Summary Prospectus July
1, 2024
| JPMorgan Core Plus Bond ETF Ticker: JCPB |
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 a high level of current income by investing primarily in a diversified portfolio of high-, medium- and low-grade debt securities.
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
|
0.40% |
| Total Annual Fund Operating Expenses |
0.40 |
| Fee Waivers and/or Expense Reimbursements 2 |
-0.02 |
| Total Annual Fund Operating Expenses after Fee Waiv- ers and/or Expense Reimbursements 2 |
0.38 |
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.
2
The Fund’s adviser and/or its affiliates have contractually agreed to waive fees and/or reimburse expenses
to the extent Total Annual Fund Operating Expenses (excluding acquired fund fees and expenses other than certain money market fund fees as described below, dividend and interest expenses related to short sales, interest,
taxes, expenses related to litigation and potential litigation, costs of shareholder meetings, and extraordinary expenses) exceed 0.38% of the average daily net assets of the Fund. The Fund may invest in one or more money
market funds advised by the adviser or its affiliates (affiliated money market funds). The Fund’s adviser has contractually agreed to waive fees and/or reimburse expenses in an amount sufficient to offset the fees and
expenses of the affiliated money market funds incurred by the Fund because of the Fund’s investment in such money market funds. These waivers are in effect through 6/30/25, at which time it will be determined whether such waivers will be renewed or revised. To the extent that the Fund engages in securities lending, affiliated money market fund fees and expenses resulting
from the Fund’s investment of cash received from securities lending borrowers are not included in Total Annual Fund Operating Expenses and therefore, the above waivers do not apply to such investments.
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 $10,000 in the Fund for the time periods indicated. The
Example also assumes that your investment has a 5% return each year and that the Fund’s
operating expenses are equal to the total annual fund operating expenses after fee waivers and
expense reimbursements shown in the fee table through 6/30/25 and total annual fund operating
expenses thereafter. Your actual costs may be higher or lower.
| WHETHER OR NOT YOU SELL YOUR SHARES, YOUR COST
WOULD BE: | ||||
| |
1 Year |
3 Years |
5 Years |
10 Years |
| SHARES ($) |
39 |
126 |
222 |
503 |
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 57% of the average value of its portfolio.
What are the Fund’s main investment strategies?
As part of its main investment strategy, the Fund may principally invest in corporate bonds, U.S. treasury obligations and other U.S. government and agency
securities and asset-backed, mortgage-related and mortgage-backed securities. The Fund also may
invest in debt securities rated below investment grade (i.e., high yield or junk bonds) or the unrated equivalent, including from foreign and emerging markets.
As a matter of non-fundamental policy, the Fund will ordinarily invest at least 80% of its Assets in bonds.
For purposes of this policy, “Assets” means net assets plus the amount of borrowings
for investment purposes. The Fund will provide shareholders at least 60 days prior notice of any
change of this policy. The Fund’s average weighted maturity will ordinarily range between
five and twenty years. The Fund may have a longer or shorter
1
average weighted maturity under certain
market conditions and the Fund may shorten or lengthen its average weighted maturity if deemed
appropriate for temporary defensive purposes. Because of the Fund’s holdings in asset-backed,
mortgage-backed and similar securities, the Fund’s average weighted maturity is equivalent
to the average weighted maturity of the cash flows in the securities held by the Fund given
certain prepayment assumptions (also known as weighted average life).
The adviser will invest across the credit spectrum to provide the Fund exposure to various credit rating
categories. Under normal conditions, at least 70% of the Fund’s Assets will be invested in
securities that, at the time of purchase, are rated investment grade by a nationally recognized
statistical rating organization or in securities that are unrated but are deemed by the adviser
to be of comparable quality. The balance of the Fund’s Assets are not required to meet any
minimum quality rating although the Fund will not, under normal circumstances, invest more than
30% of its Assets in below investment grade securities (or the unrated equivalent). Such securities may include so called “distressed debt.” Distressed debt includes securities of issuers experiencing financial or
operating difficulties, securities where the issuer has defaulted in the payment of interest or principal or in the performance of its covenants or agreements, securities of issuers that may be involved in bankruptcy
proceedings, reorganizations or financial restructurings or securities of issuers operating in
troubled industries. As part of its principal investment strategy, the Fund may invest in debt securities structured as private placements, restricted securities and other unregistered securities.
The Fund may invest a significant portion of its Assets in mortgage-related and mortgage-backed securities at the adviser’s discretion. Mortgage-related and
mortgage-backed securities may be structured as collateralized mortgage obligations (agency and
non-agency), stripped mortgage-backed securities (interest-only or principal-only), commercial
mortgage-backed securities, mortgage pass-through securities and cash and cash equivalents. The
Fund expects to invest no more than 10% of its assets in “sub-prime” mortgage-related
securities at the time of purchase. The Fund may also enter into “dollar rolls” in
which the Fund sells mortgage-backed securities and at the same time contracts to buy back very similar securities on a future date.
Up to 25% of the
Fund’s Assets may be invested in foreign securities, including securities denominated in foreign currencies (some of which may be below investment grade securities). Foreign securities include securities issued by
foreign governments or their agencies and instrumentalities and companies that are incorporated
outside the United States, including securities from issuers in countries whose economies are less
developed (emerging markets), but do not include collateralized loan obligations (CLOs) that are
denominated in U.S. dollars. The Fund’s investments in below investment grade securities or the unrated equivalent including below investment grade foreign securities will not, under normal circumstances,
exceed more than 30% of the Fund’s Assets.
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 securi
ties in which the Fund can invest. The Fund
may use futures contracts, options, swaps and forward contracts as tools in the management of
portfolio assets.
The Fund may use derivatives to hedge various investments, for risk management, for efficient portfolio management and/ or to increase income or gain to the Fund. In
addition to the mortgage dollar rolls as described above, the Fund may utilize other relative
value strategies involving credit-oriented trades, combinations of derivatives, and combinations of derivatives and fixed income securities. The Fund may also utilize foreign currency derivatives such as currency forwards
to hedge its non-dollar investments back to the U.S. dollar or use such derivatives to gain or
adjust exposure to particular foreign securities, markets or currencies.
The Fund may use CPI-U swaps to hedge inflation risk associated with certain debt securities held by the Fund.
The Fund may invest in other ETFs in order to gain exposure to particular markets, including
foreign and emerging markets, or asset classes.
The adviser allocates the Fund’s assets among a range of sectors based on strategic positioning and
other tactical considerations. In buying and selling investments for the Fund, the adviser looks
for market sectors and securities that it believes will perform well over time. The adviser selects
individual securities after performing a risk/reward analysis that includes an evaluation of
interest rate risk, credit risk, currency risk, legal provisions and the structure of the transactions. As part of its investment process, the adviser seeks to assess the impact of environmental, social and governance
(ESG) factors on certain issuers or countries in the universe in which the Fund may invest. The
adviser’s assessment is based on an analysis of key opportunities and risks across industries to seek to identify financially material issues with respect to the Fund’s investments in issuers and ascertain key issues
that merit engagement with issuers. These assessments may not be conclusive and securities or
countries that may be negatively impacted by such factors may be purchased and retained by the Fund while the Fund may divest or not invest in securities that may be positively impacted by such factors.
As part of its principal investment strategy and for temporary defensive purposes, any portion of the Fund’s total assets may be invested in cash and cash equivalents,
including affiliated money market funds.
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.
2
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 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.
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 invest in variable and floating rate loans and other variable and floating rate
securities. Although these instruments are generally less sensitive to interest rate changes than
fixed rate instruments, the value of floating rate loans and other securities may decline if their interest rates do not rise as quickly, or as much, as general interest rates. 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.
Government Securities Risk. The Fund invests in securities issued or guaranteed by the U.S. government or its agencies and instrumentalities (such as securities issued by the Government National Mortgage Association (Ginnie Mae), the
Federal National Mortgage Association (Fannie Mae), or the Federal Home Loan Mortgage Corporation
(Freddie Mac)). U.S. government securities are subject to market risk, interest rate risk and
credit risk. Securities, such as those issued or guaranteed by Ginnie Mae or the U.S. Treasury,
that are backed by the full faith and credit of the United States, are guaranteed only as to the
timely payment of interest and principal when held to maturity and the market prices for such
securities will fluctuate. Notwithstanding that these securities are backed by the full faith and
credit of the United States, circumstances could arise that would prevent the payment of interest or principal. This would result in losses to the Fund. Securities issued or
guaranteed by U.S. government-related organizations, such as Fannie Mae and Freddie Mac, are not backed by the full faith and credit of the U.S. government and no
assurance can be given that the U.S. government will provide financial support. Therefore, U.S.
government-related organizations may not have the funds to meet their payment obligations in the future.
Foreign Securities and Emerging Markets Risk. Investments in foreign currencies and foreign issuers are subject to additional risks, including political and economic risks, unstable governments, civil conflicts and war, greater
volatility, decreased market liquidity, 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. Foreign market trading hours, clearance and settlement procedures, and holiday schedules may limit the Fund’s ability to buy and sell securities.
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. These risks are magnified in countries in “emerging markets.” Emerging market countries typically have less-established market economies than developed countries and may face greater
social, economic, regulatory and political uncertainties. In addition, emerging markets typically
present greater illiquidity and price volatility concerns due to smaller or limited local capital markets and greater difficulty in determining market valuations of securities due to limited public information on
issuers. Certain emerging market countries may be subject to less stringent requirements
regarding accounting, auditing, financial reporting and record keeping and therefore, material
information related to an investment may not be available or reliable. Additionally, the Fund may
have substantial difficulties exercising its legal rights or enforcing a counterparty’s legal obligations in certain jurisdictions outside of the United States, in particular in emerging market countries, which can increase the
risk of loss.
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.
Sovereign Debt Risk. The Fund may invest in securities issued or guaranteed by foreign governmental entities (known as sovereign debt securities). These investments are subject to the risk of payment delays or defaults, due, for
example, to cash flow problems, insufficient foreign currency reserves, political considerations,
large debt positions relative to the country’s economy or failure to implement economic reforms. There is no legal or bankruptcy process for collecting sovereign debt.
Currency Risk. Changes in foreign currency exchange rates will affect the value of the Fund’s securities and may affect the price of the Fund’s Shares.
Generally, when the value of the U.S. dollar rises in value relative to a foreign currency, an investment impacted by that currency loses value because that currency is
3
worth less in U.S. dollars. Currency
exchange rates may fluctuate significantly over short periods of time for a number of reasons,
including changes in interest rates. Devaluation of a currency by a country’s government or banking authority also will have a significant impact on the value of any investments denominated in that currency. Currency markets
generally are not as regulated as securities markets, may be riskier than other types of
investments and may increase the volatility of the Fund. Although currently the Fund anticipates at least 50% of the Fund’s net assets will be denominated in U.S. dollars or hedged back to U.S. dollars, the Fund has
the flexibility to have greater exposure to non-U.S. dollar investments. In addition, the
Fund’s use of foreign currency derivatives may not be successful, including due to delays
in placing trades and other operational limitations, in hedging non-dollar investments back to
the U.S. dollar and the use of such strategies may lower the Fund’s potential returns.
Asset-Backed, Mortgage-Related and Mortgage-Backed Securities Risk. The Fund may invest in asset-backed, mortgage-related and mortgage-backed securities including so-called
“sub-prime” mortgages that are subject to certain other risks including prepayment
and call risks. When mortgages and other obligations are prepaid and when securities are called, the Fund may have to reinvest in securities with a lower yield or fail to recover additional amounts (i.e., premiums) paid
for securities with higher interest rates, resulting in an unexpected capital loss and/or a
decrease in the amount of dividends and yield. In periods of either rising or declining interest rates, the Fund may be subject to extension risk, and may receive principal later than expected. As a result, in periods of rising
interest rates, the Fund may exhibit additional volatility. During periods of difficult or frozen
credit markets, significant changes in interest rates or deteriorating economic conditions, such securities may decline in value, face valuation difficulties, become more volatile and/or become illiquid. Additionally,
asset-backed, mortgage-related and mortgage-backed securities are subject to risks associated
with their structure and the nature of the assets underlying the securities and the servicing of
those assets. Certain asset-backed, mortgage-related and mortgage-backed securities may face
valuation difficulties and may be less liquid than other types of asset-backed, mortgage-related and mortgage-backed securities, or debt securities.
Collateralized mortgage obligations (CMOs) and stripped mortgage-backed securities, including those structured as interest-only (IOs) and principal-only (POs), are
more volatile and may be more sensitive to the rate of prepayment than other mortgage-related
securities. The risk of default, as described under “Credit Risk,” for “sub-prime” mortgages is generally higher than other types of mortgage-backed securities. The structure of some of these securities may be
complex and there may be less available information than other types of debt
securities.
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.
High Yield Securities and Loan Risk.
The Fund invests in instruments including junk bonds, Loans and instruments that are issued by
companies that are highly leveraged, less creditworthy or financially distressed. These investments are considered to be speculative and are subject to greater risk of loss, greater sensitivity to economic changes,
valuation difficulties and potential illiquidity. Such investments are subject to additional
risks including subordination to other creditors, no collateral or limited rights in collateral, lack of a regular trading market, extended settlement periods, liquidity risks, prepayment risks, potentially less protection under the
federal securities laws and lack of publicly available information. The Fund will not have direct
recourse against the issuer of a loan participation. Loans that are deemed to be liquid at the time of purchase may become illiquid.
In recent
years, there has been a broad trend of weaker or less restrictive covenant protections in both the Loan and high yield markets. Among other things, under such weaker or less restrictive covenants, borrowers might be able to
exercise more flexibility with respect to certain activities than borrowers who are subject to
stronger or more protective covenants. For example, borrowers might be able to incur more debt, including secured debt, return more capital to shareholders, remove or reduce assets that are designated as collateral securing
Loans or high yield securities, increase the claims against assets that are permitted against
collateral securing Loans or high yield securities or otherwise manage their business in ways that could impact creditors negatively. In addition, certain privately held borrowers might be permitted to file less
frequent, less detailed or less timely financial reporting or other information, which could
negatively impact the value of the Loans or high yield securities issued by such borrowers. Each of these factors might negatively impact the Loans and high yield instruments held by the Fund.
No active trading
market may exist for some of the instruments and certain investments may be subject to restrictions on resale. In addition, the settlement period for Loans is uncertain as there is no standardized settlement
schedule applicable to such investments. Certain Loans may take more than seven days to settle.
The inability to dispose of the Fund’s securities and other investments in a timely fashion could result in losses to the Fund. Because some instruments may have a more limited secondary market, liquidity and valuation risk is
more pronounced for the Fund than for funds that invest primarily in other types of fixed income
instruments or equity securities. When Loans and other instruments are prepaid, the Fund may have
to reinvest in instruments with a lower yield or fail to recover additional amounts (i.e., premiums) paid for these instruments, resulting in an unexpected capital loss and/or a decrease in the amount of dividends and yield.
Certain Loans may not be considered securities under the federal securities laws and, therefore,
investments in such Loans may not be subject to certain protections under those laws. In addition, the adviser may not have access to material non-public information to which other investors may have
access.
Derivatives Risk. Derivatives, including foreign forward currency contracts, options, futures contracts and swaps, may be
riskier than other types of investments and may increase the volatility of the Fund. Derivatives
may be sensitive to changes in economic and market conditions and may create leverage, which
could result in losses that significantly exceed the Fund’s original investment. Certain derivatives expose the Fund to
4
counter-party risk, which is the risk that
the derivative counterparty will not fulfill its contractual obligations (and includes credit
risk associated with the counterparty). Certain derivatives are synthetic instruments that attempt to replicate the performance of certain reference assets. With regard to such derivatives, the Fund does not have a claim
on the reference assets and is subject to enhanced counterparty risk. Derivatives may not perform
as expected, so the Fund may not realize the intended benefits. When used for hedging, the change
in value of a derivative may not correlate as expected with the currency, security or other risk being hedged. In addition, given their complexity, derivatives expose the Fund to risks of mispricing or improper valuation. Derivatives
also can expose the Fund to derivative liquidity risk, which includes risks involving the
liquidity demands that derivatives can create to make payments of margin, collateral, or settlement payments to counterparties, legal risk, which includes the risk of loss resulting from insufficient or unenforceable
contractual documentation, insufficient capacity or authority of the Fund’s counterparty
and operational risk, which includes documentation or settlement issues, system failures, inadequate controls and human error.
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.
Repurchase Agreement Risk. Repurchase agreements involve some risk to the Fund that the counterparty does not meet its obligation under the agreement.
ETF Shares Trading Risk. Shares are listed for trading on the Cboe BZX Exchange, 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.
Cash Transactions Risk. Unlike certain ETFs, the Fund may effect creations and redemptions in cash or partially in cash. Therefore, it may be required to sell portfolio
securities and subsequently recognize gains on such sales that the Fund might not have recognized
if it were to distribute portfolio securities in-kind. As such, investments in Shares may be less tax-efficient than an investment in an ETF that distributes portfolio securities entirely in-kind.
CPI-U Strategy Risk.
The Fund may use CPI-U swaps to hedge inflation risk associated with certain debt securities held by the Fund. There is no guarantee that such strategy will be effective in protecting the return from such securities
from inflation risks. In addition, CPI-U swaps are subject to “Derivatives Risk.”
ETF and Investment Company Risk. Shareholders bear both their proportionate share of the Fund’s expenses and similar expenses of an ETF or other investment company.
The price and movement of an index-based ETF may not track the underlying index and may result in
a loss. ETFs may trade at a price below their NAV (also known as a discount).
Mortgage Dollar Roll Risk. The Fund may enter into mortgage dollar rolls involving mortgage pass-through securities including mortgage TBAs and other mortgage-backed
securities. During the period between the sale and repurchase in a mortgage dollar roll
transaction, the Fund will not be entitled to receive interest and principal payments on the securities sold. Losses may arise due to changes in the value of the securities or if the counterparty does not perform under the terms of
the agreement. If the counterparty files for bankruptcy or becomes insolvent, the Fund’s
right to repurchase or sell securities may be limited. Short sales of mortgage TBAs and engaging in
mortgage dollar rolls may be subject to leverage risks as described under “Derivatives
Risk.” In addition, mortgage dollar
5
rolls may increase interest rate risk and
result in an increased portfolio turnover rate which increases costs and may increase taxable
gains.
Covenant Lite Loan Risk. The Fund may invest in, or obtain exposure to, Loans that are “covenant lite.” Covenants
contained in loan documentation are intended to protect lenders by imposing certain restrictions
and other limitations on a borrower’s operations or assets and by providing certain information and consent rights to lenders. Covenant lite loans may lack financial maintenance covenants that in certain
situations can allow lenders to claim a default on the loan to seek to protect the interests of
the lenders. The absence of financial maintenance covenants in a covenant lite loan might result in a lower recovery in the event of a default by the borrower. Covenant lite loans have become much more prevalent
in recent years.
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 four calendar years. The table shows the average annual total returns for the past one
year and life of the Fund. It compares that performance to the Bloomberg U.S. Aggregate Index. 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 |
4th quarter, 2023 |
6.94% |
| Worst Quarter |
1st quarter, 2022 |
-5.60% |
| The Fund’s year-to-date total return |
through |
3/31/24 |
was |
-0.13% |
. |
| AVERAGE ANNUAL TOTAL RETURNS
(For periods ended December 31, 2023) |
||
| |
Past |
Life of Fund
since |
| |
1 Year |
01/28/2019 |
| SHARES |
|
|
| Return Before Taxes |
7.04 % |
1.94 % |
| Return After Taxes on Distributions |
5.13 |
0.64 |
| Return After Taxes on Distributions and Sale of Fund Shares |
4.12 |
0.95 |
| BLOOMBERG U.S. AGGREGATE INDEX (Reflects No Deduction for Fees, Expenses, or Taxes) |
5.53 |
1.05 |
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 |
| Richard Figuly |
2019 |
Managing Director |
| J. Andrew Norelli |
2019 |
Managing Director |
| Lisa Coleman |
2020 |
Managing Director |
| Thomas Hauser |
2020 |
Managing Director |
| Kay Herr |
2023 |
Managing Director |
| Priya Misra |
2024 |
Managing Director |
6
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.
7
