Synopsis Report

“Investment and Financial Analysis of J.P. Morgan Chase & Co”

INDEX

S:NO CONTENT PAGE:NO

01 Company Introduction
02 Rationale
03 Literature Review
04 Objectives
05 Research Methodology:
✓ Research Design
✓ Nature and source of data/information to be
collected
✓ Sample and sampling technique
✓ Tools and Techniques to be used for data
collection
✓ Data handling and analysis
06 Limitation

COMPANY INTRODUCTION

JPMorgan Chase & Co., often referred to simply as JPMorgan Chase, is one of the largest and
most prominent financial institutions in the world. It's a multinational investment bank and
financial services holding company headquartered in New York City, United States. The
company traces its roots back to several prominent predecessor firms, including J.P.
Morgan & Co., Chase Manhattan Bank, Bank One, and others.

The presence of JPMorgan Chase & Co in India began in 1922, when a heritage firm took an
ownership interest in a merchant bank in Calcutta. Today, we provide clients in India a
comprehensive range of corporate and investment banking services. Our global service centers in
Mumbai, Bengaluru and Hyderabad support operations globally.

In Asia Pacific, we are committed to helping promote economic growth and economic inclusion
through our key philanthropic initiatives in the areas of workforce readiness, small business
development and financial capability. Our investments aim to increase the number of quality jobs
created for the underserved individuals and communities, helping small businesses become more
sustainable, as well as assisting marginalized people in gaining access to affordable financial
products so that they can become more financially secure.
This shared commitment to the community drives our Foundation’s giving and employee
engagement and volunteering activities across the region. J.P. Morgan is a global leader in
financial services, offering solutions to the world's most important corporations, governments
and institutions in more than 100 countries.
JP Morgan Chase & Co. is an American multinational investment bank and financial services
holding company headquartered in New York City and incorporated in Delaware. As of 2022, JP
Morgan Chase is the largest bank in the United States, the world's largest bank by market
capitalization, and the fifth largest bank in the world in terms of total assets, with total assets of
US$3.954 trillion (about $12,000 per person in the US). Additionally, JP Morgan Chase is
ranked 24th on the Fortune 500 list of the largest United States corporations by total revenue.
As a "Bulge Bracket" bank, it is a major provider of various investment banking and financial
services. It is one of America's Big Four banks, along with Bank of America, Citigroup, and
Wells Fargo.
JPMorgan Chase is a universal bank and a custodian bank. The J.P. Morgan brand is used by the
investment banking, asset management, private banking, private wealth management, and
treasury services divisions. Fiduciary activity within private banking and private wealth
management is done under the aegis of JPMorgan Chase Bank, N.A.—the actual trustee. The
Chase brand is used for credit card services in the United States and Canada, the bank's retail
banking activities in the United States and United Kingdom, and commercial banking.

Both the retail and commercial bank and the bank's corporate headquarters are currently.
located at 383 Madison Avenue in Midtown Manhattan, New York City, since the prior
headquarters building directly across the street, 270 Park Avenue, was demolished and a larger
replacement headquarters is being built on the same site. It is considered a systemically
important bank by the Financial Stability Board.

The current company was originally known as Chemical Bank, which acquired Chase Manhattan
and assumed that company's name. The present company was formed in 2000, when Chase
Manhattan Corporation merged with J.P. Morgan & Co.
J.P. MORGAN

John Pierpont Morgan Sr. (April 17, 1837 – March 31,

1913) was an American financier and investment banker who dominated corporate finance on
Wall Street throughout the Gilded Age. As the head of the banking firm that ultimately became
known as J.P. Morgan and Co., he was the driving force behind the wave of industrial
consolidation in the United States spanning the late 19th and early 20th centuries.
Over the course of his career on Wall Street, J.P. Morgan spearheaded the formation of several
prominent multinational corporations including U.S. Steel, International Harvester and General
Electric which subsequently fell under his supervision. He and his partners also held controlling
interests in numerous other American businesses including Aetna, Western Union, Pullman Car
Company and 21 railroads.
Due to the extent of his dominance over U.S. finance, Morgan exercised enormous influence
over the nation's policies and the market forces underlying its economy. During the Panic of
1907, he organized a coalition of financiers that saved the American monetary system from
collapse.

History
J.P. Morgan & Co. was one of the most influential financial institutions in the late 19th and
early 20th centuries, laying the groundwork for what would eventually become JPMorgan
Chase & Co. Here's a brief history:

1. Founding and Early Years: J.P. Morgan & Co. was founded by John Pierpont
Morgan in 1871. Morgan was a prominent financier and banker known for his role
 in shaping the American economy. The firm initially focused on investment banking,
providing financial services to large corporations and governments.
2. Consolidation and Expansion: In the late 19th and early 20th centuries, J.P.
Morgan & Co. played a significant role in financing the expansion of railroads, steel,
and other industries in the United States. Morgan was involved in numerous
mergers and consolidations, including the creation of General Electric and U.S. Steel.
3. Banking Crisis Interventions: During times of financial crisis, such as the Panic of
1907, J.P. Morgan & Co. played a pivotal role in stabilizing the financial system.
Morgan's personal influence and the reputation of his firm helped restore
confidence and prevent widespread economic collapse.
4. Antitrust Investigations: J.P. Morgan & Co. faced scrutiny from regulators over
concerns about its size and influence. In 1911, the U.S. Supreme Court ruled that the
company's control over Northern Securities violated antitrust laws, leading to the
dissolution of the company.
5. Legacy: Despite the breakup of J.P. Morgan & Co., the legacy of John Pierpont
Morgan and his firm continued to shape the financial industry. Many of the
companies formed or financed by J.P. Morgan & Co. remained influential players in
the economy.
6. Formation of JPMorgan Chase & Co.: In 2000, J.P. Morgan & Co. merged with
Chase Manhattan Corporation to form JPMorgan Chase & Co. The merger created
one of the largest and most powerful financial institutions in the world, combining
the strengths of both firms in investment banking, asset management, and retail
banking.

Rationale;
1. Financial Sector Leadership: J.P. Morgan is a global leader in the financial sector,
particularly in banking, investment banking, asset management, and other financial
services. Its activities and decisions significantly impact global financial markets,
making it relevant to investors, policymakers, and economists.
2. Systemic Importance: As one of the largest and most influential banks in the world,
J.P. Morgan's stability and performance are critical for the stability of the financial
system. Its actions can have far-reaching consequences, as demonstrated during the
2008 financial crisis when it played a central role in stabilizing the financial
markets.
3. Innovation and Technology: J.P. Morgan is at the forefront of financial innovation
and technology, developing and implementing cutting-edge solutions such as
blockchain technology, artificial intelligence, and data analytics. Its initiatives in
 fintech and digital transformation have implications for the entire financial industry
and beyond.
4. Corporate Governance and Ethics: Given its prominence, J.P. Morgan's corporate
governance practices and ethical conduct are closely scrutinized. Its approach to
risk management, compliance, and corporate responsibility sets standards for the
industry and influences regulatory policies.
5. Economic Indicators: J.P. Morgan's performance and activities serve as important
indicators of broader economic trends and market sentiment. Analysts often
monitor its financial results, lending practices, and investment strategies to gauge
the health of the economy and financial markets.
6. Employment and Career Opportunities: J.P. Morgan's extensive global presence
creates employment opportunities for a diverse range of professionals, including
bankers, traders, analysts, technologists, and support staff. Its recruitment practices
and workforce policies impact the labor market and talent development strategies.
7. Global Impact: With operations spanning multiple countries and regions, J.P.
Morgan's activities have a global impact on economies, financial systems, and
societies worldwide. Its role in facilitating cross-border transactions, financing
infrastructure projects, and supporting international trade contributes to global
interconnectedness and development.
8. Historical Legacy: J.P. Morgan has a rich historical legacy dating back to the 19th
century, including its role in financing industrial expansion, supporting government
initiatives, and shaping economic policies. Understanding its history provides
insights into the evolution of modern finance and capitalism.

LITERATURE REVIEW
A) Introduction to Finance and Financial Analysis:
"Finance" refers to the management of money and other assets, including the
processes of investing, lending, borrowing, budgeting, saving, and risk management.
It encompasses a broad range of activities and concepts related to the allocation and
utilization of funds to achieve specific objectives, whether personal, corporate, or
governmental.
Financial Institutions
Financial institutions include banks and other non-finance banking institutions. It is a company
that is engaged in the business of dealing with monetary and financial transactions like loans,
deposits, and investments.
Financial Services
The economic services that are provided by financial institutions and cover a broader aspect of
money like managing money, banks, credit cards, debit cards are called financial services.
Also, the other financial services that are offered by the institutions are consumer finance, stock
brokerage, investment funds, and many more.
Financial Metrics

Financial Markets
Financial markets consist of 2 types of market, primary market, and secondary market. This is a
broad term used to describe a marketplace where equities, currencies, and bonds are traded. So,
in the primary market, the exchange for the government and companies is done by the new
companies.
Financial Instruments
Financial instruments are the assets which can be traded in the market. They can also be a form
of package which is traded. Most financial instruments provide an efficient flow to facilitate the
transfer of capital.
Public finance
Corporate finance
Personal finance
Public Finance
The federal government helps prevent market failure by overseeing the allocation of resources,
distribution of income, and stabilization of the economy. Regular funding for these programs is
secured mostly through taxation. 19 Borrowing from banks, insurance companies, and other
governments and earning dividends from its companies also help finance the federal government.
Corporate Finance
Businesses obtain financing through a variety of means, ranging from equity investments to
credit arrangements. A firm might take out a loan from a bank or arrange for a line of credit.
Acquiring and managing debt properly can help a company expand and become more profitable.

Personal Finance
Personal financial planning generally involves analyzing an individual's or a family's current
financial position, predicting short-term, and long-term needs, and executing a plan to fulfill
those needs within individual financial constraints. Personal finance depends largely on one's
earnings, living requirements, and individual goals and desires.
The most important aspects of personal finance include:
Assessing the current financial status: expected cash flow, current savings, etc.
Buying insurance to protect against risk and to ensure one's material standing is secure
Calculating and filing taxes
Savings and investments
Retirement planning
Revenue Growth

Stock Price Statistics

The stock price has increased by +37.20% in the last 52 weeks. The beta is 1.12, so JPM's
price volatility has been higher than the market average.

Beta (1Y) 1.12

52-Week Price Change +37.20%
50-Day Moving Average 189.22
200-Day Moving Average 163.59
 Relative Strength Index (RSI) 55.55
Average Volume (30 Days) 8,943,140

Introduction to Financial Analysis

Financial analysis, on the other hand, is the process of evaluating the financial health and
performance of an individual, company, or other entity by examining its financial
statements and other relevant data. The goal of financial analysis is to assess the entity's
profitability, liquidity, solvency, efficiency, and overall financial stability.

Financial analysis involves various techniques and methods, including:

7. Ratio Analysis: This involves calculating and analyzing financial ratios, such as
profitability ratios (e.g., return on investment, profit margin), liquidity ratios (e.g.,
current ratio, quick ratio), and leverage ratios (e.g., debt-to-equity ratio, interest
coverage ratio). Ratios provide insights into different aspects of a company's
financial performance and position.
8. Trend Analysis: Trend analysis involves examining financial data over multiple
periods to identify patterns and trends. This helps in understanding how key
financial metrics have changed over time and predicting future performance.
9. Cash Flow Analysis: Cash flow analysis focuses on evaluating the cash inflows and
outflows of an entity over a specific period. It helps assess the entity's ability to
generate cash and meet its financial obligations.
10. Financial Statement Analysis: Financial statement analysis involves reviewing the
income statement, balance sheet, and cash flow statement to assess the entity's
financial performance and position. This includes analyzing revenue trends, expense
management, asset utilization, and debt management.
11. Comparative Analysis: Comparative analysis involves comparing the financial
performance and position of an entity with that of its peers or industry benchmarks.
This helps identify strengths, weaknesses, opportunities, and threats relative to
competitors.
Short Selling Information
The latest short interest is 21.78 million, so 0.76% of the outstanding shares have been sold
short.

Short Interest 21.78M

Short Previous Month 18.81M
Short % of Shares Out 0.76%
Short % of Float 0.76%
Short Ratio (days to cover) 2.63
Income Statement
In the last 12 months, JPM had revenue of $158.10 billion and earned $47.76 billion in
profits. Earnings per share was $16.23.

Revenue 158.10B
Gross Profit 158.10B
Operating Income 70.93B
Pretax Income 59.82B
Net Income 47.76B
EBITDA 67.33B
EBIT 59.82B
Earnings Per Share (EPS) $16.23

Meaning of Investment Analysis

Investment analysis is a broad term for many different methods of evaluating investments,
industry sectors, and economic trends. It can include charting past returns to predict future
performance, selecting the type of investment that best suits an investor's needs, or evaluating
individual securities such as stocks and bonds to determine their risks, yield potential, or price
movements.
Understanding Investment Analysis
The aim of investment analysis is to determine how an investment is likely to perform and how
suitable it is for a particular investor. Key factors in investment analysis include the appropriate
entry price, the expected time horizon for holding an investment, and the role the investment will
play in the portfolio.
Strategic Thinking
Investment analysis can also involve evaluating an overall investment strategy in terms of the
thought process that went into making it, the person's needs and financial situation at the time,
how the portfolio performed, and whether it's time for a correction or adjustment. Investors who
are not comfortable doing investment analysis on their own can seek advice from an investment
advisor or another financial professional.
Types of Investment Analysis
While there are countless ways to analyze securities, sectors, and markets, investment analysis
can be divided into several basic approaches.
Top-Down vs. Bottom-Up
When making investment decisions, investors can use a bottom-up investment analysis approach
or a top-down approach.
Bottom-up investment analysis entails analyzing individual stocks for their merits, such as their
valuation, management competence, pricing power, and other unique characteristics.
Bottom-up investment analysis does not focus on economic cycles or market cycles. Instead, it
aims to find the best companies and stocks regardless of the overarching trends. In essence,
bottom-up investing takes a microeconomic approach to investing rather than a macroeconomic
or global approach.
Top-Down and Bottom-Up Examples
In a top-down approach, an investor might evaluate various sectors and conclude that financials
will likely perform better than industrials. As a result, the investor decides the investment
portfolio will be overweight financials and underweight industrials. Then it's time to find the best
stocks in the financial sector.

Technical Analysis
The technical analyst evaluates patterns of stock prices and statistical parameters, using
computer-calculated charts and graphs. Unlike fundamental analysts, who attempt to evaluate a
security's intrinsic value, technical analysts focus on patterns of price movements, trading
signals, and various other analytical charting tools to evaluate a security's strength or weakness.
Day traders make frequent use of technical analysis in devising their strategies and timing their
buying and selling activity.

The Quantitative Analysis

The third method used in investment analysis is called quantitative analysis or quant for short.
The goal of this type of analysis is to understand how a company’s management team can
maximize shareholder value.
The analyst will look at the business operations from different angles, including capital
expenditure, working capital management, and cash flow. The quant analyst looks for strong net
income, high operating margins, and low debt relative to assets.

Importance of Investment Analysis

Investment analysis is essential because it helps you make informed investment decisions that
can minimize the risk of loss and increase your return potential.
The relevance of using investment analysis is better understood through a real-world example of
investment analysis.
Investment Analysis Process
The four stages
Stage 1 is pure performance analysis and is what most clients are solely focused on. It concerns
the overall return result and perhaps the volatility. But whilst performance is typically a primary
target, performance numbers alone provide little insight into whether an investment is truly good
or bad. Looking only at performance often leads towards bad investment behavior's, such as
selling low and buying high.
I would argue that most of the investment advisory community are at Stage 2, which is the
assessment of the quality of an investment by comparing it with a benchmark which often leads
to the conclusion that outperformance is good and underperformance is bad. The choice of the
benchmark is a critical part of this analysis and where most mistakes are made at
Stage 2. Sometimes the benchmark is a peer group, which may be fine depending on the
investment type, but best practice suggests a benchmark should be a liquid representation of the
underlying investment universe – typically a market-cap weighting of available investments.
Common benchmarks include the S&P/ASX 200 for Australian equities or MSCI World Index
for global equities.
At Stage 3, analysts adjust for market risk and divide the portfolio’s risk into the two
components we hear so much about alpha and beta. Alpha is the market risk-adjusted
outperformance often associated with measures of active management skill. Beta represents a
strategy’s exposure to the market. For the above-mentioned geared Australian equities index
example, the alpha should be slightly negative and close to the cost of the fund, whilst the beta
(thanks to a loan-to-value ratio of 50 per cent), should be up to 2 which represents twice the
market exposure (or risk). Whilst the geared index strategy has strong outperformance, its
negative alpha suggests there is no skill because the return has driven by having double the
market exposure.

Stage 4 is where the Future Fund has arrived, along with many other institutions and
sophisticated investment professionals. This stage further adjusts for non-market systematic
risks, which are typically represented by the smart betas, which can be purchased somewhat
cheaply. In English, typical smart beta exposures may include style indices such as value (for
example, low PE ratios), size (for example, small caps), momentum (for example, last year’s best
performers), quality (for example, high profitability and low debt), and others.
Reflect one’s investment philosophy with demonstrated characteristics around desired styles
that are expected to outperform (smart betas/factors)
Reflect the desired asset allocation with demonstrated market exposure that is likely to
continue (market beta)
Have active managers with potential skill demonstrated by positive risk-adjusted
outperformance (multi-factor alpha)
Demonstrate a strategy is ―true to label‖; that is, the strategy’s market beta and smart beta
exposures are consistent with the investment process the manager has communicated

OBJECTIVE OF THE STUDY

✓ 1. To study the investment analysis of J.P. Morgan company.
✓ 2. To determine how an investment is likely to perform and how key factors in
investment analysis include the appropriate entry price, the expected time horizon for
holding an investment.
✓ 3. To know the role of investment which would play in the portfolio.
✓ 4. To know the appropriate entry price, the expected time horizon for holding an
investment, and the role the investment will play in the portfolio.
✓ 5. To know the profitability & growth of the company.
✓ Financial Performance: Continuously strive to achieve strong financial results,
including revenue growth, profitability, and shareholder returns, while effectively
managing risks.

✓ 6. Delivering exceptional client service; acting with integrity and responsibility;

and supporting the growth of our employees.
✓ 7. Providing investment banking solutions, including M&A, capital raising and risk
management, for a broad range of corporations, institutions and governments.
✓ Expansion and Market Leadership:
✓ Sustainability and ESG (Environmental, Social, and Governance) Goals:

RESEARCH METHODOLOGY
Primary data: Primary data was collected from the JP Morgan official website & the
information was imported.
This report has been prepared through extensive use of primary data. It is collected from a group
of people who are related to this company. The following method is used in collecting primary
data. Data used in research was originally obtained through the direct efforts of the research.

Secondary data: The basic data for this current study has been collected from the Internet,
Books, Journals and Electronic database.

Secondary data is collected from the company’s collected from the company’s manuals report
and brochures through company’s records. Secondary data can be collected through references as
websites, journals, books, magazines etc.

J.P. Morgan produces proprietary index products that track emerging markets, government debt,
and corporate debt asset classes. The Global Index Research group develops index products
comprising tradable strategies, ETFs/ETNs, Credit, and Commodities. Index products and
research provide analytics to evaluate client portfolios. The indices define and increase the
visibility of the asset classes they represent and provide a tool to measure the performance of the
asset class.

♦ Tools and Techniques to be used for data collection

✓ Case studies and stories of change:
✓ Surveys and questionnaires:
✓ Photography and video:
✓ Observation
✓ Interviews,
Focus groups, and forms
Internal sources
✓ External sources
✓ Government publications
✓ Non-government publications

HYPOTHESIS
Hypothesis Number 01: -
Null Hypothesis: H0: There is no statistical relationship and significance that exists in a set of
given single observed variable, between two sets of observed data and measured phenomena.

Alternative Hypothesis: H1: There is a statistical relationship and significance that exists in a
set of given single observed variables, between two sets of observed data and measured
phenomena.

Hypothesis Number 02: -

 Null Hypothesis: H0: There is no similar profit in 2 years.

Alternative Hypothesis: H1: There is a similar percentage ratio in operating & pretax margin
from the 5-year data.

Limitation's
Sometimes an investment is less profitable when there is downflow of market, it is observed
during covid pandemic.
This study is based on only secondary data; the limitations of the secondary data would have
affected the study.
Ratios are computed based on financial statements of the selected companies.
Hence, the future performance of these units will not reflect. The financial statements are
subject to window dressing by the corporation.
It will affect the results in the process of analysis.
The absolute figures may prove decorative as ratio analysis is primarily quantitative analysis
and not qualitative analysis. Many people may interpret the results in different ways as ratio is
not an end by itself.

Bibliography:
Magazines
Business world
India Today
Books Referred:
Financial Management by I.M. Pandey,
Websites
https://www.jpmorgan.com/global
https://in.investing.com/
https://stockanalysis.com
https://medium.com/
https://www.sec.gov/