Investment Strategies

Investment focus

Our business model encompasses the specialist skills and expertise of eight distinct investment firms, each with its own unique approach, philosophy, process, and culture. BNY Mellon Investment Management provides the operational infrastructure, distribution, support, assistance, and global influence. Our best of both worlds approach – specialisation wedded to scale – provides our clients access to a comprehensive range of investment capabilities, covering every major global asset class.

These strategies are available on a separate account basis and/or through a UCITS fund. Our European fund ranges utilise the wider investment powers permitted under the UCITs regulations enabling us to extend our offering to include funds that encompass hedge fund style investment strategies with daily pricing and liquidity.

Investment Managers are appointed by BNY Mellon Investment Management EMEA Limited (BNYMIM EMEA), BNY Mellon Fund Management (Luxembourg) S.A. (BNY MFML) or affiliated fund operating companies to undertake portfolio management activities in relation to contracts for products and services entered into by clients with BNYMIM EMEA or the BNY Mellon funds.

Key
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Fund of funds

CAPABILITIES
Equity
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Absolute Return Absolute return funds aim to deliver a positive return regardless of market conditions, although this is not guaranteed. They do this by balancing traditional longer-term equity investments with other investment techniques, with the aim of continuing to generate a positive return even when the value of a market falls.
Asia Pacific (ex Japan) Asia Pacific ex-Japan Equity strategy invests primarily in the stocks of companies in the Asia Pacific Basin (excluding Japan) region.
Brazilian Brazilian Equity strategy invests primarily in the stocks of companies in Brazil and Latin America.
Emerging Markets Emerging Market Equity strategy invests primarily in the stocks of companies in Emerging Markets.
Risk ParityEuropean (inc. & ex. UK) The European Equities strategy invests primarily in the stocks of companies in Europe (including and excluding UK).
Global The Global Equities strategy invests primarily in the stocks of companies globally.
REIT – Real Estate A real estate investment trust is a closed-end investment company that owns assets related to real estate such as buildings, land and real estate securities. REITs sell on the major stock market exchanges just like common stock.
Socially Responsible Responsible investment is an investment strategy which seeks to generate both financial and sustainable value. It consists of a set of investment approaches that integrate environmental, social and governance (ESG) and ethical issues into financial analysis and decision-making.
Small/Mid Cap Small Cap refers to stocks with a relatively small market capitalisation. Mid cap refers to a company with a market cap between US$2 and US$10 billion.
UK The UK Equities strategy invests primarily in the stocks of companies in the UK.
US The US Equities strategy invests primarily in the stocks in companies in North America.
Fixed Income
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Absolute Return Absolute return portfolios seek to make positive returns irrespective of the market conditions. This helps to smooth investment returns, while also improving the portfolio’s return potential.
Brazilian Bonds The Brazilian Bonds strategy invests primarily in the stocks in companies in Brazil and Latin America.
Convertibles Convertible bonds are debt securities that provide the holder with an option to convert the instrument into the issuer’s stock at a predetermined price.
Emerging Markets The Emerging markets strategies focus on traditional fixed income investments in markets outside of the United States and Western Europe, including Asia and Latin America as well as Eastern Europe, Africa and the less developed Mediterranean economies.
European The European bonds strategy invests primarily in companies in Europe (including and excluding UK).
Global The Global bonds strategy invests primarily in companies globally.
Inflation Linked The Inflation-linked bonds offer investors the opportunity to protect the real value of both the capital value of their investments and the income they generate.
Mezzanine Finance Mezzanine loans are a hybrid floating-rate product filling the funding gap between senior secured debt and equity. They are typically secured on the assets of the borrower albeit in a junior position to Senior Secured Loans.
Structured Notes / ABS A structured note can provide a certain amount of capital protection along with the flexibility to redeem your note prior to maturity. Constructed in such a way that your capital is protected up to a certain percentage, or not at all. Asset Backed Securities is a security whose income payments is derived from and collateralised by a specified pool of underlying assets.
UK The UK bond strategy invests in companies in the UK.
US The US bond strategy invests in companies in the US.
Senior Secured Loans Secured loans are loans generally made to non-investment grade borrowers. They are typically senior instruments, secured by a substantial proportion of the borrower’s assets, and rank ahead of junior loans and unsecured debt in the corporate capital structure.
Short Duration / Intermediate A Short duration strategy is an aspect of reducing bond exposure to interest rate risk, and in turn, in limiting potential capital losses.
Alternatives
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Agriculture Investing in agricultural companies who in turn offer exposure to the structural expansion in food production required to cope with ever increasing global demand.
Commodities A raw material or primary agricultural product that can be bought and sold, such as copper or coffee. While they can be traded on either spot (real-time) or futures (options) markets, most individual commodities are traded in the form of futures, where what is being traded is not the commodity itself but rather a contract to buy or sell it for a certain price by a stated date in the future.
Currency A high liquid, low volatility asset class with exposure to a wide range of currencies.
Direct lending The transfer of funds from the ultimate lender to the ultimate borrower, most often through a third party.
Distressed A financial instrument in a company that is near or is currently going through bankruptcy. This usually results from a company’s inability to meet its financial obligations. As a result, these financial instruments have suffered a substantial reduction in value. Distressed securities can include common and preferred shares, bank debt, trade claims (goods owed) and corporate bonds.
Emerging Markets Private Equity An asset class consisting of equity securities and debt in Emerging Market operating companies that are not publicly traded on a stock exchange.
Event-Driven A hedge fund asset class that seeks to exploit pricing inefficiencies that may occur before or after a corporate event, such as an earnings call, bankruptcy, merger, acquisition, or spinoff.
Global Macro Global macro invests on a large scale around the world based on economic theory.It is typically based on forecasts and analysis about interest rate trends, the general flow of funds, political changes, government policies, inter-government relations, and other broad systemic factors.
Hedge Funds Alternative investments using pooled funds that may use a number of different strategies in order to earn active return, or alpha, for their investors.
Long / Short / Market Neutral Bonds Seeks to profit from both increasing and decreasing prices in a bond markets by taking matching long and short positions in different stocks to increase the return from making good stock selections and decreasing the return from broad market movements.
Long / Short / Market Neutral Equity Seeks to profit from both increasing and decreasing prices in a equity markets by taking matching long and short positions in different stocks to increase the return from making good stock selections and decreasing the return from broad market movements.
Multi Strategy A combination of alternative asset classes (such as cash, equity or bonds) used as an investment.
Overlay / Futures / Swaps An overlay is a management style that hamonises an investor’s seperatley managed accounts, preventing the formation of inefficiencies. Futures are a financial contract obligating the buyer to purchase an asset ast a predetermined date in the future. A swap is an agreement between two parties to exchange sequences of cash flows for a set period of time.
Portable Alpha The return of an investment portfolio with zero market risk (beta). Being independent of both the direction and the magnitude of the market’s movements, it represents the manager’s skill in selecting investments.
Private Equity / VC Loans An asset class consisting of equity securities and debt in operating companies that are not publicly traded on a stock exchange. A private equity investment will generally be made by a private equity firm, a venture capital firm or an angel investor.
Listed Infrastructure An asset class that provides investors with access and diverse exposure to global infrastructure such as rail, airports, water, gas, electricity and energy.
Multi-Asset
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Absolute Return Seeks to make positive returns by employing investment management techniques that differ from traditional mutual funds.
Global A combination of global asset classes (such as cash, equity or bonds) used as an investment.
Regional A combination of regional asset classes (such as cash, equity or bonds) used as an investment.
Tactical Asset Allocation A dynamic investment strategy that actively adjusts a portfolio’s asset allocation. The goal of a TAA strategy is to improve the risk-adjusted returns of passive management investing.
Risk Parity Risk Parity.
Money Markets
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Euro An asset class investing in euro denominated short-term debt securities.
Sterling An asset class investing in sterling denominated short-term debt securities.
US An asset class investing in dollar denominated short-term debt securities.
Bespoke offering
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Beta Smart beta strategies attempt to deliver a better risk and return trade-off than conventional market cap weighted indices by using alternative weighting schemes based on measures such as volatility or dividends.
Dynamic Hedge Strategies (CPPI) Widely used by derivatives dealers to hedge gamma or vega exposures. As it involves adjusting a hedge as the underlier moves, often several times a day, it is considered dynamic.
Insurance client workout Addresses insurance clients specific liability and operating objectives, risk tolerance, tax circumstances and regulatory requirements.
Liability Driven Investment Cash flows needed by a company or individual to fund future liabilities.
Structured Products Pre-packaged, based on derivatives, such as a single security, a basket of securities, options, indices, commodities, debt issuance and/or foreign currencies, and to a lesser extent, swaps.

The value of investments can fall. Investors may not get back the amount invested.
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