JPMorgan Climate Change Solutions ETF (TEMP)

ETF JPMorgan Climate Change Solutions ETF (NYSEARCA: JKN) Overview

Profile: JKN is an actively managed ETF that invests in global companies positioned to benefit from the transition to a low-carbon economy. Its primary focus is on companies involved in renewable energy, energy efficiency, sustainable transportation, and climate adaptation solutions.

Objective: The ETF aims to achieve long-term capital appreciation by investing in companies that are actively contributing to the fight against climate change.

Issuer: JPMorgan Asset Management, a leading global asset manager with a strong reputation for its expertise in sustainable investing. The firm has a long history of managing responsible investment strategies and is a signatory to the UN Principles for Responsible Investment (PRI).

Market Share: JKN is a relatively new ETF, launched in December 2020. As of October 27, 2023, it has a market share of approximately 0.2% within the Climate Change ETF category.

Total Net Assets: As of October 27, 2023, JKN has total net assets of approximately $1.2 billion.

Moat: JKN's competitive advantages include:

• Active Management: JKN's active management approach allows the portfolio managers to select the most promising companies positioned to benefit from the climate change theme.
• Global Reach: The ETF invests in companies across the globe, providing diversification and exposure to opportunities beyond individual markets.
• Experienced Management Team: The portfolio managers have extensive experience in sustainable investing and a proven track record of success.

Financial Performance: JKN has a relatively short track record, but it has outperformed its benchmark, the MSCI World Climate Change Index, since its inception. As of October 27, 2023, JKN has a one-year return of 12.5%, compared to 9.8% for its benchmark.

Growth Trajectory: The global market for climate change solutions is expected to grow significantly in the coming years, driven by increasing government regulations, corporate sustainability initiatives, and technological advancements. This provides a strong tailwind for JKN's growth potential.

Liquidity: JKN has an average daily trading volume of approximately 100,000 shares, indicating good liquidity. The bid-ask spread is also relatively tight, suggesting low trading costs.

Market Dynamics: Several factors influence the market environment for JKN, including:

• Government Policies: Government policies and regulations related to climate change can significantly impact the demand for sustainable solutions.
• Technological Advancements: Advancements in clean energy technologies can create new investment opportunities.
• Investor Sentiment: Investor sentiment towards sustainable investing can influence the demand for climate-focused ETFs.

Competitors: Key competitors of JKN include:

• iShares Global Clean Energy ETF (ICLN) - Market share: 15.5%
• Invesco Global Clean Energy ETF (PBD) - Market share: 7.8%
• VanEck Low Carbon ESG ETF (ESMG) - Market share: 2.3%

Expense Ratio: JKN has an expense ratio of 0.45%, which is slightly higher than the average for climate change ETFs.

Investment Approach and Strategy: JKN employs an active management approach and invests in a diversified portfolio of approximately 100 companies across various sectors related to climate change solutions. The ETF focuses on companies with strong fundamentals, attractive growth prospects, and a commitment to environmental sustainability.

Key Points:

• Actively managed ETF focused on climate change solutions.
• Invests in global companies with strong growth potential.
• Outperformed its benchmark since inception.
• Good liquidity and tight bid-ask spread.
• Moderately high expense ratio.

Risks:

• Volatility: JKN's performance can be volatile due to the dynamic nature of the climate change sector.
• Market Risk: The ETF is exposed to risks associated with the underlying companies and the overall market.
• Regulatory Risk: Changes in government policies and regulations could impact the demand for climate change solutions.

Who Should Consider Investing: JKN is suitable for investors seeking long-term capital appreciation through exposure to companies contributing to the fight against climate change. This ETF is ideal for investors with a long-term investment horizon and a tolerance for moderate volatility.

Fundamental Rating Based on AI: 8/10

JKN receives a high rating based on its strong fundamentals, including its experienced management team, active management approach, and focus on a high-growth sector. However, the higher expense ratio and relatively short track record slightly lower the overall rating.

Resources and Disclaimers:

The information provided in this analysis is based on data available as of October 27, 2023. It is important to note that the ETF market is dynamic, and the data may change over time. It is recommended to conduct further research and consult with a financial advisor before making any investment decisions.

Sources:

• JKN website: https://www.jpmorganam.com/us/en/asset-management/etf/jpmorgan-climate-change-solutions-etf
• Morningstar: https://www.morningstar.com/etfs/arcx/jkn/performance
• ETF.com: https://www.etf.com/etfanalytics/etf-profile/JKN

Disclaimer: This is not financial advice. Please consult with a qualified financial advisor before making any investment decisions.