The Dreyfus Corporation, a BNY Mellon company, has launched the Dreyfus TOBAM Emerging Markets Fund, an actively-managed emerging markets equity mutual fund.
TOBAM's patented investment process, which aims to provide an optimal diversification of risk contribution, is designed to enhance an investor's risk/return profile versus traditional capitalisation-weighted strategies.
"Investors who are indexing the core of their portfolio have significant unmanaged risk," says Curtis Arledge, chief executive officer of BNY Mellon Investment Management. "We believe a strategy that actively manages risk, by optimally diversifying risk contribution, is a more intelligent way to build core exposure for client portfolios. By using an optimal diversification approach, TOBAM seeks to avoid benchmark biases and neutrally allocate risks, in order to produce a portfolio with less risk and greater return potential over time."
"Diversification is a powerful tool which combines a set of non-fully correlated assets, seeking results in a portfolio whose risk is lower than the weighted average of the single assets' risks," says Yves Choueifaty, president and chief investment officer of TOBAM. "Unlike benchmarks, TOBAM's unique Diversification Ratio aims to eliminate bias toward high or low volatility stocks. It is long only, with no leverage, and is fully invested."
