BNY Mellon pursues launch despite bubble fears

BNY Mellon plans to bring Brazilian, emerging market debt and global real estate funds to British investors even as investors fear a bubble in global emerging market assets.

Paul Feeney, the head of international distribution at BNY Mellon Asset Management, says: “Emerging market debt has been seen as a peripheral asset class, but that’s changing. Developing countries issuing debt in local currencies has been seen as a risk but it is actually a more secure investment.

“We have an emerging market debt fund in our Dublin range, which we want to make available to British investors.

“We are also looking to bring our global real estate fund to onshore clients as we think there will be increased interest in the asset class.”

BNY Mellon is also poised to add a sterling share class to a Brazil fund, despite capital controls in Brazilian markets and a soaring local currency. (article continues below)

HSBC Global Asset Management last week said it would adjust net asset value per share by up to 7% in its Brazil Bond, Brazil Equity, Latin American Equity and Latin American Local Debt fund to guard against financial transaction taxes in Brazil.

The country has used the taxes to help control inflows and dampen its runaway popularity with investors.

In February, HSBC had introduced flexible net asset value per share arrangements to help protect investors in its funds.