BNY Investments launches volatility-focused fund for tail-risk protection
21 JUL, 2025
BNY Investments, part of The Bank of New York Mellon Corporation, has introduced a new investment vehicle aimed at delivering returns during periods of elevated market volatility. The new fund is now available to investors in Europe.
Strategy focused on extreme risk events
The fund, named the BNY Adaptive Risk Overlay Fund, is managed by BNY Investments Newton. It is designed to act as a portfolio overlay, targeting protection against so-called “tail risks” – rare but severe market events. According to the firm, the strategy is intended to complement investors’ core portfolio holdings by offering diversification during unstable market conditions.
The fund forms part of Newton’s broader multi-asset expertise. Lars Middleton will lead the strategy, drawing on the firm’s experience in designing both tactical and systematic hedging solutions.
Expansion of Newton’s index collaboration
The launch also contributes to Newton’s ongoing collaboration with Bank of America. Together, the firms have developed the Newton Adaptive Risk Overlay Index, a customised benchmark designed to support direct investment based on the same principles underpinning the new fund.
Gerald Rehn, Head of Distribution for Europe at BNY Investments, noted a growing demand for liquid instruments that can help investors manage portfolio risk in uncertain conditions. He highlighted Newton’s two-decade track record in absolute return strategies and confirmed that the fund will offer daily liquidity.
We are seeing a growing need for liquid solutions that offer protection against extreme risks, allowing for better portfolio risk management during uncertain times.
With this fund, clients will benefit from daily liquidity and gain access to Newton’s track record of more than two decades in managing absolute return funds during periods of high market volatility.
Gerald Rehn, Head of Distribution for Europe at BNY Investments
