JP Morgan Asset Management (JPMAM) has launched a long-only US equity fund labeled as an “alternative” product.

The US Hedged Equity Fund is for investors who want to maintain exposure to large American companies, but lower their US equity risk. These investors might include older people who need to own riskier assets later in life due to low interest rates, the firm said.

Using derivatives to provide protection against falling share prices, the strategy will seek returns from US companies with market-caps similar to those in the S&P 500, but with lower volatility than traditional funds in the sector.

The fund, which is regulated by the Ucits directive, hopes to recreate the success of the US-domiciled JPMorgan Hedged Equity Fund which was launched in December 2013 and had US$313 million (€295 million) in assets under management, as of November 30, 2016.

The same New York-based investment team runs both funds.

Hamilton Reiner, lead portfolio manager, said: “With several surprise upsets, most would agree 2016 has been a pretty unpredictable year and markets and investors are expecting more bumps in the road particularly during the first half of 2017. Political risk under the new Donald Trump administration will be closely watched by US equities investors.”

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