BNY Mellon Global Income: May 2026 fund update

• The fund’s managers hunt around the globe for the best dividend opportunities

• There has been higher than usual turnover within the investment team in recent years

• The fund continues to grow the level of income it pays to investors

• The fund doesn’t currently feature on the Wealth Shortlist of funds chosen by our analysts for their long-term performance potential

How it fits in a portfolio

BNY Mellon Global Income aims to provide an income and grow capital over the long term by investing in companies from around the world. The fund managers aim to identify the driving forces behind future growth opportunities, such as digitalisation, and then invest in companies they believe can benefit. Typically, they invest more in ‘value’ stocks which means the fund could work well alongside ‘growth’ orientated funds. It could also provide global diversification to an income-focused portfolio.

Manager

Jon Bell and Robert Hay have managed the fund since April 2020. While the managers have lots of experience between them, they have only worked together on this fund for a short period of time.

Bell joined Newton, now part of BNY Mellon, in 1995 after graduating from Cambridge University. He’s spent much of his time managing global and multi-asset portfolios. Bell’s time is divided between portfolio management and keeping investors updated on the fund’s activities.

Hay began his career in the private client investment division at Newton in 2000 and has managed a number of global equity strategies during this time.

Previous co-manager, and Head of Equity Income, James Lydotes left BNY Mellon in 2025. This follows the departure of his predecessor Ilga Haubelt in 2022. Paul Flood was also a co-manager on the fund but left the Equity Income team to focus on his new role as Head of Mixed Assets Investment and the multi-asset funds he manages.

Although Bell and Hay have managed this fund together since 2020, the level of turnover in their co-managers has been higher than we would typically expect during this time.

Process

The managers believe the best way to achieve long-term growth is through the compounding effect of reinvesting dividends over time. They have a strict buy and sell discipline and any company considered for the fund must have shares that yield at least 25% more than the fund’s benchmark – the FTSE World Index. If the yield falls below that level, the company must be sold.

The team aims to avoid companies with higher yields that might not be sustainable into the future. As a result, they invest in ‘quality’ companies which have a dominant market position, sensible balance sheets, and can generate cash. They must also understand how companies might benefit or struggle to adapt to an ever-evolving society. The managers assess if these businesses are supported by thematic tailwinds like digitalisation or the transition to renewable energy.

The companies selected for the fund are broadly split into four buckets of ‘controversy’.

‘Troubled Compounding Machines’ form the foundation of the fund, with 38% invested in this bucket. These companies are in industries with high barriers to entry, whether legal, geographical, or cost-based. They may be good businesses with growth potential which are hampered by short-term obstacles the managers are prepared to look past.

‘Ex-growth Cash Generators’ includes companies whose best days of growth might be behind them but are underrated by other investors, even though they can still efficiently generate returns. These companies currently make up 21% of the fund.

14% of the fund is in the bucket which focuses on ‘Capital Intensity’ and is home to businesses such as banks and insurance firms. Finally, ‘Profitability Transformation’ tends to include more economically sensitive companies and currently makes up 23% of the fund.

Most of the fund invests in developed markets. US companies currently make up 47.5% of the fund, although this is less than the broader market. A further 10.4% invests in the UK and 10.3% in France. It also invests in some higher-risk emerging markets, such as Taiwan, but this is a small part of the fund.

The fund typically contains around 60 companies and over the past year the managers have made a number of changes to the fund. An investment was made in computer game developer NetEase as the managers believe the company was unfairly branded an artificial intelligence (AI) ‘loser’ and this means the shares are now undervalued. Other new investments include US clothing manufacturer Levi Strauss and Danish pharmaceutical company Novo Nordisk.

The managers sold their investments in two insurance companies – MetLife in the US and German firm Munich Reinsurance. Investments were also sold in C.H. Robinson, Sandvik, and Estee Lauder after the yield on each company’s shares fell below the threshold required by the fund’s investment process.

Investors should be aware that fund charges are taken from capital, which can increase the yield but reduces the potential for capital growth. The managers also have the flexibility to use derivatives, which can increase risk.

Culture

Newton Investment Management has historically been responsible for this fund and now operates under the umbrella of BNY Mellon. BNY Mellon is a large, US-based firm so the managers have plenty of analysts and resources at their disposal. Until mid-2019 the fund operated under the Newton banner but following a rebrand the fund name has since changed to that of the parent company.

Equity income investing is an important part of Newton’s business. Alongside this fund’s managers, there are other experienced investors in the equity income team who focus on different regions and can provide additional insight and challenge.

We like that the fund managers are incentivised in a way that aligns their interests with those of long-term investors. That said, there have been some significant fund manager departures in recent years, and we hope the current team will provide some stability for investors.

ESG integration

The team at BNY Mellon (formerly Newton) believes responsibly managed companies are better placed to achieve sustainable competitive advantage and provide strong long-term growth. While they’ve invested time and resource into their Responsible Investment proposition in recent years, we’re disappointed to note the departure of Therese Niklasson in 2025, someone we’ve long held in high regard.

A dedicated Responsible Investment team exercises the firm’s voting rights, coordinates engagement with investee companies, and contributes to public debate on Environmental, Social, and Governance (ESG) matters. The team reports on their engagement progress in their annual Sustainability and Stewardship report, and their ‘Responsible Investment Quarterly Activities’ report (both available on the Newton website). They also offer a voting dashboard, which provides fund-by-fund search functionality and detailed rationales for votes against management and abstentions.

All fund managers have access to a variety of tools, including a “Responsible Investment reviews” app which centralises a variety of research providers’ data, as well as their own, to help identify material ESG and sustainability issues for a single company, and a ‘net zero assessment’ tool assesses credibility of each company’s net zero transition plan. The firm has also launched a Stewardship app, a database which allows the team to better track progress on their engagement objectives, as well as outcomes from their engagement and voting activities.

Although the fund managers integrate ESG analysis into their investment decisions this fund doesn’t have a sustainable mandate. Investors should be aware that, of the funds under our research coverage, this is one of the most carbon intensive and, as of December 2025, 14.98% of the fund invests in companies involved with the extraction of fossil fuels. These companies could face increased regulatory scrutiny and operational challenges, potentially impacting the fund's future performance.

Cost

This fund has an ongoing annual charge of 0.81%, but we’ve secured a discount for HL clients of 0.24%. This means you will pay a net ongoing charge of 0.57%.

The fund discount is achieved through a loyalty bonus, which could be subject to tax if held outside of an ISA or SIPP. The HL platform fee of 0.35% per year will also apply, except in the HL Junior ISA, where no platform fee applies.

We recently made some changes to the amount clients pay to invest with us. Find out more about these changes.

Performance

Since Hay and Bell became managers of the fund in April 2020 the fund has returned 99.65%*, ahead of the average returns of 96.23% for peers in the IA Global Equity Income sector. Past performance isn’t a guide to future returns. However, other fund managers have provided input into the fund’s decision-making during most of this time, meaning performance shouldn’t be completely attributed to Hay and Bell.

Over the 12 months to the end of April 2026, the fund’s returns of 23.91% were ahead of the IA Global Equity Income sector, where the average fund returned 19.70%.

Technology companies contributed to performance, despite the fund having less invested in this strongly-performing part of the market. These included Korean giant Samsung Electronics, which has benefited from the role it’s playing in wider adoption of AI. Taiwanese companies ASE Technology and MediaTek also contributed. The fund has since sold its investment in ASE following a strong rise in share price.

A number of healthcare investments were also positive for the fund, including UK pharmaceutical companies GSK and AstraZeneca.

Investments that detracted from performance included French industrials business Saint-Gobain and US-based packaging company International Paper. Household products company Kenvue also detracted from performance and the managers have now sold their investment.

Apart from a slight decline during the Covid-19 pandemic, the fund has consistently grown the income paid to investors each year. The fund currently yields 2.67%. Yields and any income aren’t guaranteed and will change over time.