
6.0%
1,200
5.5%
1,000
5.0%
800
4.5%
Average: 746
600
Dec. 2014: 3.86%
Nov. 2014: 438
400
4.0%
3.5%
3.0%
200
'90
'92
'94
'96
'98
'00
'02
'04
'06
'08
'10
'12
'14
'05
'06
'07
'08
'09
'10
'11
'12
'13
'14
Source: (all charts except bottom right) U.S. Census Bureau, National Association of Realtors, J.P. Morgan Asset Management. All data as at December 2014. Averages are 20-year for Housing
Starts and New Home Sales, while Existing Home Sales average is from earliest available data in January 1999. (Bottom Right) Federal Reserve, Primary Mortgage Market Survey® data provided
by Freddie Mac. For illustrative purposes only.
16 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
Investment Process
17 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
A simple, but powerful philosophy drives our investment thinking

Stock prices ultimately reflect future earnings and
cash flows

Stocks are frequently mispriced by the market
relative to their true long-term value

A consistent investment approach that exploits
mispricings can deliver superior investment results
Valuation
Fair value
Actual Stock
Price
Time
This chart is included for illustrative purposes only.
Source: J.P. Morgan Asset Management, for illustrative purposes only
18 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
We believe there are three critical steps to producing consistent alpha that can be
captured in a highly structured process
Research advantage
Fundamental research

US analyst team of
buy-side, sector-specialists

Global network of
analysts expands our
information sources
Optimized
portfolio
construction
Systematic research
and valuation model
Dividend discount model



Analyst team forecasts
normalized and
sustainable earnings
Proprietary earnings
and cash flow estimates drive
our dividend discount rates
(DDRs)
Stocks ranked into
quintiles based on DDRs
19 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
Stock selection focused

Stock rankings adjusted
to reflect timing and confidence

Minimize uncompensated risks
(beta, sector, style)

Maximize stock
specific bets within
risk control bands
A team of skilled investors with an average of 17 years of experience
Industrials
Helge Skibeli
Managing Director
Director of Research
29 yrs. of experience
25 yrs. with the firm
Kay Herr *
Managing Director
Associate Director
of Research
21 yrs. of experience
15 yrs. with the firm
James Brown
Managing Director
Basic Materials
30 yrs. of experience
27 yrs. with the firm
Nishesh Kumar
Managing Director
Energy
18 yrs. of experience
17 yrs. with the firm
David Pasquale
Managing Director
Industrial Cyclicals
18 yrs. of experience
9 yrs. with the firm
Chris Ceraso
Executive Director
Autos and Transport
14 yrs. of experience
1 yr. with the firm
Mike Leskinen
Executive Director
Aerospace & Defense
14 yrs. of experience
2 yrs. with the firm
Technology
Financials
Urmas Wompa
Managing Director
Finance
31 yrs. of experience
28 yrs. with the firm
David Maccarrone
Executive Director
Infrastructure
20 yrs. of experience
4 yrs. with the firm
Steven Wharton
Managing Director
Capital Markets
19 yrs. of experience
9 yrs. with the firm
David Small
Executive Director
Insurance
14 yrs. of experience
9 yrs. with the firm
Jason Ko
Executive Director
REITs/Specialty
Finance
13 yrs. of experience
13 yrs. with the firm
Matthew Rand
Vice President
REITs
12 yrs.experience
1 yr. with the firm
Robert Bowman
Managing Director
Semi/Hardware/Network
22 yrs. of experience
22 yrs. with the firm
Lerone Vincent
Executive Director
Basic Materials
16 yrs. of experience
16 yrs. with the firm
Joanna Shatney
Executive Director
Industrials
19 yrs. of experience
<1 yr. with the firm
Telecom & Utilities
Nitin Bhambhani
Managing Director
Software and Services
21 yrs. of experience
19 yrs. with the firm
Laura Huang
Vice President
IT Services
10 yrs. of experience
10 yrs. with the firm
Leslie Rich
Executive Director
Utilities
21 yrs. of experience
4 yrs. with the firm
Dr. Charles Silberstein
Executive Director
Health Care
19 yrs of experience
Firm: < 1 yr
Daphne Karydas
Executive Director
Health Care
19 yrs of experience
Firm: < 1 yr
Ryan Vineyard
Executive Director
Telecom
10 yrs. of experience
3 yrs. with the firm
Healthcare
Consumer
Consumer
Kathleen Stack
Managing Director
Consumer Stable
37 yrs. of experience
33 yrs. with the firm
Kris Erickson
Executive Director
Media
14 yrs. of experience
2 yrs. with the firm
Lisa S. Sadioglu
Executive Director
Consumer
14 yrs. of experience
14 yrs. with the firm
Greg Fowlkes
Managing Director
Retail
15 yrs. of experience
10 yrs. with the firm
Massimo Marolo
Executive Director
Retail
13 yrs. of experience
9 yrs. with the firm
Tim Gamache
Vice President
Consumer
10 yrs. of experience
10 yrs. with the firm
Laurence McGrath
Executive Director
Health Svcs/Medtech
18 yrs. of experience
4 yrs. with the firm
Kay Herr is also a co-portfolio manager for the REIT strategies. Note: Research Analysts Include VP’s and above. As at 31 December 2014
There can be no assurance that the professionals currently employed by J.P. Morgan Asset Management will continue to be employed by J.P. Morgan Asset Management or that the past performance
or success of any such professional serves as an indicator of such professional’s future performance or success.
20 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
The short-term focus of sell-side research can create opportunities
Number of sell-side analysts making 1 year earnings forecasts
Number of sell-side analysts making 5 year growth forecasts
Average S&P 500 Company
37
Microsoft
Schlumberger
General Mills
26
19
19
3
Next fiscal year earnings forecast
4
5 year earnings growth estimate
Shown for illustrative purposes only. The inclusion of the securities mentioned above is not to be interpreted as recommendations to buy or sell
Source: J.P. Morgan Asset Management. Data as at December 31, 2014.
21 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
6
5
Our analysts’ long term forecasts drive our ranking of stocks in each sector
In depth fundamental research + long term forecasting framework => Dividend discount ranking
Robert Bowman
Ranking
Semiconductors/Hardware/Network
Lam Research
Quintile
Quintile
1 1
Undervalued
22 years of experience
Cisco Systems
Cheap
Earnings per share
Normalized earnings growth
Short-term
earnings

Normalized
earnings

Long-term
growth rate
Quintile
Quintile
2 2
Quintile
Quintile
3 3
Quintile 4
Quintile 4
Quintile
Quintile
5 5
Overvalued
Expensive
Years
1&2
Year
3
Years
4-8
Intel
Seagate
Technology
J.P. Morgan’s security
ranking by long-term value
Note: Quintiles are 20% by number of names, not capitalization. The information on this page is for example purposes only and does not necessarily reflect current estimates. The inclusion of the
securities mentioned above is not to be interpreted as recommendations to buy or sell. The above chart is for illustrative purposes only.
22 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
Our research rankings have added value for almost three decades
January 1, 1986 – December 31, 2014
Quintile performance vs. S&P 500 Index
On average, undervalued stocks have outperformed…
…and expensive stocks have underperformed
4.0%
3.0%
2.0%
Percent
1.0%
0.0%
-1.0%
-2.0%
-3.0%
-4.0%
-5.0%
Quintile 1
Quintile 2
Quintile 3
Quintile 4
Quintile 5
Source: J.P. Morgan Asset Management
Chart shows performance of quintiles (as determined by J.P. Morgan research universe) versus the S&P 500 Index, with quintiles rebalanced monthly. Quintile performance represents the annualized
returns of quintiles vs. the annualized return of the S&P 500 over the full time period. Quintile performance results have certain inherent limitations. Unlike an actual performance record, quintile results
do not represent actual trading, liquidity constraints, fee schedules and transaction costs. No representation is being made that any portfolio will or is likely to achieve profits or losses similar to those
shown. Past performance is not indicative of future results.
23 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
JPMorgan Investment Funds – US Select Equity Fund
24 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
JPMorgan Investment Funds - US Select Equity Fund:
Performance Net of Fees
For the periods ended 28 February 2015
Three
Months
One
Year
Three
Years
Five
Years
Seven
Years
Since PM
Inception2
JPM US Select Equity - A (acc) USD
3.24%
14.06%
16.94%
14.41%
8.31%
7.84%
S&P 500 Net1
2.16%
14.80%
17.25%
15.45%
8.42%
7.26%
Excess Return
1.08%
-0.74%
-0.31%
-1.04%
-0.11%
0.58%
Morningstar Quartile
1 S&P
1
2
1
1
1
-
500 Net 30% withholding tax. 2 Large Cap Core team assumed management 1 March 2006.
Performance over one year is annualized. Inception date of the fund is 31 July 1984.
Fund performance is shown based on the NAV of the share class A in USD with income reinvested including ongoing charges, excluding entry and exit fees. Past performance is not an indication of
future performance.
Morningstar Rankings/Universe and Morningstar Percentile: © Morningstar. All Rights Reserved
Source: J.P. Morgan Asset Management, Morningstar.
25 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
JPMorgan Investment Funds - US Select Equity Fund:
One year performance attribution
For the one year period ending 28 February 2015
Stock attribution2
Ending
Weight Diff (%)
Positive Contributors
1
Attribution Summary
Negative
Contributors
Impact (%)
Stock:
Sector:
Ending
Weight Diff (%)
+1.07%
+0.12%
Impact (%)
Avago Technologies
1.72
0.69
Fluor
0.71
-0.41
Time Warner
0.99
0.52
General Motors
1.50
-0.21
Lowe's
1.50
0.26
Berkshire Hathaway*
-1.44
-0.21
0.91
-0.20
-0.01
-0.19
IBM
United Continental Holdings
3
-0.49
0.22
Google
0.80
0.21
Qualcomm
Sector attribution (relative to S&P 500)
1.2%
0.6%
0.5%
0.3%
0.2%
0.2%
0.2%
0.2%
0.1%
0.1%
0.0%
0.0%
-0.1%
-0.1%
-0.1%
-0.2%
-0.3%
-0.4%
Industrial
Cyclical
Media
Consumer
Stable
Energy
REITs
Utilities
Pharm/MedTech
Financial
Services
Regionals
Consumer
Cyclical
Tele Communications
Insurance
Basic Materials
Software &
Services
Big Banks &
Brokers
Retail
Auto &
Transportation
Health Services
& System
Semi &
Hardware
-1.0%
1 Please note the attribution summary is based on the gross excess returns of the fund. 2 Based on stock selection relative to group return and ending weight relative to S&P 500 Index.
*Indicates stock not held as of 28 February 2015. 3 Based on combining the positions of both Google share classes (GOOGL and GOOG) which are listed in the S&P 500. Source: Wilshire. The
companies/securities above are shown for illustrative purposes only. Their inclusion should not be interpreted as a recommendation to buy or sell. J.P. Morgan Asset Management may or may not hold
positions on behalf of its clients in any or all of the aforementioned securities. Attributions may not match official returns due to differences in systems rounding.
26 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
JPMorgan Investment Funds - US Select Equity Fund:
Portfolio at a glance
As at 28 February 2015
Top 5 overweights1
% of portfolio by quintile
73% vs. 38%
60%
50%
S&P 500
50%
40%
20%
23%
22%
20% 18%
18%
10%
17%
15%
8%
9%
1%
1%
0%
Q1
Q2
Relative
position (%)
Stock
Fund
30%
Top 5 underweights1
Q3
Q4
Q5
Other
Relative
position (%)
Stock
Avago Technologies
1.7
Berkshire Hathaway*
-1.4
Honeywell International
1.6
General Electric*
-1.4
Occidental Petroleum
1.6
Exxon Mobil
-1.3
Lowe's
1.5
JPMorgan Chase2
-1.2
General Motors
1.5
AT&T*
-1.0
Sector over/underweights1
0.7%
0.6%
0.6%
0.4%
0.2%
0.1%
Overweight
1
TeleCommunications
Energy
Regionals
Basic Materials
Financial
Services
Media
Semi &
Hardware
Big Banks &
Brokers
Consumer
Cyclical
Software &
Services
Insurance
Health Services
& System
Auto &
Transportation
-0.3%
-1.0%
-1.1%
-1.4%
-1.6%
-1.9%
-2.3%
Consumer
Stable
1.0%
Industrial
Cyclical
1.0%
Utilities
1.1%
REITs
1.2%
Pharm/MedTech
1.3%
Retail
1.5%
Underweight
Reflects relative position to the S&P 500 Index. 2 Due to regulatory reasons, the portfolio is unable to hold JPMorgan Chase.*Indicates stocks not held in the portfolio as of 28 February 2015
Source: Wilshire. The companies/securities above are shown for illustrative purposes only. Their inclusion should not be interpreted as a recommendation to buy or sell. J.P. Morgan Asset Management
may or may not hold positions on behalf of its clients in any or all of the aforementioned securities.
27 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
JPMorgan Investment Funds - US Select Equity Fund:
Portfolio characteristics
As at 28 February 2015
Portfolio characteristics
Fund
S&P 500
USD 128.2b
USD 138.0b
Price / Earnings, 12-mth fwd1
16.7x
16.7x
Price / Free Cash Flow, last 12mth
17.3x
16.7x
17.3%
18.2%
1.6%
2.0%
10.5%
6.1%
Wgtd Avg Market Cap
Return on Equity, last 12-mth
Dividend Yield, current
EPS Growth, 12-mth fwd
Beta
1.07
Tracking Error
1.85
Holdings
163
Market capitalisation
Fund
100%
S&P 500
80%
78.1% 79.5%
60%
40%
15.8% 16.2%
20%
5.5% 3.9%
0.7% 0.5%
0%
Turnover, last 12-mth
67.1%
> USD 25 Bn USD 10 - 25 Bn USD 5 - 10 Bn
< USD 5 Bn
Source: Factset, J.P. Morgan Asset Management.
negatives. Past performance is not an indication of future performance. The targets and aims provided above are the Investment Manager’s targets and aims only and are not necessarily part
of the Fund’s investment objectives and policies as stated in the prospectus. There is no guarantee that these will be achieved.
1Includes
28 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
JPMorgan Funds – US Select Equity Plus Fund
29 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
US Select Equity Plus Fund seeks to increase potential alpha while increasing
investment efficiency
Better use of information
Greater diversification of stock bets
5%
4%
3%
2%
1%
0%
-1%
-2%
-3%
-4%
-5%
250
250
200
150
150
100
50
0
Q1
Q2
Q3
Q4
Greater capital committed to insights
Long/short
Same net market exposure
130%
140%
Long-only
Q5
120%
100%
100%
100%
Long-only
Long/short
100%
90%
80%
60%
40%
40%
-10%
20%
-30%
-60%
Long-only
0%
Long/short
Source: J.P. Morgan Asset Management. There is no guarantee that the use of long and short positions will succeed in limiting the fund’s exposure to domestic stock market movements,
capitalization, sector swings or other risk factors. Investment in a portfolio involved in long and short selling may have higher portfolio turnover rates. This will likely result in additional tax
consequences. Short selling involves certain risks, including additional costs associated with covering short positions and a possibility of unlimited loss on certain short sale positions.
30 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
JPMorgan Funds - US Select Equity Plus Fund:
Performance Net of Fees
For the periods ended 28 February 2015
Three
Months
One
Year
Three
Years
Five
Years
Seven
Years
Since
Inception2
JPM US Select Plus Equity - A (perf) (acc) USD
4.05%
16.07%
18.11%
14.94%
9.04%
7.15%
S&P 500 Net1
2.16%
14.80%
17.25%
15.45%
8.42%
5.89%
Excess Return
1.89%
1.27%
0.86%
-0.51%
0.62%
1.26%
Morningstar Quartile
1 S&P
1
1
1
1
1
-
500 Net 30% withholding tax. 2 Fund inception date is 5 July 2007.
Fund performance is shown based on the NAV of the share class A in USD with income reinvested including ongoing charges, excluding entry and exit fees. Past performance is not an indication of
future performance.
Morningstar Rankings/Universe and Morningstar Percentile: © Morningstar. All Rights Reserved
Source: J.P. Morgan Asset Management, Morningstar.
31 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
The extension portfolio has added value over the long term
Large Cap Core 130/30 portfolio: Attribution of excess returns relative to S&P 500
Contribution to relative return (%)
Long-only portfolio
4.0%
3.7%
3.5%
2.0%
3.7%
3.7%
1.5%
1.4%
2.3%
2.3%
10 Years
Since inception*
0.7%
3.0%
2.5%
30/30 portfolio
2.3%
0.8%
1.5%
3.0%
1.0%
1.0%
0.2%
1.5%
0.5%
0.8%
0.0%
1 Year
3 Years
5 Years
Source: J.P. Morgan Asset Management. Inception of strategy is July 1, 2004. Figures are gross of fees on an annualized basis relative to the S&P 500.
The Fund is an actively managed portfolio, holdings, sector weights, allocations and leverage, as applicable are subject to change at the discretion of the Investment Manager without notice. Past
performance is not an indication of future performance.
32 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
JPMorgan Funds - US Select Equity Plus Fund:
One year performance attribution
For the one year period ending 31 January 2015
Stock attribution2
Positive Contributors
Attribution Summary
Long-only portfolio: +1.98%
Stock: +3.09%
Sector: -1.11%
Impact (%)
Negative Contributors
30/30 portfolio: +1.03%
Impact (%)
Avago Technologies
1.27
General Motors
-0.67
Time Warner
0.96
Fluor
-0.59
United Continental
0.56
Southwest Airlines*
-0.49
Lam Research
0.41
Qualcomm*
-0.37
UnitedHealth
0.31
Intel*
-0.36
Sector attribution (relative to S&P 500)
-0.4%
-0.4%
0.0%
-0.7%
Industrial
Cyclical
-0.1%
0.0%
Reits
-0.1%
0.0%
Utilities
0.0%
Consumer
Stable
0.0%
Telecommunica
tions
0.1%
Energy
0.1%
Financial
Services
0.1%
Regionals
0.1%
Consumer
Cyclical
0.1%
Retail
0.2%
Media
0.2%
Basic Materials
0.2%
Systems &
Network
Hardware
0.3%
Big Banks &
Brokers
0.3%
Autos &
Transportation
0.3%
Pharm/Medtech
0.3%
Insurance
0.4%
Software &
Services
0.7%
Health Services
& Systems
Semiconductors
1.3%
1 Please note the attribution summary is based on the gross excess returns of the fund. 2 Based on stock selection relative to group return and ending weight relative to S&P 500 Index. *Indicates
stock not held as of 28 February 2015.
Source: FactSet. The companies/securities above are shown for illustrative purposes only. Their inclusion should not be interpreted as a recommendation to buy or sell. J.P. Morgan Asset Management
may or may not hold positions on behalf of its clients in any or all of the aforementioned securities. Attributions may not match official returns due to differences in systems rounding.
33 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
Short positions in the portfolio remain broadly diversified across sectors
As at 31 January 2015
Long/Short position weights by sector
6%
4%
2.5%
2.3%
2%
1.3%
1.6%
0.7%
1.4% 1.2%
2.6% 2.1%
1.4%
2.1%
1.1%
0.0%
0%
-2%
-2.3% -2.3%
3.4%
-0.9% -0.7% -1.2% -1.1% -0.7% -0.9%
-4%
-1.7%
-0.5%
-1.4%
2.9%
1.6%
0.2%
1.0%
-1.3%
-1.5%
-1.3%
-3.1%
-3.9%
0.8%
1.7%
-0.7% -0.9%
-2.5%
-2.8%
-6%
Source: FactSet.
The Fund is an actively managed portfolio, holdings, sector weights, allocations and leverage, as applicable are subject to change at the discretion of the Investment Manager without notice.
34 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
Utilities
Telecommunications
Systems & Network
Hardware
Software & Services
Semiconductors
Retail
Reits
Regionals
Pharm/Medtech
Media
Insurance
Industrial Cyclical
Health Services & Systems
Financial Services
Energy
Consumer Stable
Consumer Cyclical
Big Banks & Brokers
Basic Materials
Autos & Transportation
-8%
JPMorgan Funds - US Select Equity Plus Fund:
Portfolio at a glance
As at 31 January 2015
Top 5 overweights1
Overall positioning:
132% long, 32% short
Top 5 underweights1
Relative
position (%)
Stock
Relative
position (%)
Stock
292
ACE
2.87
Industrial Cyclical
-1.15
- Long positions:
170
Honeywell
2.80
Telecommunications
-0.94
- Average long weight:
78bps
Occidental Petroleum
2.70
Semiconductors
-0.75
- Short positions:
122
General Motors
2.65
Health Services & Systems
-0.67
Avago Technologies
2.55
REITs
-0.66
Number of stocks:
- Average short weight:
-26bps
Sector over/underweights1
0.8%
0.5%
0.1%
Pharm/Medtech
Energy
Basic Materials
Media
Financial
Services
Consumer
Cyclical
Software &
Services
Health Services
& Systems
Big Banks &
Brokers
Insurance
Semiconductors
Autos &
Transportation
-0.1%
-0.4%
Overweight
1
-0.7%
-1.0%
-2.3%
-2.4%
-2.6%
-3.9%
-4.1%
Industrial
Cyclical
1.3%
Utilities
1.3%
Consumer
Stable
1.4%
Reits
1.8%
Systems &
Network
Hardware
1.8%
Retail
2.3%
Telecommunications
2.8%
Regionals
3.4%
Underweight
Reflects relative position to the S&P 500 Index. 2 Based on sector classification of the stock
Source: FactSet.
The Fund is an actively managed portfolio, holdings, sector weights, allocations and leverage, as applicable are subject to change at the discretion of the Investment Manager without notice.. J.P.
Morgan Asset Management may or may not positions on behalf of its clients in any or all of the aforementioned securities.
35 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
JPMorgan Funds - US Select Equity Plus Fund:
Portfolio characteristics
As at 31 January 2015
Portfolio characteristics
Wgtd Avg Market Cap
Fund
S&P 500
USD 123.3b
USD 129.5b
Price / Earnings, 12-mth fwd1
15.6x
15.8x
Price / Free Cash Flow, last 12mth
18.7x
17.2x
16.3%
18.4%
1.5%
2.1%
13.1%
6.7%
1.10
N/A
2.89
N/A
138%
N/A
Return on Equity, last 12-mth
Dividend Yield, current
EPS Growth, 12-mth fwd
Beta
Tracking Error
Turnover, last 12-mth
Market capitalisation
100%
80%
60%
40%
20%
0%
-20%
Fund
82.8% 78.6%
11.2% 16.6%
S&P 500
6.2% 4.2%
0.7%
-0.1%
< USD 5 Bn
> USD 25 Bn USD 10 - 25 Bn USD 5 - 10 Bn
% of portfolio by quintile
89% vs. 40%
80%
60%
Fund
S&P 500
57%
32%
40%
22%
20%
18%
19%
20%
17%
14%
5%
9%
0%
0%
-20%
Q1
Q2
Q3
Q4
-13%
Q5
Other
Source: FactSet, J.P. Morgan Asset Management.
negatives. Past performance is not an indication of future performance. The targets and aims provided above are the Investment Manager’s targets and aims only and are not necessarily part
of the Fund’s investment objectives and policies as stated in the prospectus. There is no guarantee that these will be achieved.
1Includes
36 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
Appendix
37 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
JPMorgan Investment Funds - US Select Equity Fund:
Performance Net of Fees
Calendar year returns
2014
2013
2012
2011
2010
2009
JPM US Select Equity - A (acc) USD
13.26%
35.11%
13.82%
-3.01%
10.83%
33.29%
-37.39%
9.59%
S&P 500 Net1
12.99%
31.55%
15.22%
1.47%
14.37%
25.55%
-37.45%
4.95%
0.27%
3.56%
-1.40%
-4.48%
-3.54%
7.74%
0.06%
4.64%
Excess Return
1 S&P
2008
2007
500 Net 30% withholding tax. 2 Large Cap Core team assumed management 1 March 2006.
Performance over one year is annualized. Inception date of the fund is 31 July 1984.
Fund performance is shown based on the NAV of the share class A in USD with income reinvested including ongoing charges, excluding entry and exit fees. Past performance is not an indication of
future performance.
Source: J.P. Morgan Asset Management.
38 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
JPMorgan Funds - US Select Equity Plus Fund:
Performance Net of Fees
Calendar year returns
1
2014
2013
2012
2011
2010
2009
2008
JPM US Select Plus Equity - A (perf) (acc) USD
15.13%
36.46%
14.53%
-4.46%
11.43%
36.59%
-37.48%
S&P 500 Net1
12.99%
31.55%
15.22%
1.47%
14.37%
25.55%
-37.45%
Excess Return
2.14%
4.91%
-0.68%
-5.93%
-2.94%
11.04%
-0.03%
S&P 500 Net 30% withholding tax. Fund inception date is 5 July 2007.
Fund performance is shown based on the NAV of the share class A in USD with income reinvested including ongoing charges, excluding entry and exit fees. Past performance is not an indication of
future performance.
Source: J.P. Morgan Asset Management.
39 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
The U.S. Large Cap Core Equity Team
Paul Quinsee
Fundamental
Research
Quantitative
Research
D. Oels
H. Skibeli
K. Herr
N. Bhambhani
R. Bowman
J. Brown
C. Ceraso
K. Erickson
G. Fowlkes
T. Gamache
L. Huang
J. Liu
S. Kachhy
D. Karydas
J. Ko
N. Kumar
M. Leskinen
D. Maccarrone
M. Marolo
L. McGrath
D. Pasquale
M. Rand
L. Rich
L. Sadioglu
C. Silberstein
J. Shatney
D. Small
K. Stack
L. Vincent
R. Vineyard
U. Wompa
S. Wharton
Quantitative
Research
Y. Chen
C. Cheng
D. Jiang
L. Kang
Disciplined
Equity
Active
Portfolio
Management
R. Zingone
S. Lee
A. Glatter
T. Snyder
T. Luddy
S. Bao
S. Davis
Investment Assts
E. Berman
S. Santangelo
A. Thompson
Investment Assts
K. Chaudhary
T. Che
B. Daly
D. Hines
J. Huang
D. Nataloni
V. Perfanov
Research Assts
C. Adams
E. Alderman
L. Bradshaw
N. Chhabra
K. Chou
B. Gdula
C. Hogan
G. Liu
V. Perfanov
C. Revol
L. Unrein
S. Yee
H. Zhang
Client
Portfolio
Management
L. Spelman
E. Cohen
M. Connolly
J. Connors
J. Feuerman
F. Germana
J. Piccard
K. Saunders
J. Sherman
D. Stewart
W. Wong
L. Zahorec
C. Preussner*
N. Brandt*
F. Harris*
J. Wu*
M. Faherty*
C. Mariani*
Investment Assts
N. Cangialosi
R. Elkin
M. Gold
J. Reddick
J. Steinhardt
Z. Venditto
Business
Management
J. Barnett
K. Coyle
D. Gurak
S. Holmes
D. Morgan
A. Rivera
D. Summers
J. Villanueva
Trading**
C. Engler
M. Burns
J. Ho
J. Kuo
M. Louka
F. Mason
B. Petrovich
K. Portuondo
D. Schiff
E. Walsh
S. Woodruff
* London Office ** Trading desk reports to Kristian West, Global Head of Equity Trading
Names in bold report directly to Paul Quinsee.
There can be no assurance that the professionals currently employed by J.P. Morgan Asset Management will continue to be employed by J.P. Morgan Asset Management or that the past performance
or success of any such professional serves as an indicator of such professional’s future performance or success.
As of 31 December 2014
40 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
JPMorgan Investment Funds - US Select Equity Fund: Share Classes
Launch Date
ISIN
Bloomberg
Identifier
A - (acc) - EUR
10/06/2008
LU0218171717
JPMAUSS LX
35,000
A - (acc) - EUR (hedged)
15/03/2007
LU0157182857
JPUSSAH LX
35,000
A - (acc) - USD
05/07/1984
LU0070214290
JPMNAMA LX
35,000
A - (dist) - USD
15/05/2006
LU0247985343
JPMUSEA LX
35,000
B - (acc) - EUR
22/02/2012
LU0728016287
JPMUSBR LX
1,000,000
B - (acc) - USD
05/07/1984
LU0070214530
JPMNAMB LX
1,000,000
B - (dist) - USD
06/08/2013
LU0848066766
JPUSEBU LX
1,000,000
C - (acc) - EUR
06/09/2011
LU0672672143
JPMUSCE LX
10,000,000
C - (acc) - EUR (hedged)
19/09/2008
LU0294032106
JPMNNAD LX
10,000,000
C - (acc) - USD
03/02/1998
LU0087133087
JPMUSEC LX
10,000,000
C - (dist) - GBP
06/09/2011
LU0671461233
JPMUSCG LX
10,000,000
D - (acc) - EUR (hedged)
15/03/2007
LU0157183665
JPUSSDH LX
5,000
D - (acc) - USD
01/02/2002
LU0115097544
JPMUSED LX
5,000
I - (acc) - EUR (hedged)
11/10/2013
LU0973648859
JPUSIHA LX
10,000,000
I - (acc) - USD
15/05/2007
LU0248005711
JPUSSIU LX
10,000,000
I - (dist) - USD
11/10/2013
LU0973649071
JPUSELI LX
10,000,000
X** - (acc) - USD
06/04/1998
LU0085143211
JPMUSEX LX
Neg.
Share Class
*Minimum Subscriptions may vary depending on initial /subsequent subscriptions.**X Shares are only available on request. Fees and minimum subscriptions are negotiable.
Certain share classes may not be registered in this jurisdiction and certain share classes have eligibility criteria which must be met in order to invest.
Source: J.P. Morgan Asset Management as of 31 December 2014
41 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
Minimum
Subscription*
JPMorgan Investment Funds - US Select Equity Fund: Share Classes
Initial Charge
Annual
Management and
Advisory Fee
Distribution Fee
Operating and
Administrative
Expenses
Redemption
Charge
JPM US Select Equity A
5.00%
1.50%
Nil
0.40%
0.50%
JPM US Select Equity B
Nil
0.90%
Nil
0.25%
Nil
JPM US Select Equity C
Nil
0.65%
Nil
0.20%
Nil
JPM US Select Equity D
prior to 1 April 2015
5.00%
2.00%
Nil
0.40%
0.50%
JPM US Select Equity D
with effect from 1 April 2015
5.00%
1.50%
0.50%
0.40%
0.50%
JPM US Select Equity I
Nil
0.65%
Nil
0.16% Max
Nil
JPM US Select Equity X
Nil
Nil
Nil
0.15% Max
Nil
Share Class
As of 31 December 2014.
Certain share classes may not be registered in this jurisdiction and certain share classes have eligibility criteria which must be met in order to invest.
Source: J.P. Morgan Asset Management
42 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
JPMorgan Investment Funds - US Select Equity Fund:
Investment objective and risk profile

Investment Objective
–

To achieve a return in excess of the US equity market by investing primarily in US companies.
Risk Profile
–
The value of your investment may fall as well as rise and you may get back less than you originally invested.
–
The value of equity securities may go down as well as up in response to the performance of individual companies and general
market conditions.
–
The single market in which the Sub-Fund invests may be subject to particular political and economic risks and, as a result, the
Sub-Fund may be more volatile than more broadly diversified funds.
–
Movements in currency exchange rates can adversely affect the return of your investment. The currency hedging that may be
used to minimise the effect of currency fluctuations may not always be successful.
Please refer to the Fund's prospectus or Key Investor Information Document (KIID) for more information relating to the Fund.
43 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
JPMorgan Funds - US Select Equity Plus Fund: Share Classes
Share Class
A (perf) (acc) - EUR
A (perf) (acc) - EUR (hedged)
A (perf) (acc) - USD
A (perf) (dist) - GBP
A (perf) (dist) - USD
B (perf) (acc) - CHF (hedged)
B (perf) (acc) - USD
C (perf) (acc) - EUR (hedged)
C (perf) (acc) - USD
C (perf) (dist) - GBP
C (perf) (dist) - GBP (hedged)
C (perf) (dist) - USD
D (perf) (acc) - EUR (hedged)
D (perf) (acc) - USD
I (perf) (acc) - EUR (hedged)
I (perf) (acc) - USD
I (perf) (dist) - GBP
I (perf) (dist) - USD
X (perf) (acc) - USD
X (perf) (dist) - USD
Launch Date
ISIN
Bloomberg
Identifier
05/07/2007
05/07/2007
05/07/2007
01/04/2008
09/08/2007
27/10/2014
05/02/2008
23/05/2014
01/11/2007
26/09/2012
22/08/2011
26/09/2012
05/07/2007
05/07/2007
14/10/2013
06/10/2010
15/10/2013
14/10/2013
07/08/2007
10/10/2012
LU0281483569
LU0281482918
LU0292454872
LU0281483486
LU0281482678
LU1096710535
LU0281484021
LU0289216839
LU0281484617
LU0822049119
LU0644289422
LU0822049200
LU0281484963
LU0281484880
LU0973529505
LU0281485341
LU0973529760
LU0973529331
LU0281485770
LU0900194225
JPMSSAA LX
JPMSSHA LX
JPMUUSA LX
JPMUSXA LX
JPMUUDA LX
JPUSSBH LX
JPMUSAB LX
JPUSECH LX
JPMUSAC LX
JPMUCCS LX
JPMUCII LX
JPMUCCU LX
JPMSSHD LX
JPMUSUD LX
JPUSIHE LX
JPUSIAU LX
JPUSIGD LX
JPUSIUD LX
JPMUSAX LX
JPMUCXI LX
Minimum
Subscription*
35,000
35,000
35,000
35,000
35,000
1,000,000
1,000,000
10,000,000
10,000,000
10,000,000
10,000,000
10,000,000
5,000
5,000
10,000,000
10,000,000
10,000,000
10,000,000
Neg.
Neg.
Management
Fee(bps)
150
150
150
150
150
90
90
80
80
80
80
80
250
250
80
80
80
80
0
0
*Minimum Subscriptions may vary depending on initial /subsequent subscriptions. **X Shares are only available on request. Fees and minimum subscriptions are negotiable.
Certain share classes may not be registered in this jurisdiction and certain share classes have eligibility criteria which must be met in order to invest.
Source: J.P. Morgan Asset Management as at 31 December 2014.
44 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
Op & Admin
Expense(bps)
40
40
40
40
40
25
25
20
20
20
20
20
40
40
16 Max
16 Max
16 Max
16 Max
15 Max
15 Max
JPMorgan Funds - US Select Equity Plus Fund: Share Classes
Share Class
Initial
Charge
Annual Management and
Advisory Fee
Operating and Administrative
Expenses
Redemption Charge
JPM US Select Equity Plus A (perf)
5.00%
1.50%
0.40%
0.50%
JPM US Select Equity Plus B (perf)
Nil
0.90%
0.25%
Nil
JPM US Select Equity Plus C (perf)
Nil
0.80%
0.20%
Nil
JPM US Select Equity Plus D (perf)
5.00%
2.50%
0.40%
0.50%
JPM US Select Equity Plus I (perf)
Nil
0.80%
0.16% Max
Nil
JPM US Select Equity Plus P (perf)
5.00%
0.80% Max
0.20%
1.00%
JPM US Select Equity Plus X (perf)
Nil
Nil
0.15% Max
Nil
JPM US Select Equity Plus X
Nil
Nil
0.15% Max
Nil
Applicable Share Classes
Performance Fee
Mechanism
Performance Fee Benchmark
Non Hedged
10%
Claw-Back
S&P 500 Index (Total Return Net of 30% withholding tax)
CHF Hedged
10%
Claw-Back
S&P 500 Index (Total Return Net of 30% withholding tax) Hedged to EUR
EUR Hedged
10%
Claw-Back
S&P 500 Index (Total Return Net of 30% withholding tax) Hedged to EUR
GBP Hedged
10%
Claw-Back
S&P 500 Index (Total Return Net of 30% withholding tax) Hedged to GBP
**X Shares are only available on request. Fees and minimum subscriptions are negotiable.
Certain share classes may not be registered in this jurisdiction and certain share classes have eligibility criteria which must be met in order to invest.
Source: J.P. Morgan Asset Management as of 31 December 2014.
45 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
JPMorgan Funds - US Select Equity Plus Fund:
Investment objective and risk profile

Investment Objective
–

To provide long-term capital growth, through exposure to US companies by direct investment in securities of such companies
and through the use of financial derivative instruments.
Risk Profile
–
The value of your investment may fall as well as rise and you may get back less than you originally invested.
–
There is no guarantee that the use of long and short positions will succeed in enhancing investment returns.
–
The value of equity securities may go down as well as up in response to the performance of individual companies and general
market conditions.
–
The single market in which the Sub-Fund invests may be subject to particular political and economic risks, and as a result, the
Sub-Fund may be more volatile than more broadly diversified funds.
–
The value of financial derivative instruments can be volatile. This is because a small movement in the value of the underlying
asset can cause a large movement in the value of the financial derivative instrument and therefore, investment in such
instruments may result in losses in excess of the amount invested by the Sub-Fund.
–
The possible loss from taking a short position on a security may be unlimited as there is no restriction on the price to which a
security may rise. The short selling of investments may be subject to changes in regulations, which could adversely impact
returns to investors.
–
Movements in currency exchange rates can adversely affect the return of your investment. The currency hedging that may be
used to minimise the effect of currency fluctuations may not always be successful.
Please refer to the Fund's prospectus or Key Investor Information Document (KIID) for more information relating to the Fund.
46 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION
J.P. Morgan Asset Management
Contacts
Nadine Brandt, CAIA
Vice President, US Equity
Fiona Harris
Executive Director, US Equity
Christian Preussner, CFA
Managing Director, US Equity
 +44 (0) 20 7742 7217
 +353 91 871306
 +44 (0) 20 7742 2017
 [email protected]
 [email protected]
 [email protected]
For Professional Clients/Qualified Investors only - Not for Retail use or Distribution
This is a promotional document and as such the views contained herein are not to be taken as an advice or recommendation to buy or sell any investment or interest thereto. Reliance upon information
in this material is at the sole discretion of the reader. Any research in this document has been obtained and may have been acted upon by J.P. Morgan Asset Management for its own purpose. The
results of such research are being made available as additional information and do not necessarily reflect the views of J.P.Morgan Asset Management. Any forecasts, figures, opinions, statements of
financial market trends or investment techniques and strategies expressed are unless otherwise stated, J.P. Morgan Asset Management’s own at the date of this document. They are considered to be
reliable at the time of writing, may not necessarily be all-inclusive and are not guaranteed as to accuracy. They may be subject to change without reference or notification to you. It should be noted that
the value of investments and the income from them may fluctuate in accordance with market conditions and taxation agreements and investors may not get back the full amount invested. Changes in
exchange rates may have an adverse effect on the value, price or income of the product(s) or underlying overseas investments. Both past performance and yield may not be a reliable guide to future
performance. There is no guarantee that any forecast made will come to pass. Furthermore, whilst it is the intention to achieve the investment objective of the investment product(s), there can be no
assurance that those objectives will be met. J.P. Morgan Asset Management is the brand name for the asset management business of JPMorgan Chase & Co and its affiliates worldwide. You should
note that if you contact J.P. Morgan Asset Management by telephone those lines may be recorded and monitored for legal, security and training purposes. You should also take note that information
and data from communications with you will be collected, stored and processed by J.P. Morgan Asset Management in accordance with the EMEA Privacy Policy which can be accessed through the
following website http://www.jpmorgan.com/pages/privacy.
As the product may not be authorised or its offering may be restricted in your jurisdiction, it is the responsibility of every reader to satisfy himself as to the full observance of the laws and regulations of
the relevant jurisdiction. Prior to any application investors are advised to take all necessary legal, regulatory and tax advice on the consequences of an investment in the product(s). Shares or other
interests may not be offered to or purchased directly or indirectly by US persons. All transactions should be based on the latest available prospectus, the Key Investor Information Document (KIID) and
any applicable local offering document. These documents together with the annual report, semi-annual report and the articles of incorporation for the Luxembourg domiciled product(s) are available free
of charge upon request from JPMorgan Asset Management (Europe) S.à.r.l., European Bank & Business Centre, 6 route de Trèves, L-2633 Senningerberg, Grand Duchy of Luxembourg, your financial
adviser or your J.P. Morgan Asset Management regional contact. In Switzerland, J.P. Morgan (Suisse) SA, 8, rue de la Confédération, PO Box 5507, 1211 Geneva 11, Switzerland, has been authorised
by the Swiss Financial Market Supervisory Authority FINMA as Swiss representative and as paying agent of the funds, in Österreich JPMorgan Asset Management (Europe) S.à r.l., Austrian Branch,
Führichgasse 8, A-1010 Wien sowie der Zahl- u. Informationsstelle Uni Credit Bank AG, Schottengasse 6-8, A-1010 Wien.
Issued in Continental Europe by JPMorgan Asset Management (Europe) Société à responsabilité limitée, European Bank & Business Centre, 6 route de Trèves, L-2633 Senningerberg, Grand Duchy of
Luxembourg, R.C.S. Luxembourg B27900, corporate capital EUR 10.000.000.
Issued in the UK by JPMorgan Asset Management Marketing Limited which is authorised and regulated by the Financial Conduct Authority. Registered in England No. 288553. Registered address: 25
Bank St, Canary Wharf, London E14 5JP, United Kingdom.
Herausgeber in Österreich: JPMorgan Asset Management (Europe) S.à r.l., Austrian Branch, Führichgasse 8, A-1010 Wien.
47 | FOR PROFESSIONAL CLIENTS/QUALIFIED INVESTORS ONLY - NOT FOR RETAIL USE OR DISTRIBUTION