HEART real estate assets such as real estate, infrastructure and transport are an attractive part of the market that has the potential to generate a reliable return based on income. The performance is largely uncorrelated with stocks and bonds, making it a useful diversifier for investors.
The £220m JPMorgan Global Core Real Assets investment trust provides exposure through holdings in a number of JPMorgan’s institutional real estate asset strategies focusing on infrastructure, real estate and transport. These underlying funds are large in size with established and mature portfolios, which are able to provide investors with predictable long-term cash flows that are difficult to access in public markets.
Many of the assets they own can increase their income over time based on inflation or due to their higher valuations. Another important feature is that much of the yield is contracted or regulated, so the overall performance of the trust should be relatively stable during times of economic stress.
To improve resilience, the portfolio was reallocated from more economically sensitive assets, such as airports and seaports, in favor of power and contracted utilities. These have strong cash flow generation and are supported by structural trends such as the transition to a more energy efficient society.
JPMorgan Global Real Assets share price