RL360 Fund Merger - JPMorgan Global Bond Fund (USD)

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Fund Merger - JPMorgan Global Bond Fund (USD)

JPMorgan have announced that on the 29 November 2013 they will merge the JPMorgan Bond Fund (USD) into the JPMorgan Aggregate Bond Fund (USD).

Impacts on
this closed product

Why are they merging the funds? 

The merger was decided following a review of the fund range which identified considerable overlap between the investment strategy of the JPMorgan Bond Fund (USD) (the merging fund) and that of certain other aggregate bond funds within their range. 


Differences between the two funds 

Both funds invest primarily in global investment grade debt securities. The JPMorgan Bond Fund (USD) (merging fund) generally focuses on government debt securities and invests primarily in developed countries, whereas the JPMorgan Aggregate Bond Fund (USD) (receiving fund) primarily invests in corporate and government debt securities globally, including emerging markets. The receiving fund may invest a significant portion of its assets in agency mortgage-backed securities and covered bonds. 


The potential benefits: 

JPMorgan believe that consolidating a number of similar investment strategies into a single aggregate bond strategy will facilitate growth in the underlying assets. In addition, the merger aims to provide a simplified product range for investors that allows for more efficient use of fund management, operational and administrative resources by eliminating overlapping investment strategies. 


The potential drawbacks: 

Certain one-time expenses associated with the merger will be borne by the Global Bond Fund (USD). These include costs associated with trading and transferring the Global Bond Fund (USD) assets. 


From 2 days prior to the merger, i.e. 27 November 2013, JPMorgan will cease to accept subscriptions, switches or redemption of shares in the merging fund. 


Other considerations: 

As the merger date approaches, the USD Global Bond Fund may adjust its portfolio so that it resembles that of the receiving Aggregate Bond Fund (USD), however this rebalancing should not cause the Global Bond Fund (USD) to deviate from its investment policy. 


Charges of the receiving Aggregate Bond Fund (USD) will be the same or lower than the Global Bond Fund (USD). 


The Global Bond Fund (USD) will not bear any additional legal, advisory or administrative costs associated with the merger. 


Performance information for the Global Bond Fund (USD) and the receiving Aggregate Bond Fund (USD) can be found in the relevant KIID or factsheet which is available from the document library at www.jpmorganassetmanagement.com. 


Letters have been issued to affected policyholders, appointed investment advisers and their servicing agents advising them of the fund merger. The fund managers notification and sample letters can be viewed opposite.