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JP Morgan Global Allocation Fund (gaoax)

I Would Like The Pros & Cons About Purchasing This Fund.


  • Nothing really negative that I can see about this fund. It so happens I recently opened a position in RPGAX, TRP's global allocation offering. It's part of my move to increase my global/foreign exposure.
  • It seems to be pretty much in line with the usual suspects, CAIBX, MDLOX, SGENX, TIBIX.

    Slightly better performance, but looking at its portfolio, that could be explained by its slightly more aggressive stance. It's a bit more growthy than the others; allocation funds typically lean toward value.

    It also piles on the junk bonds with 1/4 BB, 1/4 B, 1/10 below B. That's similar to TIBIX (the other funds hold much higher rated bonds). But unlike TIBIX it uses a barbell strategy with 1/4 AAA-rated. (TIBIX has 1/3 in BBB, and little above that.)

    Counterbalancing the higher credit risk is a much reduced interest rate risk with a very low duration of 1.88 years, unlike the other funds.

    The only downside I see is the potential end of the fee waiver (0.24%, currently set to expire 2/28/18, but these are often extended indefinitely). On the plus side, it's significantly smaller than the funds above.

    BenWP's RPGAX is not a fund that one (or at least I) normally think of. But it may be the one closest to GAOSX. Similar growth leaning, similar average market cap, virtually identical std dev and Sharpe ratio. The bond side has a little less junk though still a lot, and is a little more evenly spread out in credit ratings, but still has a barbell feel. Much longer duration though. RPGAX has the lowest AUM of all the funds mentioned.
  • @ducrow: Among 489 World Allocation Funds, GAOAX is unranked. For your information, I'm linking U.S. News & World Report ranking of World Allocation Funds.
  • I like and use the fund. They try to maintain a typical 60/40 risk profile, but instead of piling into equities, they strategically use call options. Their move to purchase eurex and EM calls paid decently year to date. So did their decision to cut their currency hedging.

    For the full disclosure, i used to work with the PMs. But i use the fund for my family and clients due to its own merits.
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