Designed to help maximize risk-adjusted performance, BNY Mellon’s Global Collateral Services business has announced the addition of FundIQ, a third party market research and analytical tool to benchmark performance and areas of risk for institutional prime money market mutual funds.
Through BNY Mellon’s new service, which is available through the company’s Liquidity DIRECT portal, clients can compare fund characteristics against peer group averages and assign ratings in multiple risk categories for individual funds or across an entire portfolio of funds.
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The risk analysis framework covers some 50 characteristics in five broad categories, including:
- Portfolio Risk: How is Liquidity affected by WAM, Spread WAM, diversification and other key characteristics?
- Sponsor Risk: Are the funds backed by institutions with support mechanisms that can withstand crises?
- Advisor/Management Risk: Do the management teams have a favorable track record, in good times and bad?
- Shareholder Risk: Could shareholder composition impact outflows when perceived risks increase?
- Systemic Risk: Are the funds prepared to withstand geopolitical, regulatory, market, and other non-fund specific risk factors?
"Nearly all financial decisions include an assessment of risk," said Jonathan Spirgel, EVP and head of GCS sales and relationship management at BNY Mellon. "Beyond fund characteristics and metrics, this tool helps clients make a more informed investment decision with analysis that recognizes and monitors specific risk factors."
"This sophisticated risk assessment tool is the latest innovation added to BNY Mellon’s Collateral Universe, our suite of second generation collateral management capabilities and solutions that are designed to help buy-side clients manage the impact of marketplace and regulatory change on their investment processes," said Sam Jacob, Global Head of Segregation, Liquidity and Aggregation Products for Global Collateral Services. The FUNDIQ name is registered to Capital Advisors Group.
BNY Mellon Markets combines the company’s Global Markets, Global Collateral Services and Prime Services businesses to meet clients’ evolving trading, collateral, and securities financing needs. Global Collateral Services offers a comprehensive suite of capabilities to help clients address their collateral, liquidity and securities financing needs.
As they face evolving global regulations and rapidly changing market requirements, clients can leverage BNY Mellon’s products and services to better manage counterparty and market risk in their transactions, engage in more investment opportunities to help maximize their investment returns and access new financing alternatives.
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By GlobalDataBNY Mellon currently services $2 trillion in global collateral (including tri-party repo collateral worldwide) and approximately $100 billion in assets through its Liquidity DIRECTS investment portal, and operates one of the industry’s largest securities lending programs, with $3 trillion in lendable assets.
