JPMorgan’s JGLO and JHLO ETFs Report No Derivative Exposure as of June 30, 2026

ASX Operating Rule 10A.3.1(e) Compliance: Mandatory Derivative Reporting

On 3 July 2026, JPMorgan Asset Management (Australia) Limited lodged an update covering the period ending 30 June 2026. This disclosure complies with the ASX Operating Rule 10A.3.1(e), which mandates active ETF managers to regularly report the notional derivative exposure of their funds relative to net asset value. This transparency measure helps investors understand the risk profile of active ETFs, especially since derivatives can amplify portfolio gains or losses and change effective market exposure beyond direct equity holdings.

JPMorgan Asset Management (Australia) Limited manages both ETFs, while Perpetual Trust Services Limited (ABN 48 000 142 049, AFSL 236648) acts as the issuer. This governance structure, with a specialist asset manager operating funds on behalf of a trustee, is standard within the Australian managed fund and ETF sector. The disclosure pertains to two products: JGLO, which is unhedged and offers exposure to global equities in local currencies, and JHLO, which is currency-hedged to mitigate foreign exchange impacts on Australian dollar returns.

JGLO Reports $6.59 Million NAV with No Derivative Overlay

The JPMorgan Global Select Equity Active ETF (JGLO) recorded a Fund Net Asset Value of $6,593,795.19 as at 30 June 2026. The fund reported zero notional listed derivative exposure and zero OTC derivative exposure excluding FX hedging, both representing 0.00% of NAV. This indicates that JGLO’s entire portfolio value was held in direct equity securities or equity-related instruments without any leveraged or synthetic derivative positions at the reporting date.

JGLO’s investment mandate, outlined in its Product Disclosure Statement (PDS), targets long-term capital appreciation by investing primarily in equities of companies in developed global markets, with the ability to invest in emerging markets as well. Typically, at least 80% of the fund’s assets are allocated to equity securities and related instruments. While derivatives may be used at other times, the current disclosure offers a monthly snapshot showing no derivative usage as of the end of June 2026.

JHLO’s $4.97 Million NAV and Currency Hedging Approach

The JPMorgan Global Select Equity (Hedged) Active ETF (JHLO) reported a Fund Net Asset Value of $4,966,729.84 as at 30 June 2026. Similar to JGLO, JHLO disclosed zero notional listed derivative exposure and zero OTC derivative exposure excluding FX hedging, both at 0.00% of NAV. It is important to highlight that derivatives used for currency hedging are excluded from this figure. As a hedged product, JHLO typically employs foreign exchange derivatives to offset currency fluctuations between the Australian dollar and the currencies of its underlying equity holdings.

The exclusion of FX hedging derivatives aligns with ASX Operating Rule 10A.3.1(e), which focuses on derivative exposure beyond currency management. For investors in JHLO, this means that while currency risk is actively managed through FX instruments, these do not add complexity or leverage to the equity exposure as reflected in the disclosed figures. The June 2026 report confirms that aside from FX hedging, JHLO held no other derivative positions.

Implications of Zero Derivative Exposure for Investors

Both JGLO and JHLO reporting 0.00% for notional listed and OTC derivative exposure (excluding FX hedging) indicates that neither fund was using derivatives to increase market exposure, implement tactical strategies, or hedge individual equity holdings as at 30 June 2026. For investors valuing transparency and simplicity, zero derivative exposure suggests returns should closely mirror the performance of the underlying equities without leverage or synthetic adjustments.

The company update clarifies that notional derivative exposure refers to the total market value of the securities underlying derivative contracts, distinct from any profit or loss on those contracts. This metric measures gross exposure, not net gains or losses, and should be considered accordingly when evaluating fund risk.

Shared Investment Objective: Long-Term Growth via Global Equities

JGLO and JHLO both pursue long-term capital appreciation by investing in an underlying fund focused on equity securities of companies in developed global markets, with some exposure to emerging markets. Normally, at least 80% of assets are held in equities or equity-related instruments, making these funds predominantly equity-focused with limited allocation to fixed income, cash, or alternatives.

The key difference lies in currency management: JGLO remains unhedged, exposing Australian investors to currency fluctuations, while JHLO hedges currency risk back to the Australian dollar, appealing to those seeking pure equity market exposure without foreign exchange variability. Both strategies suit different investor preferences depending on views about currency and portfolio diversification.

Regulatory Framework Governing JPMorgan’s Active ETFs

JPMorgan Asset Management (Australia) Limited (ABN 55 143 832 080, AFSL 376919) operates under Australian financial services licensing and complies with ASX conditions for active ETF managers. Unlike passive ETFs, active ETFs involve discretionary portfolio management, which can generate outperformance but requires enhanced disclosure to keep investors informed about derivative use and risk.

The monthly derivative exposure reports mandated by ASX Operating Rule 10A.3.1(e) provide transparency on whether fund managers introduce leverage or complexity beyond equity holdings. Consistent zero derivative exposure across reports would indicate a straightforward implementation of the global equity strategy for both JGLO and JHLO.

Fund Size and Scale Considerations

As of 30 June 2026, JGLO’s NAV stood at approximately $6.59 million and JHLO’s at about $4.97 million, combining for roughly $11.56 million. These sizes are relatively modest compared to many established ASX-listed ETFs. Fund size can impact liquidity, bid-ask spreads, and execution costs in global equity trading.

Smaller fund size does not necessarily imply poor performance or lack of investor interest; both funds may be in earlier growth phases, with NAV fluctuating due to market movements and investor flows. The update did not disclose unit holder numbers, performance details, or fund flows, so additional context would require reviewing the PDS, financial statements, or contacting JPMorgan Asset Management Australia directly at 1800 576 468.

Future Derivative Exposure Updates to Watch

Given the ongoing nature of ASX Operating Rule 10A.3.1(e), investors should expect continued monthly disclosures on derivative exposure. The next key report for July 2026 will reveal whether the zero-derivative stance persists or if either fund introduces listed or OTC derivatives.

Any future increase above 0.00% could indicate tactical overlays, hedging beyond FX, or shifts in portfolio strategy warranting investor attention. For now, the June 2026 data depict two actively managed global equity ETFs operating without derivative leverage or synthetic exposure aside from currency hedging. JPMorgan Asset Management encourages investors seeking more information to contact the manager directly.

Governance and Responsibilities of Issuer and Manager

This update is issued by JPMorgan Asset Management (Australia) Limited as fund manager on behalf of Perpetual Trust Services Limited, the issuer of JGLO and JHLO. This dual structure, combining a trustee or responsible entity with a specialist manager, is a common governance model in Australian managed investment schemes. Perpetual Trust Services Limited holds AFSL 236648 and ABN 48 000 142 049, providing regulatory oversight.

JPMorgan Asset Management includes a standard disclaimer stating the release is for general information only and does not constitute financial advice, recommendations, or an offer to buy or sell financial products. Investors considering JGLO or JHLO should review the relevant PDS and seek professional advice tailored to their financial situation. The disclosure’s immediate impact on share prices was unclear, as such derivative exposure reports are routine compliance filings rather than market-moving news.