The fixed-income market is likely heading toward the end of a three-decade long run and the U.S. equity market is pushing toward its tenth year in its current bull market. Investors should consider ways to diversify a bond and stock portfolio in an attempt to hedge against potential risks in an extended bullish environment.
On the upcoming webcast, Beyond Factor Fundamentals – Are You Ready to Zig if Traditional Assets Zag?, David M. Lebovitz, Global Market Strategist for J.P. Morgan Asset Management, Yasmin Dahya, Head of Americas Beta Specialist for J.P. Morgan Asset Management, and John Lunt, President of Lunt Capital Management, will delve into alternative investment strategies to help investors better understand investment options that may zig if traditional assets zag.
For example, the JPMorgan Diversified Alternatives ETF (NYSEArca: JPHF) combines various hedge fund-esque, alternative investment strategies in an easy-to-use ETF wrapper. Specifically, JPHF will include equity long/short, event driven and global macro based strategies.
The equity long/short strategy involves simultaneously taking equities that are attractive based on relevant return factors and selling equities that are unattractive based on relevant return factors. The long/short strategy will try to produce alpha through exploiting pricing inefficiencies between equity securities through long and short positions.
The event driven strategy will try to profit from companies on the basis that a specific event or catalyst will affect future pricing. For example, merger arbitrage strategies try to capitalize on price discrepancies and returns in corporate transactions.
Lastly, the global macro based strategy tries to exploit macro economic imbalances across the globe. The strategy may be implemented through a number of asset classes, including stocks, bonds, currencies and commodities.
JPHF includes 68.9% long and -47.9% short exposure to equity long/short; 52.4% long and -11.0% short exposure to the event driven theme; and 114.4% long and -140.72% short exposure to macro based strategies.
ETF investors can also individually target each of these hedge fund-esque strategies through focused ETF strategies, including d JPMorgan Managed Futures ETF (NYSEArca: JPMF), JPMorgan Long/Short ETF (JPLS) and JPMorgan Event Driven ETF (NYSEArca: JPED).
The managing advisors of JPHF will try to generate positive total returns over time while including a relatively low correlation to traditional markets, which helps smooth out a portfolio if the markets experience any unexpected turns ahead.
Financial advisors who are interested in learning more about alternative investment strategies can register for the Tuesday, March 20 webcast here.