(Boursier.com) — BNY Mellon Investment Management, one of the largest asset managers in the world with $1.9 trillion in assets under management, announces the launch of the BNY Mellon Floating Rate Credit Fund.
The Fund is managed by Insight Investment (Insight), a global asset manager with assets under management of €733.9 billion including €218.4 billion in bond assets. It invests primarily in variable rate corporate bonds and aims to generate income while providing protection against rate volatility. It meets the requirements of Article 8 of the EU Regulation on sustainability reporting in the financial services sector.
As floating rate bonds have lower sensitivity to changes in interest rates than fixed rate bond instruments, this asset class is therefore likely to offer investors an attractive risk/reward combination with similar returns to those of loans and lower capital volatility in a context of rising rates. Targeting variable rate debt creates opportunities in the current context marked by an inverted yield curve…
The fund management team is led by Ulrich Gerhard, senior portfolio manager, supported by Cathy Braganza and Lorraine Specketer, portfolio managers. A now well-established team with over 25 years of industry experience and deep expertise in high yield bonds, loans and bottom-up credit analysis, and also manages the BNY Mellon Global Short-Dated High Yield Bond Fund. This fund, launched in 2016, has attracted great interest from investors, as evidenced by the $708.7 million in assets under management. The management team benefits from the expertise of Insight’s fixed income teams, made up of 166 investment professionals located around the world.
Ulrich Gerhard, High Yield Manager at Insight Investment said: “We favor sectors that we believe have attractive valuations, stable competitive environments and high barriers to entry. We target issuers that stand out with a robust business model and capital structure that generates regular cash flows, implying a clear repayment schedule and reduced default risk.”
Bottom-up
Anne-Laure Frischlander-Jacobson, Managing Director France, Belgium, Luxembourg and Israel of BNY Mellon Investment Management, adds: “Insight’s strategy emphasizes bottom-up credit analysis and cash flow generation. It is implemented by a management team with extensive experience. The team uses qualitative and quantitative approaches to identify sources of outperformance at the sector, issuer and security level.”
The Fund, part of the BNY Mellon Global Funds, plc range, domiciled in Ireland, is authorized for sale in Austria, Belgium, Denmark, Finland, France, Germany, Italy, Luxembourg, Netherlands, Norway, Sweden, Switzerland, Spain and the United Kingdom.
Investment objective : Aims to generate absolute performance comprised of income and capital growth by investing in variable rate debt and debt-related securities as well as financial derivative products of a similar nature.
Benchmark: The Fund will measure its performance against the 3-month EURIBOR. EURIBOR (Euro Interbank Offer Rate) is a reference rate corresponding to the average interest rate charged by banks in the euro zone on the interbank market for unsecured short-term loans. The Monetary Index constitutes an objective against which the performance of the fund is measured over an annualized and rolling 3-year period, net of fees.
The fund is actively managed, which means that the Manager selects investments at its sole discretion, based on the investment objectives and policy. The Benchmark Index is a monetary index that is insensitive to ESG factors. It is not used to determine the extent to which the environmental and social characteristics promoted by the fund are taken into consideration.