Dreyfus Emerging Markets Debt U.S. Dollar Fund is Newest Fund in Emerging Markets Debt Suite
The Dreyfus Corporation (Dreyfus), a BNY Mellon company, announced today that it has launched the Dreyfus Emerging Markets Debt U.S. Dollar Fund, an actively managed mutual fund. The fund's objective is to seek to maximize total return by investing in emerging market bonds and other debt instruments denominated in U.S. dollars including debt issued from government, government-related and corporate issuers.
"The expanding prominence of emerging economies caused by powerful demographic trends and fundamental improvements has attracted increasing global interest as investors seek enhanced income, growth and diversification opportunities," said Kim Mustin, BNY Mellon Investment Management's Head of North American Distribution. "Advancements in the asset class have created distinct investment opportunities for U.S. dollar and locally-denominated debt. We are pleased to add the new U.S. dollar-denominated fund to our existing emerging market debt products, such as the Emerging Market Local Currency Debt Fund and Opportunistic Emerging Markets Debt Fund."
The Fund is sub-advised by Standish Mellon Asset Management Company LLC, and is managed by Alexander Kozhemiakin, head of the emerging market debt team and senior portfolio manager at Standish and Cathy Elmore, emerging market debt portfolio manager at Standish.
The Fund's portfolio managers are supported by a dedicated team of traders and research analysts with an average of more than 14 years of industry experience and responsibility for managing approximately $12 billion in dedicated emerging markets assets. The Fund's managers employ an active investment process that uses in-depth fundamental country and credit analysis. A "top down" analysis of macroeconomic, financial and political variables guides country allocation, while a "bottom-up" analysis of the fundamental measures of an issuer's creditworthiness guides securities selection.
"We are encouraged by long-term growth prospects and moderate indebtedness of many emerging market countries as well as by business prospects of their companies," said Kozhemiakin. "In general, we believe the asset class offers attractive risk/return opportunities. However, careful selection of sovereign and corporate opportunities is key, as different emerging market issuers have different credit trajectories."
"We believe that the Fund will be attractive to investors who are looking for a diversified way to seek to take advantage of quality sovereign and corporate opportunities in emerging markets, without subjecting themselves to the heightened volatility generally associated with local-currency exposures," Kozhemiakin concluded.
Bond funds are subject generally to interest rate, credit, liquidity and market risks, to varying degrees, all of which are more fully described in the fund's prospectus. Generally, all other factors being equal, bond prices are inversely related to interest-rate changes, and rate increases can produce price declines.
The use of derivative instruments, such as currency forwards and local interest-rate swaps, involves risks different from, or possibly greater than, the risks associated with investing directly in the underlying assets. A small investment in derivatives could have a potentially large impact on the fund's performance.
Foreign bonds are subject to special risks including exposure to currency fluctuations, changing political and economic conditions, and potentially less liquidity. The fixed income securities of issuers located in emerging markets can be more volatile and less liquid than those of issuers in more mature economies.
A decline in the value of foreign currencies relative to the U.S. dollar will reduce the value of securities held by the fund and denominated in those currencies. Foreign currencies are also subject to risks caused by inflation, interest rates, budget deficits, low savings rates, political factors and government control.
Asset allocation and diversification cannot ensure a profit or protect against loss of principal.
Cathy Elmore provides portfolio management services to the Fund for Standish through Standish Mellon Asset Management (UK) Limited, under Standish (UK)'s supervision, pursuant to an associated person's relationship.