(Alliance News) - JPMorgan US Smaller Cos Investment Trust PLC on Tuesday said net asset value in the first half of 2023 was up annually, but the trust underperformed against its benchmark.
The trust focuses on capital growth from investments in smaller US companies with a sustainable competitive advantage.
NAV per share on June 30 was 420.7 pence, up 6.7% from 394.1p a year prior. Compared 421.7p on December 31, it was down 0.2%.
"The company's NAV and share price performance during the period was negatively impacted by small cap stocks underperforming large cap stocks, and with higher interest rates and continued recession fears, it is possible that this trend will continue in the near term," Chair David Ross said.
JPMorgan US Smaller Cos said NAV total return in the first half was 0.4%, underperforming against its benchmark, the Russell 2000 index, which had a return of 2.1%.
The company declared no interim dividend, unchanged from a year prior.
Looking ahead, JPMorgan US Smaller Cos noted persistent inflation and stretched labour markets, but said that valuations of small caps versus large caps continued to look favourable, "especially with such a thin slice of the mega-cap technology names driving the overall market."
It added: "We are cognisant that the earnings picture for small caps is not poised for an immediate rebound and recent earnings revisions have been negative. However, the stocks will react positively before earnings hit bottom and our natural leaning towards high quality companies should provide downside protection in the interim. We expect that macro factors will continue to dominate investor focus in the short term but we believe our process can outperform over the cycle."
JPMorgan US Smaller Cos Investment Trust shares were 0.7% higher at 360.50 pence each on Tuesday morning in London.
By Tom Budszus, Alliance News reporter
Comments and questions to newsroom@alliancenews.com
Copyright 2023 Alliance News Ltd. All Rights Reserved.
Jpmorg.us (JUSC)