JPMorgan is offering rich clients a way to ride the market waves created by massive investors

People walk past a branch of Chase Bank in New York on Jan. 14, 2015.

JPMorgan Chase plans to offer its wealthy clients access to a stock strategy typically limited to institutional managers, offering them a chance to ride the wave created by a massive inflow of investors, Bloomberg first reported.

The bank has issued $15 million of structured notes that will allow clients to analyze trading patterns caused by big investors in the S&P 500 under the assumption that these whales may give rise to a new trend or create momentum, according to Bloomberg.

The notes offered by the bank, which carry maturities of up to five years, track the performance of the bank’s Kronos+ index that launched in December 2020, an SEC filing first viewed by Bloomberg showed. Kronos+ thus far has outperformed the benchmark.

According to the Bloomberg report, the gauge of the market tracked by the Kronos+ index hasn’t seen a loss since 2008, when it dropped 54%.

The newly available strategy is among the several that big-league clients can utilize to make sense of the market, especially during bouts of volatility.

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Bank stocks tumble as yields falling from 14-month high pause interest-income optimism

Wells Fargo ATM
A row of Wells Fargo ATMs.

  • Bank of America, Wells Fargo and other bank stocks fell Monday as the 10-year Treasury yield declined.
  • The closely watched yield tied to a range of lending programs fell about 5 basis points from a 14-month high.
  • The SPDR S&P Bank ETF lost 3% on Monday, marking a second straight loss.
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Bank stocks dropped Monday, with a widely watched bank ETF pulling further away from a 13-year high as borrowing costs tracked by the 10-year Treasury yield edged lower.

Bank stocks in recent sessions have been gaining as the 10-year Treasury yield and other long-dated yields rise while investors price in expectations of stronger inflation as the economy recovers from the COVID-19 pandemic. Banks seeking to lend money can see interest income improve when long-dated yields rise.

The 10-year yield, which is tied to lending programs including mortgages and auto loans, fell Monday by nearly 5 basis points to 1.68% from 1.73% on Friday when it reached its highest since January 2020.

Shares of Bank of America declined 2.6%, Citigroup fell 1.4%, JPMorgan shares of JPMorgan Chase lost 3.3% Wells Fargo declined by 1.7%.

Those moves also contributed to pressure on the SPDR S&P Bank ETF on Monday. It slumped 3% to mark a second straight loss. The index fell on Friday after the Federal Reserve decided to let a rule expire that relaxed capital requirements to encourage bank lending during the COVID-19 crisis. The rule change for the supplementary leverage ratio, or SLR, will expire as scheduled on March 31.

With the recent run higher in bank stocks, the SPDR S&P Bank ETF on March 12 logged its highest settlement since September 2007.

Meanwhile, the 10-year yield has climbed from around 0.9% since the start of 2021.

“While such a percentage increase in yield is dramatic from a percentage point of view the likely reality is that the move in yields may suggest that ‘things’ are indeed ‘getting better’ and pointing toward re-openings in areas of the US economy that have been shuttered or near shuttered for much of the duration since the rise of the pandemic last year,” wrote John Stoltzfus, chief investment strategist at Oppenheimer Asset Management, in a note Monday.

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