JPMorgan U.S. Equity Fund

Transcription

1 Prospectus J.P. Morgan U.S. Equity Funds Institutional Class Shares November 1, 2009 JPMorgan Disciplined Equity Fund JPMorgan Diversified Fund JPMorgan Mid Cap Value Fund JPMorgan Small Cap Growth Fund JPMorgan U.S. Equity Fund JPMorgan U.S. Small Company Fund JPMorgan Value Advantage Fund JPMorgan Value Opportunities Fund Ticker: JPIEX Ticker: JPDVX Ticker: FLMVX Ticker: JISGX Ticker: JMUEX Ticker: JUSSX Ticker: JVAIX Ticker: JVOIX The Securities and Exchange Commission has not approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.

2 CONTENTS Risk/Return Summaries: JPMorgan Disciplined Equity Fund... 1 JPMorgan Diversified Fund... 5 JPMorgan Mid Cap Value Fund... 9 JPMorgan Small Cap Growth Fund JPMorgan U.S. Equity Fund JPMorgan U.S. Small Company Fund JPMorgan Value Advantage Fund JPMorgan Value Opportunities Fund More About the Funds Additional Information about the Funds Investment Strategies Investment Risks Cash Positions The Funds Management and Administration How to Do Business with the Funds Purchasing Fund Shares Networking and Sub-Transfer Agency Fees Exchanging Fund Shares Redeeming Fund Shares Shareholder Information Distributions and Taxes Shareholder Statements and Reports Availability of Proxy Voting Record Portfolio Holdings Disclosure Risk and Reward Elements for the Funds Financial Highlights Legal Proceedings and Additional Fee and Expense Information How to Reach Us... Back cover

3 JPMorgan Disciplined Equity Fund Class/Ticker: Institutional/JPIEX What is the goal of the Fund? The Fund seeks to provide a consistently high total return from a broadly diversified portfolio of equity securities with risk characteristics similar to the Standard and Poor s 500 Composite Stock Price Index (S&P 500 Index). Fees and Expenses for Institutional Class Shares of the Fund The following table describes the fees and expenses that you may pay if you buy and hold shares of the Fund. ANNUAL FUND OPERATING EXPENSES (Expenses that you pay each year as a percentage of the value of your investment) Management Fees 0.25% Distribution (Rule 12b-1) Fees NONE Other Expenses Shareholder Service Fees 0.10 Remainder of Other Expenses 0.23 Total Other Expenses 0.33 Total Annual Fund Operating Expenses Fee Waivers and Expense Reimbursements 1 (0.13) Net Expenses The Fund s adviser, administrator and distributor (the Service Providers ) have contractually agreed to waive fees and/or reimburse expenses to the extent Total Annual Fund Operating Expenses of Institutional Class Shares (excluding acquired fund fees and expenses, dividend expenses relating to short sales, interest, taxes and extraordinary expenses and expenses related to the Board of Trustees deferred compensation plan) exceed 0.45% of their average daily net assets. This contract continues through 10/31/10, at which time the Service Providers will determine whether or not to renew or revise it. Example The example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds. It assumes you invest $10,000 in the Fund for the time periods indicated. The example also assumes that your investment has a 5% return each year and the Fund s expenses are equal to the net expenses shown in the fee table through 10/31/10 and total annual fund operating expenses thereafter. Your actual costs may be higher or lower. WHETHER OR NOT YOU SELL YOUR SHARES, YOUR COST WOULD BE: 1 Year 3 Years 5 Years 10 Years INSTITUTIONAL CLASS SHARES ($) Portfolio Turnover The Fund pays transaction costs, such as commissions, when it buys and sells securities (or turns over its portfolio). A higher portfolio turnover may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses, or in the Example, affect the Fund s performance. During the Fund s most recent fiscal year, the Fund s portfolio turnover was 92% of the average value of its portfolio. NOVEMBER 1,

4 JPMorgan Disciplined Equity Fund (continued) What are the Fund s main investment strategies? Under normal circumstances, the Fund invests at least 80% of its assets in equity securities. In implementing this strategy, the Fund primarily invests in the common stocks of U.S. companies with market capitalizations similar to those within the universe of the S&P 500 Index. As of September 30, 2009, the market capitalizations of the companies in the S&P 500 Index ranged from $1 billion to $330 billion. Sector by sector, the Fund s weightings are similar to those of the S&P 500 Index. Within each sector, the Fund modestly overweights equity securities that it considers undervalued or fairly valued while modestly underweighting or not holding equity securities that appear overvalued. By owning a large number of equity securities within the S&P 500 Index, with an emphasis on those that appear undervalued or fairly valued, the Fund seeks returns that modestly exceed those of the S&P 500 Index over the long term with virtually the same level of volatility. Derivatives, which are instruments that have a value based on another instrument, exchange rate or index, may be used as substitutes for securities in which the Fund can invest. The Fund may use derivatives, including futures contracts, options and swaps, to more effectively gain targeted equity exposure from its cash positions, to hedge various investments and for risk management. Investment Process: In managing the Fund, the adviser employs a three-step process that combines research, valuation and stock selection. The adviser takes an in-depth look at company prospects over a period as long as five years, which is designed to provide insight into a company s real growth potential. The research findings allow the adviser to rank the companies in each sector group according to their relative value. On behalf of the Fund, the adviser then buys and sells equity securities, using the research and valuation rankings as a basis. In general, the adviser buys equity securities that are identified as undervalued and considers selling them when they appear overvalued. Along with attractive valuation, the adviser often considers a number of other criteria: catalysts that could trigger a rise in a stock s price Impact on the overall risk of the portfolio relative to the benchmark high perceived potential reward compared to perceived potential risk possible temporary mispricings caused by apparent market overreactions The Fund s Main Investment Risks The Fund is subject to management risk and may not achieve its objective if the adviser s expectations regarding particular securities or markets are not met. Equity Market Risk. The price of equity securities may rise or fall because of changes in the broad market or changes in a company s financial condition, sometimes rapidly or unpredictably. These price movements may result from factors affecting individual companies, sectors or industries selected for the Fund s portfolio or the securities market as a whole, such as changes in economic or political conditions. When the value of the Fund s securities goes down, your investment in the Fund decreases in value. Mid Cap Company Risk. Investments in mid cap companies may be riskier, more volatile and more vulnerable to economic, market and industry changes than investments in larger, more established companies. As a result, share price changes may be more sudden or erratic than the prices of other equity securities, especially over the short term. Derivatives Risk. Derivatives may be riskier than other types of investments because they may be more sensitive to changes in economic or market conditions than other types of investments and could result in losses that significantly exceed the Fund s original investment. Many derivatives create leverage thereby causing the Fund to be more volatile than it would be if it had not used derivatives. Redemption Risk. The Fund could experience a loss when selling securities to meet redemption requests by shareholders if the redemption requests are unusually large or frequent, occur in times of overall market turmoil or declining prices for the securities sold, or when the securities the Fund wishes to or is required to sell are illiquid. Investments in the Fund are not deposits or obligations of, or guaranteed or endorsed by, any bank and are not insured or guaranteed by the FDIC, the Federal Reserve Board or any other government agency. You could lose money if you sell when the Fund s share price is lower than when you invested. 2 J.P. MORGAN U.S. EQUITY FUNDS

5 TheFund spastperformance This section provides some indication of the risks of investing in the Fund. The bar chart shows how the performance of the Fund s Institutional Class Shares has varied from year to year for the past ten calendar years. The table shows the average annual total returns over the past one year, five years and ten years. It compares that performance to the S&P 500 Index and the Lipper Large-Cap Core Funds Index, an index based on the total returns of certain mutual funds within the Fund s designated category as determined by Lipper. Unlike the other index, the Lipper index includes the expenses of the mutual funds included in the index. Past performance (before and after taxes) is not necessarily an indication of how any class of the Fund will perform in the future. Updated performance information is available by visiting or by calling YEAR-BY-YEAR RETURNS* % 11.71% 24.76% 3.84% 5.13% 36.70% 11.23% Best Quarter 2nd quarter, % Worst Quarter 4th quarter, % 18.32% 15.59% 29.60% AVERAGE ANNUAL TOTAL RETURNS (For periods ended December 31, 2008)* Past 1Year Past 5Years Past 10 Years INSTITUTIONAL CLASS SHARES Return Before Taxes (36.70)% (2.34)% (2.12)% Return After Taxes on Distributions (36.90) (2.57) (2.56) Return After Taxes on Distributions and Sale of Fund Shares (23.49) (1.89) (1.88) S&P 500 INDEX (Reflects No Deduction for Fees, Expenses or Taxes) (37.00) (2.19) (1.38) LIPPER LARGE-CAP CORE FUNDS INDEX (Reflects No Deduction for Taxes) (37.07) (2.73) (1.90) After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on the investor s tax situation and may differ from those shown, and the after-tax returns shown are not relevant to investors who hold their shares through tax-deferred arrangements such as 401(k) plans or individual retirement accounts. * Prior to a merger effective 9/7/01, the Fund operated in a master-feeder structure. The performance for the Institutional Class Shares for the period from 1/1/99 to 9/10/01 (the date Institutional Class Shares were launched) is based on the performance of the institutional feeder (whose investment program was identical to the investment program of, and whose expenses were substantially similar to the current expenses of, the Institutional Class Shares). The Fund s year-to-date total return through 9/30/09 was 23.38%. NOVEMBER 1,

6 JPMorgan Disciplined Equity Fund (continued) Portfolio Management J.P. Morgan Investment Management Inc. serves as investment adviser to the Fund. The primary portfolio managers for the Fund are: Portfolio Manager Managed the Fund Since Primary Title with Investment Adviser Raffaele Zingone 2002 Vice President Terance Chen 2005 Vice President Scott Blasdell 2009 Managing Director Purchase and Sale of Fund Shares Purchase minimums For Institutional Class Shares To establish an account $3,000,000 To add to an account No minimum levels In general, you may redeem shares on any business day Through your Financial Intermediary By writing to J.P. Morgan Funds Services, P.O. Box 8528, Boston, MA By calling J.P. Morgan Funds Services at Tax Information The Fund intends to make distributions that may be taxed as ordinary income or capital gains, except when your investment is in an IRA, 401(k) plan or other tax-advantaged investment plan. Payments to Broker-Dealers and Other Financial Intermediaries If you purchase shares of the Fund through a broker-dealer or other financial intermediary (such as a bank), the Fund and its related companies may pay the financial intermediary for the sale of Fund shares and related services. These payments may create a conflict of interest by influencing the broker-dealer or financial intermediary and your salesperson to recommend the Fund over another investment. Ask your salesperson or visit your financial intermediary s web site for more information. 4 J.P. MORGAN U.S. EQUITY FUNDS

7 JPMorgan Diversified Fund Class/Ticker: Institutional/JPDVX What is the goal of the Fund? The Fund seeks to provide a high total return from a diversified portfolio of equity and fixed income investments. Fees and Expenses for Institutional Class Shares of the Fund The following table describes the fees and expenses that you may pay if you buy and hold shares of the Fund. ANNUAL FUND OPERATING EXPENSES (Expenses that you pay each year as a percentage of the value of your investment) Management Fees 0.55% Distribution (Rule 12b-1) Fees NONE Other Expenses Shareholder Service Fees 0.10 Remainder of Other Expenses 0.35 Total Other Expenses 0.45 Acquired Fund Fees and Expenses 0.06 Total Annual Fund Operating Expenses Fee Waivers and Expense Reimbursements 1 (0.35) Net Expenses The Fund s adviser, administrator and distributor (the Service Providers ) have contractually agreed to waive fees and/or reimburse expenses to the extent Total Annual Fund Operating Expenses of Institutional Class Shares (excluding Acquired Fund Fees and Expenses, dividend expenses relating to short sales, interest, taxes and extraordinary expenses and expenses related to the Board of Trustees deferred compensation plan) exceed 0.65% of their average daily net assets. This contract continues through 10/31/10, at which time the Service Providers will determine whether or not to renew or revise it. Example The example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds. It assumes you invest $10,000 in the Fund for the time periods indicated. The example also assumes that your investment has a 5% return each year and the Fund s expenses are equal to the net expenses shown in the fee table through 10/31/10 and total annual fund operating expenses thereafter. Your actual costs may be higher or lower. WHETHER OR NOT YOU SELL YOUR SHARES, YOUR COST WOULD BE: 1 Year 3 Years 5 Years 10 Years INSTITUTIONAL CLASS SHARES ($) ,263 Portfolio Turnover The Fund pays transaction costs, such as commissions, when it buys and sells securities (or turns over its portfolio). A higher portfolio turnover may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses, or in the Example, affect the Fund s performance. During the Fund s most recent fiscal year, the Fund s portfolio turnover was 165% of the average value of its portfolio. NOVEMBER 1,

8 JPMorgan Diversified Fund (continued) What are the Fund s main investment strategies? Drawing on a variety of analytical tools, the Fund s adviser allocates assets among various types of equity and fixed income investments, based on the following model allocation: 30% 60% medium- and large-cap U.S. equity securities 25% 50% U.S. and foreign fixed income securities 0% 30% foreign equity securities 0% 20% small-cap U.S. equity securities The adviser may periodically increase or decrease the Fund s actual asset allocation according to the relative attractiveness of each asset class. Within its equity allocations, the Fund primarily invests in the common stock and convertible securities of U.S. and foreign companies. Within its fixed income allocations, the Fund primarily invests in corporate bonds, mortgage-backed securities, mortgage dollar rolls and U.S. government securities. The Fund s bond investments will primarily be rated investment grade by a national rating organization, but the Fund may also invest in certain high yield, high risk, non-investment grade securities (also known as junk bonds) in the rating categories Ba or B by Moody s, BB or B by S&P and Fitch or the equivalent by another national rating organization or if unrated, that are deemed by the adviser to be of comparable quality. In addition to purchasing securities directly, the Fund may invest up to 20% of its assets in shares of other J.P. Morgan Funds in order to expose the Fund to certain asset classes when the adviser believes it is appropriate. Derivatives, which are instruments that have a value based on another instrument, exchange rate or index, may be used as substitutes for securities in which the Fund can invest. The Fund may use derivatives, including futures contracts, options and swaps, to more effectively gain targeted equity exposure from its cash positions, to hedge various investments and for risk management. Investment Process: Within its asset allocation framework, the adviser selects the Fund s securities. Within the equity portion of the portfolio, the Fund keeps its sector weightings in line with the markets in which it invests, while actively seeking the most attractive stocks within each sector. Foreign stocks are chosen using a similar process, while also monitoring country allocation and currency exposure. Within the fixed income portion of the portfolio, the adviser uses fundamental, economic and capital markets research to select securities. The adviser actively manages the mix of U.S. and foreign bonds while typically keeping duration within one year of the average for the U.S. investment grade bond universe (currently about five years). Duration is a measure of the price sensitivity of a debt security or a portfolio of debt securities to relative changes in interest rates. The Fund s Main Investment Risks The Fund is subject to management risk and may not achieve its objective if the adviser s expectations regarding particular securities or markets are not met. Equity Market Risk. The price of equity securities may rise or fall because of changes in the broad market or changes in a company s financial condition, sometimes rapidly or unpredictably. These price movements may result from factors affecting individual companies, sectors or industries selected for the Fund s portfolio or the securities market as a whole, such as changes in economic or political conditions. When the value of the Fund s securities goes down, your investment in the Fund decreases in value. Foreign Securities and Emerging Markets Risks. Investments in foreign issuers are subject to additional risks, including political and economic risks, greater volatility, currency fluctuations, higher transaction costs, delayed settlement, possible foreign controls on investment, and less stringent investor protection and disclosure standards of foreign markets. These risks are magnified in countries in emerging markets. Smaller Cap Company Risk. Investments in securities of smaller companies may be riskier, more volatile and vulnerable to economic, market and industry changes than securities of larger, more established companies. As a result, share price changes may be more sudden or erratic than the prices of other equity securities, especially over the short term. Investments in Mutual Funds Risk. To the extent the Fund invests in underlying J.P. Morgan Funds, the Fund s investment performance and risks are directly related to the performance and risks of the underlying funds. Shareholders will indirectly bear the expenses charged by those underlying funds. Income Securities Risk. Investments in income securities will change in value based on changes in interest rates and are subject to the risk that a counterparty will fail to make payments when due or default. If interest rates increase, the value of the Fund s income securities generally drops. Mortgage-related and asset-backed securities including so called sub-prime mortgages are subject to certain other risks including prepayment and call risks. Mortgage-related and asset-backed securities may decline in value, face valuation difficulties, be more volatile and/or be illiquid. High Yield Securities Risk. Some of the Fund s investments are in securities and instruments that are issued by companies that are highly leveraged, less creditworthy or financially distressed. These investments are considered to be speculative and are subject to greater risk of loss, greater sensitivity to interest rate 6 J.P. MORGAN U.S. EQUITY FUNDS

9 and economic changes, valuation difficulties, and potential illiquidity. Derivatives Risk. Derivatives may be riskier than other types of investments because they may be more sensitive to changes in economic or market conditions than other types of investments and could result in losses that significantly exceed the Fund s original investment. Many derivatives create leverage thereby causing the Fund to be more volatile than it would be if it had not used derivatives. High Portfolio Turnover Risk. The Fund may engage in active and frequent trading leading to increased portfolio turnover, higher transaction costs, and the possibility of increased capital gains, including short-term capital gains that will generally be taxable to shareholders as ordinary income. Redemption Risk. The Fund could experience a loss when selling securities to meet redemption requests by shareholders if the redemption requests are unusually large or frequent, occur in times of overall market turmoil or declining prices for the securities sold, or when the securities the Fund wishes to or is required to sell are illiquid. Investments in the Fund are not deposits or obligations of, or guaranteed or endorsed by, any bank and are not insured or guaranteed by the FDIC, the Federal Reserve Board or any other government agency. You could lose money if you sell when the Fund s share price is lower than when you invested. TheFund spastperformance This section provides some indication of the risks of investing in the Fund. The bar chart shows how the performance of the Fund s Institutional Class Shares has varied from year to year for the past ten calendar years. The table shows the average annual total returns for the past one year, five years and ten years. It compares that performance to the Diversified Composite Benchmark, a customized benchmark, the S&P 500 Index, a broad-based securities market index, and the Lipper Mixed Asset Target Allocation Growth Funds Index, an index based on the total returns of certain mutual funds within the Fund s designated category as determined by Lipper. Unlike the other index, the Lipper index includes the expenses of the mutual funds included in the index. The Diversified Composite Benchmark is a composite benchmark of unmanaged indexes that corresponds to the Fund s model allocation and that consists of S&P 500 (60%) and Barclays Capital U.S. Aggregate (40%) (formerly Lehman Brothers U.S. Aggregate (40%) Index) indexes. Past performance (before and after taxes) is not necessarily an indication of how any class of the Fund will perform in the future. Updated performance information is available by visiting or by calling YEAR-BY-YEAR RETURNS* % 14.23% 5.54% 13.00% 21.20% 9.55% 4.54% 12.83% 7.06% 25.24% Best Quarter 2nd quarter, % Worst Quarter 4th quarter, % The Fund s year-to-date total return through 9/30/09 was 21.94%. NOVEMBER 1,

10 JPMorgan Diversified Fund (continued) AVERAGE ANNUAL TOTAL RETURNS (For periods ended December 31, 2008)* Past 1Year Past 5Years Past 10 Years INSTITUTIONAL CLASS SHARES Return Before Taxes (25.24)% 0.68% 1.23% Return After Taxes on Distributions (25.98) (0.41) 0.11 Return After Taxes on Distributions and Sale of Fund Shares (15.71) DIVERSIFIED COMPOSITE BENCHMARK (Reflects No Deduction for Fees, Expenses or Taxes) (22.06) S&P 500 INDEX (Reflects No Deduction for Fees, Expenses or Taxes) (37.00) (2.19) (1.38) LIPPER MIXED ASSET TARGET ALLOCATION GROWTH FUNDS INDEX (Reflects No Deduction for Taxes) (29.06) (0.10) 1.77 After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on the investor s tax situation and may differ from those shown, and the after-tax returns shown are not relevant to investors who hold their shares through tax-deferred arrangements such as 401(k) plans or individual retirement accounts. * Prior to a merger effective 9/7/01, the Fund operated in a master-feeder structure. The Fund s performance for the period from 1/1/99 to 9/10/01 (the date Institutional Class Shares were launched) is based on the performance of the institutional feeder (whose investment program was identical to the investment program of, and whose expenses were substantially similar to the current expenses of, the Institutional Class Shares). Portfolio Management J.P. Morgan Investment Management Inc. serves as investment adviser to the Fund. The primary portfolio managers for the Fund are: Portfolio Manager Managed the Fund Since Primary Title with Investment Adviser Patrik Jakobson 2002 Managing Director Michael Fredericks 2007 Vice President Michael Schoenhaut 2009 Vice President Scott Grimshaw 2005 Vice President Thomas Luddy 2006 Managing Director Christopher Blum 2008 Managing Director Jeroen Huysinga 2009 Managing Director Purchase and Sale of Fund Shares Purchase minimums For Institutional Class Shares To establish an account $3,000,000 To add to an account No minimum levels In general, you may redeem shares on any business day Through your Financial Intermediary By writing to J.P. Morgan Funds Services, P.O. Box 8528, Boston, MA By calling J.P. Morgan Funds Services at Tax Information The Fund intends to make distributions that may be taxed as ordinary income or capital gains, except when your investment is in an IRA, 401(k) plan or other tax-advantaged investment plan. Payments to Broker-Dealers and Other Financial Intermediaries If you purchase shares of the Fund through a broker-dealer or other financial intermediary (such as a bank), the Fund and its related companies may pay the financial intermediary for the sale of Fund shares and related services. These payments may create a conflict of interest by influencing the broker-dealer or financial intermediary and your salesperson to recommend the Fund over another investment. Ask your salesperson or visit your financial intermediary s web site for more information. 8 J.P. MORGAN U.S. EQUITY FUNDS

11 JPMorgan Mid Cap Value Fund Class/Ticker: Institutional/FLMVX What is the goal of the Fund? The Fund seeks growth from capital appreciation. Fees and Expenses for Institutional Class Shares of the Fund The following tables describe the fees and expenses that you may pay if you buy and hold shares of the Fund. ANNUAL FUND OPERATING EXPENSES (Expenses that you pay each year as a percentage of the value of your investment) Management Fees 0.65% Distribution (Rule 12b-1) Fees NONE Other Expenses Shareholder Service Fees 0.10 Remainder of Other Expenses 0.27 Total Other Expenses 0.37 Acquired Fund Fees and Expenses 0.01 Total Annual Fund Operating Expenses Fee Waivers and Expense Reimbursements 1 (0.27) Net Expenses The Fund s adviser, administrator and distributor (the Service Providers ) have contractually agreed to waive fees and/or reimburse expenses to the extent Total Annual Fund Operating Expenses of Institutional Class Shares (excluding Acquired Fund Fees and Expenses, dividend expenses related to short sales, interest, taxes and extraordinary expenses and expenses related to the Board of Trustees deferred compensation plan) exceeds 0.75% of their average daily net assets. This contract continues through 10/31/10, at which time the Service Providers will determine whether or not to renew or revise it. Example The example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds. It assumes you invest $10,000 in the Fund for the time periods indicated. The example also assumes that your investment has a 5% return each year and the Fund s expenses are equal to the net expenses shown in the fee table through 10/31/10 and total annual fund operating expenses thereafter. Your actual costs may be higher or lower. WHETHER OR NOT YOU SELL YOUR SHARES, YOUR COST WOULD BE: 1 Year 3 Years 5 Years 10 Years INSTITUTIONAL CLASS SHARES ($) ,235 Portfolio Turnover The Fund pays transaction costs, such as commissions, when it buys and sells securities (or turns over its portfolio). A higher portfolio turnover may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses, or in the Example, affect the Fund s performance. During the Fund s most recent fiscal year, the Fund s portfolio turnover was 47% of the average value of its portfolio. NOVEMBER 1,

12 JPMorgan Mid Cap Value Fund (continued) What are the Fund s main investment strategies? Under normal circumstances, the Fund invests at least 80% of its assets in equity securities of mid cap companies. Mid cap companies are companies with market capitalizations between $1 billion to $15 billion at the time of purchase. In implementing its main strategies, the Fund s investments are primarily in common stocks and real estate investment trusts (REITs). Derivatives, which are instruments that have a value based on another instrument, exchange rate or index, may be used as substitutes for securities in which the Fund can invest. The Fund may use derivatives, including futures contracts, options and swaps, to more effectively gain targeted equity exposure from its cash positions, to hedge various investments, for risk management and to increase the Fund s gain. Investment Process: In managing the Fund, the adviser employs a bottom-up approach to stock selection, constructing portfolios based on company fundamentals, quantitative screening and proprietary fundamental analysis. The adviser looks for quality companies, which appear to be undervalued and to have the potential to grow intrinsic value per share. Quality companies generally have a sustainable competitive position, low business cyclicality, high returns on invested capital and strong experienced management. The adviser may sell a security for several reasons. A security may be sold due to a change in the company s fundamentals or if the adviser believes the security is no longer attractively valued. Investments may also be sold if the adviser identifies a stock that it believes offers a better investment opportunity. The Fund s Main Investment Risks The Fund is subject to management risk and may not achieve its objective if the adviser s expectations regarding particular securities or markets are not met. Equity Market Risk. The price of equity securities may rise or fall because of changes in the broad market or changes in a company s financial condition, sometimes rapidly or unpredictably. These price movements may result from factors affecting individual companies, sectors or industries selected for the Fund s portfolio or the securities market as a whole, such as changes in economic or political conditions. When the value of the Fund s securities goes down, your investment in the Fund decreases in value. Mid Cap Company Risk. Investments in mid cap companies may be riskier, more volatile and more vulnerable to economic, market and industry changes than investments in larger, more established companies. As a result, share price changes may be more sudden or erratic than the prices of other equity securities, especially over the short term. Value Investing Risk. A value stock may decrease in price or may not increase in price as anticipated by the adviser if other investors fail to recognize the company s value or the factors that the adviser believes will cause the stock price to increase do not occur. Derivatives Risk. Derivatives may be riskier than other types of investments because they may be more sensitive to changes in economic or market conditions than other types of investments and could result in losses that significantly exceed the Fund s original investment. Many derivatives create leverage thereby causing the Fund to be more volatile than it would be if it had not used derivatives. Real Estate Securities Risk. The Fund s investments in real estate securities, including REITs, are subject to the same risks as direct investments in real estate and mortgages, and their value will depend on the value of the underlying real estate interests. Redemption Risk. The Fund could experience a loss when selling securities to meet redemption requests by shareholders if the redemption requests are unusually large or frequent, occur in times of overall market turmoil or declining prices for the securities sold, or when the securities the Fund wishes to or is required to sell are illiquid. Investments in the Fund are not deposits or obligations of, or guaranteed or endorsed by, any bank and are not insured or guaranteed by the FDIC, the Federal Reserve Board or any other government agency. You could lose money if you sell when the Fund s share price is lower than when you invested. 10 J.P. MORGAN U.S. EQUITY FUNDS

13 TheFund spastperformance This section provides some indication of the risks of investing in the Fund. The bar chart shows how the performance of the Fund s Institutional Class Shares has varied from year to year for the past ten calendar years. The table shows the average annual total returns over the past one year, five years and ten years. It compares that performance to the Russell Midcap T Value Index and the Lipper Mid-Cap Value Funds Index and Lipper Mid-Cap Core Funds Index, both of which are indexes based on the total returns of certain mid cap mutual funds as determined by Lipper. The Fund s Lipper Index changed to the Lipper Mid-Cap Core Funds Index because Lipper recategorized the Fund. Unlike the other index, the Lipper index includes the expenses of the mutual funds included in the index. Past performance (before and after taxes) is not necessarily an indication of how any class of the Fund will perform in the future. Updated performance information is available by visiting or by calling YEAR-BY-YEAR RETURNS % 13.87% 9.91% 3.23% 32.90% 9.42% 20.99% 17.32% 35.28% 30.62% AVERAGE ANNUAL TOTAL RETURNS (For periods ended December 31, 2008) Past 1Year Past 5Years Past 10 Years INSTITUTIONAL CLASS SHARES Return Before Taxes (32.90)% 1.39% 9.36% Return After Taxes on Distributions (33.46) Return After Taxes on Distributions and Sale of Fund Shares (20.69) RUSSELL MIDCAP T VALUE FUNDS INDEX (Reflects No Deduction for Fees, Expenses or Taxes) (38.44) LIPPER MID-CAP CORE FUNDS INDEX (Reflects No Deduction for Taxes) (38.53) (1.29) 3.20 LIPPER MID-CAP VALUE FUNDS INDEX (Reflects No Deduction for Taxes) (39.71) (1.24) 3.95 After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on the investor s tax situation and may differ from those shown, and the after-tax returns shown are not relevant to investors who hold their shares through tax-deferred arrangements such as 401(k) plans or individual retirement accounts. Best Quarter 2nd quarter, % Worst Quarter 4th quarter, % The Fund s year-to-date total return through 9/30/09 was 19.86%. NOVEMBER 1,

14 JPMorgan Mid Cap Value Fund (continued) Portfolio Management J.P. Morgan Investment Management Inc. serves as investment adviser to the Fund. The primary portfolio managers for the Fund are: Portfolio Manager Managed the Fund Since Primary Title with Investment Adviser Jonathan Simon 1997 Managing Director Lawrence Playford 2004 Vice President Gloria Fu 2006 Vice President Purchase and Sale of Fund Shares Purchase minimums For Institutional Class Shares To establish an account $3,000,000 To add to an account No minimum levels Tax Information The Fund intends to make distributions that may be taxed as ordinary income or capital gains, except when your investment is in an IRA, 401(k) plan or other tax-advantaged investment plan. Payments to Broker-Dealers and Other Financial Intermediaries If you purchase shares of the Fund through a broker-dealer or other financial intermediary (such as a bank), the Fund and its related companies may pay the financial intermediary for the sale of Fund shares and related services. These payments may create a conflict of interest by influencing the broker-dealer or financial intermediary and your salesperson to recommend the Fund over another investment. Ask your salesperson or visit your financial intermediary s web site for more information. In general, you may redeem shares on any business day Through your Financial Intermediary By writing to J.P. Morgan Funds Services, P.O. Box 8528, Boston, MA By calling J.P. Morgan Funds Services at J.P. MORGAN U.S. EQUITY FUNDS

15 JPMorgan Small Cap Growth Fund Class/Ticker: Institutional/JISGX What is the goal of the Fund? The Fund seeks long-term capital growth primarily by investing in a portfolio of equity securities of small-capitalization and emerging growth companies. Fees and Expenses for Institutional Class Shares of the Fund The following table describes the fees and expenses that you may pay if you buy and hold shares of the Fund. ANNUAL FUND OPERATING EXPENSES (Expenses that you pay each year as a percentage of the value of your investment) Management Fees 0.65% Distribution (Rule 12b-1) Fees NONE Other Expenses Shareholder Service Fees 0.10 Remainder of Other Expenses 0.44 Total Other Expenses 0.54 Acquired Fund Fees and Expenses 0.01 Total Annual Fund Operating Expenses Fee Waivers and Expense Reimbursements 1 (0.34) Net Expenses Example The example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds. It assumes you invest $10,000 in the Fund for the time periods indicated. The example also assumes that your investment has a 5% return each year and the Fund s expenses are equal to the net expenses shown in the fee table through 10/31/10 and total annual fund operating expenses thereafter. Your actual costs may be higher or lower. WHETHER OR NOT YOU SELL YOUR SHARES, YOUR COST WOULD BE: 1 Year 3 Years 5 Years 10 Years INSTITUTIONAL CLASS SHARES ($) ,424 Portfolio Turnover The Fund pays transaction costs, such as commissions, when it buys and sells securities (or turns over its portfolio). A higher portfolio turnover may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses, or in the Example, affect the Fund s performance. During the Fund s most recent fiscal year, the Fund s portfolio turnover was 83% of the average value of its portfolio. 1 The Fund s adviser, administrator and distributor (the Service Providers ) have contractually agreed to waive fees and/or reimburse expenses to the extent Total Annual Fund Operating Expenses of Institutional Class Shares (excluding Acquired Fund Fees and Expenses, dividend expenses relating to short sales, interest, taxes and extraordinary expenses and expenses related to the Board of Trustees deferred compensation plan) exceed 0.85% of their average daily net assets. This contract continues through 10/31/10, at which time the Service Providers will determine whether or not to renew or revise it. NOVEMBER 1,

16 JPMorgan Small Cap Growth Fund (continued) What are the Fund s main investment strategies? Under normal circumstances, at least 80% of the Fund s assets will be invested in the securities of small capitalization companies. Small cap companies are companies with market capitalizations equal to those within the universe of the Russell 2000 T Growth Index stocks at the time of purchase. As of September 30, 2009, the market capitalizations of the companies in the Russell 2000 Growth Index ranged from $14 million to $3.6 billion. In implementing its main strategies, the Fund will invest primarily in common stocks. Typically, the Fund invests in securities of companies with a history of above-average growth, as well as companies expected to have above-average growth. Derivatives, which are instruments that have a value based on another instrument, exchange rate or index, may be used as substitutes for securities in which the Fund can invest. The Fund may use derivatives, including futures contracts, options and swaps, to more effectively gain targeted equity exposure from its cash positions, to hedge various investments, for risk management and to increase the Fund s gain. Investment Process: In managing the Fund, the adviser employs a process that combines research, valuation and stock selection to identify companies that have a history of above-average growth or which the adviser believes will achieve aboveaverage growth in the future. Growth companies purchased for the Fund include those with leading competitive positions, predictable and durable business models and management that can achieve sustained growth. The adviser may sell a security for several reasons. A security may be sold due to a change in the company s fundamentals or if the adviser believes the security is no longer attractively valued. Investments may also be sold if the adviser identifies a stock that it believes offers a better investment opportunity. The Fund s Main Investment Risks The Fund is subject to management risk and may not achieve its objective if the adviser s expectations regarding particular securities or markets are not met. Equity Market Risk. The price of equity securities may rise or fall because of changes in the broad market or changes in a company s financial condition, sometimes rapidly or unpredictably. These price movements may result from factors affecting individual companies, sectors or industries selected for the Fund s portfolio or the securities market as a whole, such as changes in economic or political conditions. When the value of the Fund s securities goes down, your investment in the Fund decreases in value. Small Cap Company Risk. Investments in small cap companies may be riskier, more volatile and more vulnerable to economic, market and industry changes than investments in larger, more established companies. As a result, share price changes may be more sudden or erratic than the prices of other equity securities, especially over the short term. Growth Investing Risk. Because growth investing attempts to identify companies that the adviser believes will experience rapid earnings growth relative to value or other types of stocks, growth stocks may trade at higher multiples of current earnings compared to value or other stocks, leading to inflated prices and thus potentially greater declines in value. Derivatives Risk. Derivatives may be riskier than other types of investments because they may be more sensitive to changes in economic or market conditions than other types of investments and could result in losses that significantly exceed the Fund s original investment. Many derivatives create leverage thereby causing the Fund to be more volatile than it would be if it had not used derivatives. Redemption Risk. The Fund could experience a loss when selling securities to meet redemption requests by shareholders if the redemption requests are unusually large or frequent, occur in times of overall market turmoil or declining prices for the securities sold, or when the securities the Fund wishes to or is required to sell are illiquid. Investments in the Fund are not deposits or obligations of, or guaranteed or endorsed by, any bank and are not insured or guaranteed by the FDIC, the Federal Reserve Board or any other government agency. You could lose money if you sell when the Fund s share price is lower than when you invested. 14 J.P. MORGAN U.S. EQUITY FUNDS

17 TheFund spastperformance This section provides some indication of the risks of investing in the Fund. The bar chart shows how the performance of the Fund s Institutional Class Shares has varied from year to year for the past ten calendar years. The table shows the average annual total returns over the past one year, five years and ten years. It compares that performance to the Russell 2000 T Growth Index and Lipper Small-Cap Growth Funds Index, an index based on the total returns of certain mutual funds within the Fund s designated category as determined by Lipper. Unlike the other index, the Lipper index includes the expenses of the mutual funds included in the index. Past performance (before and after taxes) is not necessarily an indication of how any class of the Fund will perform in the future. Updated performance information is available by visiting or by calling YEAR-BY-YEAR RETURNS * % 6.35% 20.94% 6.67% 43.14% Best Quarter 4th quarter, % Worst Quarter 4th quarter, % 20.71% 16.51% 12.82% 26.57% 34.45% AVERAGE ANNUAL TOTAL RETURNS (For periods ended December 31, 2008)* Past 1Year Past 5Years Past 10 Years INSTITUTIONAL CLASS SHARES Return Before Taxes (43.14)% (0.75)% 2.78% Return After Taxes on Distributions (43.14) (2.49) 1.32 Return After Taxes on Distributions and Sale of Fund Shares (28.04) (0.43) 2.25 RUSSELL 2000 T GROWTH INDEX (Reflects No Deduction for Fees, Expenses or Taxes) (38.54) (2.35) (0.76) LIPPER SMALL-CAP GROWTH FUNDS INDEX (Reflects No Deduction for Taxes) (42.62) (4.06) 0.92 After-tax returns are calculated using the historical highest individual federal marginal income tax rates and do not reflect the impact of state and local taxes. Actual after-tax returns depend on the investor s tax situation and may differ from those shown, and the after-tax returns shown are not relevant to investors who hold their shares through tax-deferred arrangements such as 401(k) plans or individual retirement accounts. * Historical performance shown for Institutional Class Shares prior to 1/1/06 in the bar chart and prior to their inception on 2/19/05 in the table is based on the performance of the Fund s Select Class Shares, which invest in the same portfolio of securities, but whose shares are not offered in this prospectus. The actual returns of the Institutional Class Shares would have been different than those shown because Institutional Class Shares have different expenses than Select Class Shares. The Fund s year-to-date total return through 9/30/09 was 32.54%. NOVEMBER 1,

18 JPMorgan Small Cap Growth Fund (continued) Portfolio Management JPMorgan Investment Advisors Inc. serves as investment adviser to the Fund. The primary portfolio managers for the Fund are: Portfolio Manager Managed the Fund Since Primary Title with Investment Adviser Christopher Jones 2004 Managing Director Eytan Shapiro 2004 Managing Director Purchase and Sale of Fund Shares Purchase minimums For Institutional Class Shares To establish an account $3,000,000 To add to an account No minimum levels In general, you may redeem shares on any business day Through your Financial Intermediary By writing to J.P. Morgan Funds Services, P.O. Box 8528, Boston, MA By calling J.P. Morgan Funds Services at Tax Information The Fund intends to make distributions that may be taxed as ordinary income or capital gains, except when your investment is in an IRA, 401(k) plan or other tax-advantaged investment plan. Payments to Broker-Dealers and Other Financial Intermediaries If you purchase shares of the Fund through a broker-dealer or other financial intermediary (such as a bank), the Fund and its related companies may pay the financial intermediary for the sale of Fund shares and related services. These payments may create a conflict of interest by influencing the broker-dealer or financial intermediary and your salesperson to recommend the Fund over another investment. Ask your salesperson or visit your financial intermediary s web site for more information. 16 J.P. MORGAN U.S. EQUITY FUNDS

19 JPMorgan U.S. Equity Fund Class/Ticker: Institutional/JMUEX What is the goal of the Fund? The Fund seeks to provide high total return from a portfolio of selected equity securities. Fees and Expenses for Institutional Class Shares of the Fund The following tables describe the fees and expenses that you may pay if you buy and hold shares of the Fund. ANNUAL FUND OPERATING EXPENSES (Expenses that you pay each year as a percentage of the value of your investment) Management Fees 0.40% Distribution (Rule 12b-1) Fees NONE Other Expenses Shareholder Service Fees 0.10 Remainder of Other Expenses 0.22 Total Other Expenses 0.32 Acquired Fund Fees and Expenses 0.01 Total Annual Fund Operating Expenses Fee Waivers and Expense Reimbursements 1 (0.08) Net Expenses The Fund s adviser, administrator and distributor (the Service Providers ) have contractually agreed to waive fees and/or reimburse expenses to the extent Total Annual Fund Operating Expenses of Institutional Class Shares (excluding acquired fund fees and expenses, dividend expenses relating to short sales, interest, taxes and extraordinary expenses and expenses related to the Board of Trustees deferred compensation plan) exceed 0.64% of their average daily net assets. This contract continues through 10/31/10, at which time the Service Providers will determine whether or not to renew or revise it. Example The example is intended to help you compare the cost of investing in the Fund with the cost of investing in other mutual funds. It assumes you invest $10,000 in the Fund for the time periods indicated. The example also assumes that your investment has a 5% return each year and the Fund s expenses are equal to the net expenses shown in the fee table through 10/31/10 and total annual fund operating expenses thereafter. Your actual costs may be higher or lower. WHETHER OR NOT YOU SELL YOUR SHARES, YOUR COST WOULD BE: 1 Year 3 Years 5 Years 10 Years INSTITUTIONAL CLASS SHARES ($) Portfolio Turnover The Fund pays transaction costs, such as commissions, when it buys and sells securities (or turns over its portfolio). A higher portfolio turnover may indicate higher transaction costs and may result in higher taxes when Fund shares are held in a taxable account. These costs, which are not reflected in annual fund operating expenses, or in the Example, affect the Fund s performance. During the Fund s most recent fiscal year, the Fund s portfolio turnover was 101% of the average value of its portfolio. NOVEMBER 1,

20 JPMorgan U.S. Equity Fund (continued) What are the Fund s main investment strategies? Under normal circumstances, the Fund invests at least 80% of its assets in equity securities of U.S. companies. In implementing its strategy, the Fund primarily invests in common stocks of large- and medium-capitalization U.S. companies, but it may also invest up to 20% of its assets in common stocks of foreign companies, including depositary receipts. Sector by sector, the Fund s weightings are similar to those of the S&P 500 Index. Within each sector, the Fund focuses on those equity securities that it considers most undervalued and seeks to outperform the S&P 500 through superior stock selection. By emphasizing undervalued equity securities, the Fund seeks to produce returns that exceed those of the S&P 500 Index. At the same time, by controlling the sector weightings of the Fund so they can differ only moderately from the sector weightings of the S&P 500 Index, the Fund seeks to limit its volatility to that of the overall market, as represented by this index. Derivatives, which are instruments that have a value based on another instrument, exchange rate or index, may be used as substitutes for securities in which the Fund can invest. The Fund may use derivatives, including futures contracts, options and swaps, to more effectively gain targeted equity exposure from its cash positions, to hedge various investments and for risk management. Investment Process: In managing the Fund, the adviser employs a three-step process that combines research, valuation and stock selection. The adviser takes an in-depth look at company prospects over a period as long as five years, which is designed to provide insight into a company s real growth potential. The research findings allow the adviser to rank the companies in each sector group according to their relative value. On behalf of the Fund, the adviser then buys and sells equity securities, using the research and valuation rankings as a basis. In general, the adviser buys equity securities that are identified as undervalued and considers selling them when they appear to be overvalued. Along with attractive valuation, the adviser often considers a number of other criteria: catalysts that could trigger a rise in a stock s price high potential reward compared to potential risk temporary mispricings caused by apparent market overreactions. The Fund s Main Investment Risks The Fund is subject to management risk and may not achieve its objective if the adviser s expectations regarding particular securities or markets are not met. Equity Market Risk. The price of equity securities may rise or fall because of changes in the broad market or changes in a company s financial condition, sometimes rapidly or unpredictably. These price movements may result from factors affecting individual companies, sectors or industries selected for the Fund s portfolio or the securities market as a whole, such as changes in economic or political conditions. When the value of the Fund s securities goes down, your investment in the Fund decreases in value. Mid Cap Company Risk. Investments in mid cap companies may be riskier, more volatile and more vulnerable to economic, market and industry changes than investments in larger, more established companies. The securities of mid cap companies may trade less frequently and in smaller volumes than securities of larger companies. As a result, share price changes may be more sudden or erratic than the prices of other equity securities, especially over the short term. Strategy Risk. An undervalued stock may decrease in price or may not increase in price as anticipated by the adviser if other investors fail to recognize the company s value or the factors that the adviser believes will cause the stock price to increase do not occur. Foreign Securities Risk. Investments in foreign issuers are subject to additional risks, including political and economic risks, greater volatility, currency fluctuations, higher transaction costs, delayed settlement, possible foreign controls on investment and less stringent investor protection and disclosure standards of foreign markets. Derivatives Risk. Derivatives may be riskier than other types of investments because they may be more sensitive to changes in economic or market conditions than other types of investments and could result in losses that significantly exceed the Fund s original investment. Many derivatives create leverage thereby causing the Fund to be more volatile than it would be if it had not used derivatives. High Portfolio Turnover Risk. The Fund may engage in active and frequent trading leading to increased portfolio turnover, higher transaction costs, and the possibility of increased capital gains, including short-term capital gains that will generally be taxable to shareholders as ordinary income. Redemption Risk. The Fund could experience a loss when selling securities to meet redemption requests by shareholders if the redemption requests are unusually large or frequent, occur in times of overall market turmoil or declining prices for the securities sold, or when the securities the Fund wishes to or is required to sell are illiquid. 18 J.P. MORGAN U.S. EQUITY FUNDS