Summary Prospectus July
1, 2024
| JPMorgan BetaBuilders USD Investment Grade
Corporate Bond ETF Ticker: BBCB |
Before you invest, you may want to review the Fund’s Prospectus, which contains more
information about the Fund and its risks. You can find the Fund’s Prospectus and other information about the Fund, including the Statement of
Additional Information, online at www.jpmorganfunds.com/funddocuments. You can also get this information at no cost by calling 1-844-457-6383 or by sending an e-mail request to jpm.xf@jpmorgan.com or by
asking any financial intermediary that offers shares of the Fund. The Fund’s Prospectus and Statement of Additional Information, both dated July 1,
2024, as may be supplemented from time to time are incorporated by reference into this Summary Prospectus.
What is the goal of
the Fund?
The Fund seeks investment results that closely correspond, before fees and expenses, to the performance of the Bloomberg US Corporate Bond Index.
Fees and Expenses of the Fund
The following table describes the fees and expenses that you may pay if you buy, hold and sell Shares of the Fund. You may pay other fees, such as brokerage commissions
and other fees to financial intermediaries, which are not reflected in the table and example
below.
| ANNUAL FUND OPERATING EXPENSES1
(Expenses that you pay each year as a percentage of the
value of your investment) |
|
| Management Fees
|
0.09% |
| Total Annual Fund Operating Expenses |
0.09 |
1
The Fund's management agreement provides that the adviser will pay substantially all expenses of the Fund
(including expenses of the Trust relating to the Fund), except for the management fees, payments under the Fund’s 12b-1 plan (if any), interest expenses, dividend and interest expenses related to short sales,
taxes, acquired fund fees and expenses (other than fees for funds advised by the adviser and/or its affiliates), costs of holding shareholder meetings, and litigation and potential litigation and other extraordinary expenses not incurred in
the ordinary course of the Fund’s business. Additionally, the Fund shall be responsible for its non-operating expenses, including brokerage commissions and fees and expenses associated with the Fund’s securities
lending program, if applicable.
Example
This Example
is intended to help you compare the cost of investing in the Fund with the cost of investing in other funds. The Example does not take into account brokerage commissions that you pay when purchasing or selling Shares of the
Fund. The Example assumes that you invest $10,000 in the Fund for the time periods indicated. The
Example also assumes that your investment has a 5% return each year and that the Fund’s
operating expenses remain the same. Your actual costs may be higher or lower.
| WHETHER OR NOT YOU SELL YOUR SHARES, YOUR COST
WOULD BE: | ||||
| |
1 Year |
3 Years |
5 Years |
10 Years |
| SHARES ($) |
9 |
29 |
51 |
115 |
Portfolio Turnover
The
Fund pays transaction costs, such as commissions, when it buys and sells securities (or “turns over” its portfolio). A higher portfolio turnover rate may indicate higher transaction costs and may result in higher taxes when Shares are
held in a taxable account. These costs, which are not reflected in annual fund operating expenses
or in the Example, affect the Fund’s performance. During the Fund’s most recent fiscal year, the Fund’s portfolio turnover rate was 13% of the average value of its portfolio.
What are the Fund’s main investment strategies?
The Fund seeks investment results that closely correspond, before fees and expenses, to the performance of the Bloomberg US Corporate Bond Index (the Underlying Index),
which measures the investment grade, fixed-rate, taxable corporate bond market and includes USD
denominated securities publicly issued by US and non-US industrial, utility and financial issuers.
Bloomberg Index Services Limited is the index provider for the Underlying Index (the Index
Provider). The Fund will invest at least 80% of its Assets in securities included in the Underlying
Index. “Assets” means net assets, plus the amount of borrowings for investment
purposes. The Fund will provide shareholders with at least 60 days prior notice of any change to this policy. The Underlying Index is market capitalization weighted and is designed to measure the performance of U.S.
dollar denominated investment grade corporate debt publicly issued in the U.S. domestic market.
The Underlying Index is a component of the Bloomberg US Credit and Bloomberg US Aggregate
indices. As of May 31, 2024, the duration of the Underlying Index was 6.85 years.
As part of its principal strategy, the Fund invests in corporate bonds structured as corporate debt
securities, debt securities of master limited partnerships (MLPs), public or private placements,
restricted securities and other unregistered securities.
1
The Fund, using a
“passive” or indexing investment approach, attempts to closely correspond to the performance of the Underlying Index. Unlike many actively-managed funds, the Fund does not seek to outperform the Underlying
Index and does not seek temporary defensive positions when markets decline or appear
overvalued.
The Fund intends to utilize a “representative sampling” strategy whereby securities are chosen in order to attempt to approximate the investment characteristics of the
constituent securities. Targeted investment characteristics of the collective portfolio include
asset class exposure, industry weightings, liquidity, and other fixed income specific attributes (such as yield, duration, credit quality, spread and maturity). Even when the Fund utilizes representative sampling, it
must still invest at least 80% of its Assets in securities included in the Underlying Index. The
Fund’s portfolio will be rebalanced monthly in accordance with the rebalancing of the Underlying Index.
The Fund will not invest more than 25% of the value of its total assets in the securities of companies conducting their principal business activities in the same industry,
except that, to the extent that an industry represents 20% or more of the Fund’s Underlying
Index at the time of investment, the Fund may invest up to 35% of its total assets in that industry.
The Fund may invest in U.S. dollar-denominated securities of foreign issuers.
In addition to direct
investments in securities, derivatives, which are instruments that have a value based on another instrument, exchange rate or index, may be used as substitutes for securities in which the Fund can invest. The Fund may
use futures contracts as tools in the management of portfolio assets. The Fund may use
derivatives to hedge various investments, for risk management and/or to increase income or gain to the Fund. In particular, the Fund may invest in futures to manage duration.
The Fund will not invest in asset classes that are not present in the Underlying Index.
The
Fund’s Main Investment Risks
The Fund is subject to management risk and may not achieve its
objective if the adviser’s expectations regarding particular instruments or markets are not
met.
The Fund is subject to the main risks noted
below, any of which may adversely affect the Fund’s net asset value (NAV), market price,
performance and ability to meet its investment objective.
General Market Risk. Economies and financial markets throughout the world are becoming increasingly interconnected, which increases the likelihood that events or conditions in one country or region will adversely impact
markets or issuers in other countries or regions. Securities in the Underlying Index or in the
Fund’s portfolio may underperform in comparison to securities in general financial markets, a particular financial
market or other asset classes due to a
number of factors, including inflation (or expectations for inflation), deflation (or
expectations for deflation), interest rates, global demand for particular products or resources,
market instability, financial system instability, debt crises and downgrades, embargoes, tariffs,
sanctions and other trade barriers, regulatory events, other governmental trade or market control programs and related geopolitical events. In addition, the value of the Fund’s investments may be negatively affected
by the occurrence of global events such as war, terrorism, environmental disasters, natural
disasters or events, country instability, and infectious disease epidemics or pandemics.
Index Related Risk. The Fund’s return may not track the return of the Underlying Index for a number of reasons and therefore may not achieve its investment objective. For
example, the Fund incurs a number of operating expenses not applicable to the Underlying Index,
and incurs costs in buying and selling securities, especially when rebalancing the Fund’s securities holdings to reflect changes in the composition of the Underlying Index. In addition, the Fund’s return may differ
from the return of the Underlying Index as a result of, among other things, pricing differences
between the valuation of securities in the Underlying Index and in the Fund’s NAV and the inability to purchase certain securities included in the Underlying Index due to regulatory or other restrictions.
In addition, because the Fund uses a representative sampling approach, the Fund may not be as well correlated with the return of the Underlying Index as when the Fund
purchases all of the securities in the Underlying Index in the proportions in which they are
represented in the Underlying Index.
Errors in the construction or calculation of the Underlying Index
may occur from time to time. Any such errors may not be identified and corrected by the Index
Provider for some period of time, which may have an adverse impact on the Fund and its
shareholders.
The risk that
the Fund may not track the performance of the Underlying Index may be heightened during times of increased market volatility or other unusual market conditions.
Passive Management Risk. Unlike many investment companies, the Fund is not “actively” managed. Therefore, it would not generally sell a security because the
security’s issuer was in financial trouble unless that security is removed from the
Underlying Index. As a result, the Fund’s performance could be lower than funds that
actively shift their portfolio assets to take advantage of market opportunities or lessen the impact of a market decline or a decline in the value of one or more issuers. The Fund will not take defensive positions
under any market conditions, including in declining markets.
Sampling Risk. To the extent the Fund uses a representative sampling approach, it will hold a smaller number of securities than are in the Underlying Index. As a result,
an adverse development respecting an issuer of securities held by the Fund could result in a
greater decline in the Fund’s NAV than would be the case if the Fund held all of the securities in the Underlying Index. Conversely, a positive development relating to an issuer of securities in the Underlying Index that is
not held by the Fund could cause the Fund to underperform the Underlying Index. To the extent the
assets in the Fund are smaller, these risks may be greater.
2
Interest Rate
Risk. The Fund’s investments in bonds and other debt securities will change in value based
on changes in interest rates. If rates rise, the value of these investments generally declines.
Securities with greater interest rate sensitivity and longer maturities generally are subject to greater fluctuations in value. The Fund may face a heightened level of interest rate risk due to certain changes in monetary policy.
It is difficult to predict the pace at which central banks or monetary authorities may change
interest rates or the timing, frequency, or magnitude of such changes. Any such changes could be sudden and could expose debt markets to significant volatility and reduced liquidity for Fund
investments.
Credit Risk. The Fund’s investments are subject to the risk that issuers and/or counterparties will fail to make
payments when due or default completely. If an issuer’s or counterparty’s financial
condition worsens, the credit quality of the issuer or counterparty may deteriorate, making it difficult for the Fund to sell such investments.
Foreign Securities
Risk. Investments in foreign currencies and foreign issuers are subject to additional risks,
including political and economic risks, civil conflicts and war, greater volatility,
expropriation and nationalization risks, sanctions or other measures by the United States or
other governments, currency fluctuations, higher transaction costs, delayed settlement, possible
foreign controls on investment, liquidity risks, and less stringent investor protection and disclosure standards of foreign markets. In certain markets where securities and other instruments are not traded “delivery versus
payment,” the Fund may not receive timely payment for securities or other instruments it
has delivered or receive delivery of securities paid for and may be subject to increased risk
that the counterparty will fail to make payments or delivery when due or default completely.
Geographic Focus Risk. The Fund may focus its investments in one or more regions or small groups of countries. As a result, the Fund’s performance may be subject to
greater volatility than a more geographically diversified fund.
Prepayment Risk. The issuer of certain securities may repay principal in advance, especially when yields fall. Changes in the rate at which prepayments occur can affect
the return on investment of these securities. When debt obligations are prepaid or when
securities are called, the Fund may have to reinvest in securities with a lower yield. The Fund also may fail to recover additional amounts (i.e., premiums) paid for securities with higher coupons, resulting in an unexpected
capital loss.
Privately Placed Securities Risk. Privately placed securities generally are less liquid than publicly traded securities and the Fund may not always be able to sell such securities without experiencing delays in finding buyers or reducing
the sale price for such securities. The disposition of some of the securities held by the Fund
may be restricted under federal securities laws. As a result, the Fund may not be able to dispose of such investments at a time when, or at a price at which, it desires to do so and may have to bear expenses of
registering these securities, if necessary. These securities may also be difficult to
value.
Industry and Sector Focus Risk. At times, the Fund may increase the relative emphasis of its investments in a particular industry or sector. The prices of securities of issuers in a particular industry or sector may be more susceptible to
fluctuations due to changes in economic or business conditions, government regulations,
availability of basic resources or supplies, contagion
risk within a particular industry or sector or to other industries or sectors, or other events that affect
that industry or sector more than securities of issuers in other industries and sectors. To the
extent that the Fund increases the relative emphasis of its investments in a particular industry or sector, the value of the Fund’s Shares may fluctuate in response to events affecting that industry or sector.
Financials Sector
Risk. Financial services companies are subject to extensive governmental regulation which may
limit both the amounts and types of loans and other financial commitments they can make, the
interest rates and fees they can charge, the scope of their activities, the prices they can charge and the amount of capital they must maintain. Profitability is largely dependent on the availability and cost of
capital funds and can fluctuate significantly when interest rates change or due to increased
competition. In addition, deterioration of the credit markets generally may cause an adverse impact in a broad range of markets, including U.S. and international credit and interbank money markets generally, thereby
affecting a wide range of financial institutions and markets. Certain events in the financial
sector may cause an unusually high degree of volatility in the financial markets, both domestic and foreign, and cause certain financial services companies to incur large losses. Securities of financial services companies may
experience a dramatic decline in value when such companies experience substantial declines in the
valuations of their assets, take action to raise capital (such as the issuance of debt or equity securities), or cease operations. Credit losses resulting from financial difficulties of borrowers and financial losses
associated with investment activities can negatively impact the sector. Insurance companies may
be subject to severe price competition. Adverse economic, business or political developments could adversely affect financial institutions engaged in mortgage finance or other lending or investing activities directly or
indirectly connected to the value of real estate.
Foreign Issuer Risk. U.S. dollar-denominated securities of foreign issuers or U.S. affiliates of foreign issuers may be subject to additional risks not faced by domestic
issuers. These risks include political and economic risks, civil conflicts and war, greater
volatility, expropriation and nationalization risks, sanctions or other measures by the United States or other governments, and regulatory issues facing issuers in such foreign countries. Events and evolving conditions in certain
economies or markets may alter the risks associated with investments tied to countries or regions
that historically were perceived as comparatively stable becoming riskier and more volatile.
Concentration Risk. The Fund will not invest more than 25% of the value of its total assets in the securities of companies conducting their principal business activities in
the same industry, except that, to the extent that an industry represents 20% or more of the
Fund’s Underlying Index at the time of investment, the Fund may invest up to 35% of its assets in that industry. Concentrating Fund investments in companies conducting business in the same industry will subject
the Fund to a greater risk of loss as a result of adverse economic, business or other
developments affecting that industry than if its investments were not so concentrated.
MLP Risk. Debt securities of MLPs are subject to the risks of debt securities in general. For example, such securities are more sensitive to interest rates than equity interests
in MLPs. The managing general partner of an MLP may receive an incentive
3
allocation based on increases in the amount
and growth of cash distributions to investors in the MLP. This method of compensation may create
an incentive for the managing general partner to make investments that are riskier or more speculative than would be the case in the absence of such compensation arrangements. Certain MLPs may operate in, or have
exposure to, the energy sector. The energy sector can be significantly affected by changes in the
prices and supplies of oil and other energy fuels, energy conservation, the success of exploration
projects, and tax and other government regulations, policies of the Organization of Petroleum
Exporting Countries (OPEC) and relationships among OPEC members and between OPEC and oil
importing nations.
ETF Shares Trading Risk. Shares are listed for trading on the NYSE Arca, Inc. (the Exchange) and are bought and sold in the secondary market at market prices. The market
prices of Shares are expected to fluctuate, in some cases materially, in response to changes in
the Fund’s NAV, the intraday value of the Fund’s holdings and supply and demand for Shares. The adviser cannot predict whether Shares will trade above, below or at their NAV. Disruptions to creations and redemptions, the
existence of significant market volatility or potential lack of an active trading market for the
Shares (including through a trading halt), as well as other factors, may result in the Shares trading significantly above (at a premium) or below (at a discount) to NAV or to the intraday value of the Fund’s holdings.
During such periods, you may incur significant losses if you sell your Shares.
The securities held by the Fund may be traded in markets that close at a different time than the Exchange.
Liquidity in those securities may be reduced after the applicable closing times. Accordingly,
during the time when the Exchange is open but after the applicable market closing, fixing or settlement times, bid-ask spreads on the Exchange and the corresponding premium or discount to the Shares’ NAV may
widen.
Authorized Participant Concentration Risk. Only an authorized participant may engage in creation or redemption transactions directly with the Fund. The Fund has a limited number of intermediaries that act as authorized participants
and none of these authorized participants is or will be obligated to engage in creation or
redemption transactions. To the extent that these intermediaries exit the business or are unable to or choose not to proceed with creation and/or redemption orders with respect to the Fund and no other authorized participant
creates or redeems, Shares may trade at a discount to NAV and possibly face trading halts and/or
delisting.
Risk Associated with the Fund Holding Cash, Money Market Instruments and
Other Short-Term Investments. The Fund will, at times, hold assets in cash, money market
instruments and other short-term investments, which may hurt the Fund’s performance. These
positions may also subject the Fund to additional risks and costs.
You could lose money investing in the Fund.
The Fund’s Past
Performance
This section provides some indication of the risks of investing in the Fund. The bar chart shows the performance of the Fund’s Shares over the past five calendar years. The table shows the average annual total returns for the past one
year, five years and life of the Fund. It compares that performance to the Bloomberg US Corporate Bond Index. As of February 1, 2023, the Fund changed its investment strategies. In view
of these changes, the Fund’s performance record prior to this period might be less
pertinent for investors considering whether to purchase Shares of the Fund. Past performance
(before and after taxes) is not necessarily an indication of how the Fund will perform in the
future. Updated performance information is available by
visiting www.jpmorganfunds.com or by calling 1-844-457-6383 (844-4JPM ETF).
Source: Bloomberg Index Services Limited. BLOOMBERG® is a trademark and service mark of Bloomberg Finance L.P. and its affiliates
(collectively “Bloomberg”). Bloomberg or Bloomberg’s licensors own all proprietary rights in the Bloomberg Indices. Bloomberg does not approve or endorse this material, or guarantee the
accuracy or completeness of any information herein, or make any warranty, express or implied, as to the results to be obtained therefrom and, to the maximum extent allowed by law, shall
have any liability or responsibility for injury or damages arising in connection therewith.
| YEAR-BY-YEAR RETURNS |
| Best Quarter |
2nd quarter, 2020 |
8.59% |
| Worst Quarter |
1st quarter, 2022 |
-7.48% |
| The Fund’s year-to-date total return |
through |
3/31/24 |
was |
-0.43% |
. |
4
| AVERAGE ANNUAL TOTAL RETURNS
(For periods ended December 31, 2023) |
|||
| |
Past |
Past |
Life of Fund
since |
| |
1 Year |
5 Years |
12/12/2018 |
| SHARES |
|
|
|
| Return Before Taxes |
8.58 % |
2.45 % |
2.53 % |
| Return After Taxes on Distributions |
6.66 |
0.81 |
0.89 |
| Return After Taxes on Distributions and Sale of Fund Shares |
5.02 |
1.24 |
1.31 |
| BLOOMBERG U.S. CORPORATE INDEX (Reflects No Deduction for Fees, Expenses, or Taxes) |
8.52 |
2.63 |
2.73 |
After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on the investor’s tax situation and may differ from those shown, and the after-tax returns shown are not relevant to investors who hold their Shares through
tax-deferred arrangements such as 401(k) plans or individual retirement
accounts.
Management
J.P.
Morgan Investment Management Inc. (the adviser)
| Portfolio Manager |
Managed the
Fund Since |
Primary Title with Investment Adviser |
| Qiwei Zhu |
2021 |
Executive Director |
| Sameer Iqbal |
2023 |
Executive Director |
Purchase and Sale of Shares
Individual Shares of the Fund may only be purchased and sold in secondary market transactions through brokers
or financial intermediaries. Shares of the Fund are listed for trading on the
Exchange, and because Shares trade at
market prices rather than NAV, Shares of the Fund may trade at a price greater than NAV (premium)
or less than NAV (discount). Certain affiliates of the Fund and the adviser may purchase and resell Shares pursuant to this prospectus.
An investor may
incur costs attributable to the difference between the highest price a buyer is willing to pay to purchase Shares of the Fund (bid) and the lowest price a seller is willing to accept for Shares (ask) when buying or
selling Shares in the secondary market (the bid-ask spread).
Recent information, including information about the Fund’s NAV, market price, premiums and discounts,
and bid-ask spreads, is included on the Fund’s website at
jpmorganfunds.com.
Tax Information
To the
extent the Fund makes distributions, those distributions will be taxed as ordinary income or capital gains, except when your investment is in an IRA, 401(k) plan or other tax-advantaged investment plan, in which case you may be
subject to federal income tax upon withdrawal from the tax-advantaged investment
plan.
Payments to Broker-Dealers and Other Financial Intermediaries
If you
purchase Shares of the Fund through a broker-dealer or other financial intermediary (such as a bank), the adviser and its related companies may pay the financial intermediary for the sale of Shares and related services. These
payments may create a conflict of interest by influencing the broker-dealer or financial
intermediary and your salesperson to recommend the Fund over another investment. Ask your salesperson or visit your financial intermediary’s website for more information.
5
