Should JPMorgan Diversified Return U.S. Mid Cap Equity ETF (JPME) Be on Your Investing Radar?

Looking for broad exposure to the Mid Cap Blend segment of the US equity market? You should consider the JPMorgan Diversified Return U.S. Mid Cap Equity ETF (JPME), a passively managed exchange traded fund launched on 05/11/2016.

The fund is sponsored by J.P. Morgan. It has amassed assets over $358.77 million, making it one of the average sized ETFs attempting to match the Mid Cap Blend segment of the US equity market.

Why Mid Cap Blend

Mid cap companies have market capitalization between $2 billion and $10 billion. They usually have higher growth prospects than large cap companies and are less volatile than small cap companies. These types of companies, then, have a good balance of stability and growth potential.

Typically holding a combination of both growth and value stocks, blend ETFs also demonstrate qualities seen in value and growth investments.

Costs

Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.

Annual operating expenses for this ETF are 0.24%, putting it on par with most peer products in the space.

It has a 12-month trailing dividend yield of 2.08%.

Sector Exposure and Top Holdings

Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.

This ETF has heaviest allocation to the Healthcare sector--about 11.80% of the portfolio. Consumer Staples and Industrials round out the top three.

Looking at individual holdings, Tapestry Inc Common (TPR) accounts for about 0.57% of total assets, followed by Ugi Corp Common Stock (UGI) and Entergy Corp Common (ETR).

The top 10 holdings account for about 4.88% of total assets under management.

Performance and Risk

JPME seeks to match the performance of the Russell Midcap Diversified Factor Index before fees and expenses. The JP Morgan Diversified Factor US Mid Cap Equity Index utilizes a rules-based approach that combines risk-based portfolio construction with multi-factor security selection, including value, quality and momentum factors.

The ETF has lost about -9.06% so far this year and is down about -1.51% in the last one year (as of 04/11/2025). In the past 52-week period, it has traded between $89.28 and $110.92.

The ETF has a beta of 0.96 and standard deviation of 17.40% for the trailing three-year period. With about 356 holdings, it effectively diversifies company-specific risk.

Alternatives

JPMorgan Diversified Return U.S. Mid Cap Equity ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, JPME is a reasonable option for those seeking exposure to the Style Box - Mid Cap Blend area of the market. Investors might also want to consider some other ETF options in the space.

The Vanguard Mid-Cap ETF (VO) and the iShares Core S&P Mid-Cap ETF (IJH) track a similar index. While Vanguard Mid-Cap ETF has $67.32 billion in assets, iShares Core S&P Mid-Cap ETF has $81.22 billion. VO has an expense ratio of 0.04% and IJH charges 0.05%.

Bottom-Line

While an excellent vehicle for long term investors, passively managed ETFs are a popular choice among institutional and retail investors due to their low costs, transparency, flexibility, and tax efficiency.

To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.

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This article originally published on Zacks Investment Research (zacks.com).

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