BNY Mellon Asset Management Launches Investment Strategy To Manage Inflation Risk
February 03 2010 - 7:27AM
PR Newswire (US)
Global liquidity, low interest rates, global growth combine to
raise concern BOSTON, Feb. 3 /PRNewswire-FirstCall/ -- BNY Mellon
Asset Management has launched the Real Asset Strategy, an
institutional investment strategy designed for periods of rising
inflation that aims to achieve long-term returns of five percent
above the Consumer Price Index in the U.S. "Massive amounts of
global liquidity combined with record low interest rates and
renewed signs of global growth are driving an increasing number of
institutions to examine their exposure to the threat of inflation,"
said Jeffrey B. Saef, director, multi-strategy investment solutions
for BNY Mellon Asset Management "Many endowments, foundations and
pension plans have not positioned themselves adequately to protect
their portfolios against inflation," said Saef. "While the threat
of inflation is not immediate, institutions need to position their
portfolios before inflation becomes a factor, or they will pay too
much for inflation-hedging assets that we expect will quickly rise
in value." The Real Asset Strategy invests in inflation-sensitive
equities, inflation-linked bonds and actively managed commodities.
These types of investments historically have produced returns above
the rate of inflation during past periods of rising inflation.
"Given our global multi-boutique structure, BNY Mellon Asset
Management is well positioned to build a portfolio of diversified
asset classes that are designed to correlate well with inflation
while providing good diversification to traditional asset classes,"
said Saef. The typical, strategic long-term weighting of assets in
the Real Asset Strategy is: -- 25 percent in global
inflation-protected securities - These include U.S. TIPs (Treasury
Inflation-Protected Securities) as well as similar securities
issued in other countries managed by Standish Mellon Asset
Management Company LLC. -- 35 percent in a commodity alpha
long-bias strategy -This is a risk-controlled commodities strategy
with a volatility target of 10 percent that is managed by Mellon
Capital Management. -- 30 percent in global equities of natural
resources companies - These investments are managed by The Boston
Company Asset Management LLC (TBCAM). -- Five percent in equities
of companies in emerging markets - These investments also are
managed by TBCAM. -- Five percent in global real estate securities
- These investments are managed by Urdang Securities Management,
Inc. "As part of the Real Asset Strategy, BNY Mellon Asset
Management intends to periodically review, and adjust if warranted,
the allocations among these asset classes within a controlled range
to take advantage of dislocations and opportunities in the
marketplace," concluded Saef. Currently, the Real Asset Strategy is
available to certain qualified institutions who become clients of
The Bank of New York Mellon. Also, the underlying asset classes are
managed by employees of these BNY Mellon Asset Management firms
acting in their dual capacities as officers of The Bank of New York
Mellon. Past performance is no guarantee of future results. This is
not intended as an offer to sell or solicitation of an offer to buy
any security, and the information herein should not be construed as
investment advice. The investment products or services discussed
herein are not insured by the FDIC or any other governmental
entity, are not guaranteed by any bank, and may lose value. Notes
to Editors: BNY Mellon Asset Management is the umbrella
organization for BNY Mellon's affiliated investment management
firms and global distribution companies. BNY Mellon is the
corporate brand of The Bank of New York Mellon Corporation
(NYSE:BK). BNY Mellon is a global financial services company
focused on helping clients manage and service their financial
assets, operating in 34 countries and serving more than 100
markets. BNY Mellon is a leading provider of financial services for
institutions, corporations and high-net-worth individuals,
providing superior asset management and wealth management, asset
servicing, issuer services, clearing services and treasury services
through a worldwide client-focused team. It has $22.3 trillion in
assets under custody and administration, $1.1 trillion in assets
under management, services $12.0 trillion in outstanding debt and
processes global payments averaging $1.6 trillion per day.
Additional information is available at http://www.bnymellon.com/.
All information source BNY Mellon Asset Management as at December
31, 2009. This press release is qualified for issuance in the US
only and is for information purposes only. It does not constitute
an offer or solicitation of securities or investment services or an
endorsement thereof in any jurisdiction or in any circumstance in
which such offer or solicitation is unlawful or not authorized.
This press release is issued by BNY Mellon Asset Management to
members of the financial press and media and the information
contained herein should not be construed as investment advice. Past
performance is not a guide to future performance. A BNY Mellon
Company(SM) DATASOURCE: BNY Mellon CONTACT: Mike Dunn,
+1-212-922-7859, Web Site: http://www.bnymellon.com/
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