UK fintech, Nutmeg, has partnered with J.P. Morgan Asset Management (NYSE:JPM) to launch a range of five risk-rated portfolios. The digital ‘Smart Alpha’ portfolio range will combine J.P Morgan Asset Management’s (JPMAM) expertise, with Nutmeg’s popular fintech interface – to “bring active security selection to the Nutmeg investment range”.
Run by JPMAM’s Multi-Asset Solutions team, the Smart Alpha portfolios will offer a globally diversified range of ETFs, with the aim of bringing together three sources of potential returns.
Run by the Multi-Asset Solutions team at JPMAM, the Smart Alpha portfolios offer a range of globally diversified exchange traded funds (ETFs) which seek to bring together three sources of potential return by way of:
Long-term, strategic asset allocation set by JPMAM Multi-Asset Solutions specialists; tactical allocations around this allocation, to optimise risks and opportunities at different stages of the market cycle; and smart security selection – with a mixture of passive and active equity ETFs.
Speaking on the latter, the companies’ statement read: “These active equity ETFs will seek to achieve returns in excess of their respective benchmarks through active overweights and underweights. The active element of the Smart Alpha portfolios will be ESG integrated, meaning environmental, social and governance considerations are factored into every research and investment decision.”
Commenting on the announcement, Nutmeg CIO, James McManus, said: “At Nutmeg, our mission has always been to open up the previously exclusive world of wealth management, by bringing innovative, technology-led solutions to more people in order to help them achieve their financial goals.”
“The Smart Alpha portfolio range sits at the intersection of passive and active management. It builds on our core investment principles and aims to deliver superior returns by giving customers the best of both worlds: a multi-asset portfolio that combines the diversification of a passive approach with active, ESG-integrated, research-driven security selection.”
J.P. Morgan Asset Management’s head of UK ETF distribution, Edward Malcom, added that the company are ‘delighted’ with the partnership, and alongside Nutmeg’s technology, the Smart Alpha portfolios will enhance customers’ investment opportunities.
Mr McManus concluded by saying that the Smart Alpha portfolios: “[Offer] a managed and dynamic approach to asset allocation, combined with a research led approach to security selection, seeking outperformance without the usual trade-offs in cost, diversification or transparency. In addition, the active equity ETFs in Smart Alpha promote sustainable business practices and exclude companies in sectors that many clients tell us they would like to avoid.”