BNY Mellon has expanded its Asian Income Fund to Hong Kong retail investors, according to a company announcement.
The fund was initially launched in other countries in May 2014 and focuses on “good quality companies paying a healthy level of dividends”.
“Recession in developed markets is definitely a big question now given that we are still seeing the delayed effect of the monetary policy increases in the interest rate, but we are reevaluating how households and corporates react when they refinance,” Zoe Kan, lead manager for the BNY Mellon Asian Income Fund, told FSA in an interview.
“That makes our job tougher and we are looking for companies that are more recession proof. The nature of business models which we invest in have very healthy balance sheet. A lot of the companies that we own are net cash or have a minimal level of gearing.”
The investment team consists of six people, supported by a team of global industry researchers.
The fund invests 33.7% in the financials sector, 23.4% in the technology sector and 9.5% in the industrials sector.
Its top three geographical allocations are Singapore (18.2%), Australia (14.8%) and Hong Kong (13.4%).
“We have a larger allocation historically towards developed parts of Asia, the likes of Australia, New Zealand, Singapore, Hong Kong and Taiwan, where governance standards are better and more dividend paying companies there,” said Kan.
“We have not invested in Chinese financials because we are concerned about the balance sheet quality. The Chinese banks do not give us the same level of comfort as we get in other countries like Singapore,” she said.
Also, she believes the banking industry structure is better in places such as Singapore rather than China.
BNY Mellon now offers four equity income funds to Hong Kong retail investors, including the BNY Mellon Global Equity Income Fund, the BNY Mellon US Equity Income Fund and the BNY Mellon Global Infrastructure Income Fund.