Active ETFs are still banned in Brazil. J.P. Morgan found a way in anyway.
This is part of The Rio Times’ daily coverage of Latin American markets and finance and Latin American financial news.
The asset manager is launching Brazilian Depositary Receipts of JEPI, its JPMorgan Equity Premium Income fund — the world’s largest actively managed ETF with $44 billion in assets. The BDR structure lets investors access the fund on the B3 exchange while the securities regulator, CVM, works on a rule change to formally permit active ETFs.
JEPI holds S&P 500 stocks — Alphabet, Amazon, Nvidia, Visa among them — and layers on options contracts to generate monthly income of 7 to 9 percent annually in dollars. Its 2025 volatility was 13.4 percent, roughly half the index. Total returns since its 2020 launch have averaged around 12 percent a year.
Initially available to qualified investors only, with retail access expected by year-end. Latin America CEO Giuliano De Marchi called it a potential watershed. The firm plans to bring its full lineup of over 100 active ETFs to Brazil.
The opportunity is structural. ETFs represent 1 percent of Brazil’s fund market — R$80 billion ($14 billion) — versus 30 percent in the United States. High rates keep capital in fixed income, and the absence of advisor rebates on exchange-traded products limits distribution.
J.P. Morgan is betting that a rate-cutting cycle and election-year volatility will push Brazilian investors toward global diversification. As global ETF head Travis Spence put it: 97 percent of the world’s fund opportunities sit outside Brazil. The gap is the trade.
For more context, read Brazil’s Morning Call and the Latin American Pulse.