BNY Mellon Mobility Innovation Fund
Charging Ahead
For Professional Clients only . Any views and opinions are those of the investment manager, unless otherwise noted.
Managed by
June 2020
What is Mobility Innovation?
Mobility Innovation The disruptive, transformational shift in how we use, power, and control all means of mobility, profoundly impacting businesses, governments, and consumers by materially altering interactions
across the mobility landscape
1
Consumer Auto replacement cycle
Demographics
Growing Asian consumer
Environmental CO2 emission scandal
Emerging markets pollution
Clean grid infrastructure
Regulatory Urban congestion
Autonomous vehicle readiness
Road safety
Technology Cloud infrastructure
Edge computing
5G roll out
Catalysts for Mobility Innovation – Pre/Post Covid-19
2
Covid-19 Impact? – Mobility trends accelerating While the pandemic led to a pause in the movement of people, goods, services, and the transformation of mobility accelerated!
3
Connectivity is redefining many aspects of life
Factory Automation is expanding Digital Transformation is here Innovation beyond passenger cars
Urban mobility challenges
Sources: 1. Delphi Automotive PLC, September 2017. 2. United Nations, May 2018. 3. Navigant Research, Q2 2017 Report. 4. Fortune, March 2016. 5. World Health Organization, 2018 Report. 6. United States Environmental Protection Agency, 2016.
4
68% of the world population projected to live in urban areas by 20502 +40%
freight1
World population projected to reach 9.8bn in 20502
Transportation accounts for 28% of all green house gases6
1.2bn vehicles on world's roads now, 2.0bn by 20353
On average, cars are parked 95% of the time4
4X cost1
The number of annual road traffic deaths has reached 1.35 million5
5x emissions1 3x travel time1
!
Urban areas will be particularly impacted by mobility challenges
Uniquely positioned to address mobility's toughest challenges
Mobility benefits
Sources: 1. Delphi Automotive PLC, September 2017. 2. Forbes, September 2017. 3. Counterpoint Research, April 2018. 4. BloombergNEF, Outlook 2018. 5. Frost & Sullivan, https://ww2.frost.com/research/visionary-innovation/future-mobility/, accessed March 2019.
5
28% less vehicles1
EVs will make
up 65% of new light-duty
vehicle sales by 20502
44% fewer parking spaces will be needed1
66% lower
emissions1
Over 50 cities worldwide will have zero
emission taxis5
125 million connected cars with embedded connectivity to be shipped 2018-20223
87% fewer
accidents1
Electrified buses and cars will displace a combined 7.3 million barrels per day of transportation fuel in 20404
By 2040, 55% of all new car sales and 33% of the global fleet will be electric4
30% shorter travel
time1
The four key drivers of Mobility Innovation CASE
Sources: Top right: Automotive Glazing Academy, http://aga.uk.net/advanced‐driver‐assistance‐systems/adas/, accessed May 2018. Bottom left: McKinsey Center for Future Mobility as at September 2017. Bottom right: Bloomberg New Energy Finance as at 21 May 2018.
6
Connectivity Autonomous Vehicles
Sharing Electrification
EVs To Garner Half The Global Auto Market By 2040 New Ride Sharing, Subscription, and Distribution Models
Mill
ion
cars
per
yea
r
Cloud Storage
Software Platforms
Advanced Mapping Systems
High-resolution
Big Data Analytics
High Speed Data Towers
V2X Communication
Connected Road Infrastructure
Apps and Services
C.A.S.E. industry acronym is a roadmap… but it does not stand
still. It’s accelerating!
A highly active theme which will continue to evolve
Cyber… vehicles as digital platforms
Adaptive… it will know you!
Sharing DATA… “the new oil”
Electrification… beyond the car
Connectivity
Autonomy
Sharing
Electrification
Mobility Innovation never stands still – regardless of Covid-19
7
Cars and other forms of mobility are digital platforms.
Connectivity Cyber
OEMs are building their products to enable new services
An open and modular approach is the way to go…
..but a move to digital / cyber platforms expands the attack surface and opportunity for malware
SECURITY IS A NEW PLAY
8
Autonomy Adaptive
• Adapt to drivers
• Adapt to other cars
• Adapt to obstructions
• Adapt to pedestrians
Cars and other forms of mobility will understand us – not just know us!
• Smart Roads
• Connected Infrastructure
• Safety!
9
Sharing not just rides…DATA OEMS will offer new services to help consumers OPT-IN to share
their data, and benefit from other’s Slippery road
ahead!
Purchase 4WD activation?
Rideshare request
$$$
SLOW!!!
Accident ahead!
Lunch points ahead
Available parking
$$$
Emergency vehicle
approaching
Pull aside
10
Electrification of new forms of Mobility Electrification is going beyond the car
11
Investment team and process
Quantitative portfolio manager
Strategist
Portfolio manager
Portfolio manager
Lead portfolio manager
BNY Mellon Mobility Innovation Fund
Source: Mellon as at March 2020. CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.
Investment team
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Research capabilities
Fundamental Research ESG Alternative Research Quantitative
Robert Zeuthen, CFA Senior Portfolio Manager
Frank Goguen, CFA Senior Research Analyst
Erik Swords Senior Research Analyst
Shawn Zhang, CFA Senior Research Analyst
George Saffaye Global Investment Strategist
Investment resources Mellon Global Equity Research team
Source: Mellon as at March 2020. Years shown indicate industry experience. Years of experience may include partial year periods. 1. Employee of affiliated entity. CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute. CMT® and Chartered Market Technician® are registered trademarks owned by Market Technicians Association.
14
Matthew Griffin, CFA Head of Global Equity Research 29 years
Javon Collins Research Associate 1 year
Matthew Jenkin Senior Research Analyst 20 years
Oluwaseun Ososami Research Associate 5 years
Karen Miki Behr Senior Research Analyst 21 years
Veronique Daphnis Research Associate 9 years
Thomas Karthaus, CFA Research Analyst 16 years
Rick Rosania, CFA Senior Research Analyst 25 years
Amanda Birdsey-Benson, PhD Senior Research Analyst 8 years
Jack Encarnacao Research Analyst 3 years
Katherine Kelly Research Analyst 5 years
Justin Sumner, CFA Senior Research Analyst 22 years
Brian Blongastainer, CFA, CMT Senior Research Analyst 16 years
Frank Goguen, CFA Senior Research Analyst 25 years
Cameron Kilduff Research Associate 1 year
Erik Swords Senior Research Analyst 20 years
Richard Bullock, CFA1
Senior Research Analyst 16 years
Anushree Gupta Research Analyst 3 years
Monty Kori Senior Research Analyst 18 years
Leigh Todd, CFA Senior Portfolio Manager 24 years
Brock Campbell, CFA Senior Research Analyst 15 years
Michael Holton Senior Research Analyst 25 years
Raphael Lewis Research Analyst 13 years
Alex Trombetta Research Associate 3 years
Adam Chen Senior Research Associate 4 years
Keith Howell Jr., CFA Senior Research Analyst 14 years
Kyle McDonough, CFA Research Associate 5 years
Robert Zeuthen, CFA Senior Portfolio Manager 30 years
Albert Chu, CFA Senior Research Analyst 20 years
David Intoppa Senior Research Analyst 20 years
Julianne McHugh Senior Portfolio Manager 28 years
Research capabilities
Fundamental Research ESG Alternative Research Quantitative
Investment resources Mellon Small Mid Equity Research team
Source: Mellon as at March 2020. Years shown indicate industry experience. Years of experience may include partial year periods. CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute. CMT® and Chartered Market Technician® are registered trademarks owned by Market Technicians Association.
15
Research capabilities
Fundamental Research ESG Alternative Research Quantitative
Patrick Kent, CFA, CMT Senior Portfolio Manager 22 years
William Eckel, CFA Research Analyst 9 years
Jonathan Piskorowski, CFA Senior Research Analyst 17 years
Amanda Birdsey-Benson, PhD Senior Research Analyst 8 years
Jack Encarnacao Research Analyst 3 years
Todd Wakefield, CFA Senior Portfolio Manager 28 years
James Boyd, CFA Senior Portfolio Manager 27 years
Caroline Higgins, CFA Research Analyst 28 years
Edward Walter, CFA Senior Portfolio Manager 31 years
Stephanie Brandaleone, CFA Senior Research Analyst 29 years
Andrew Leger Senior Portfolio Manager 22 years
Robert Zeuthen, CFA Senior Portfolio Manager 30 years
Nicholas Cohn Senior Research Analyst 13 years
Raphael Lewis Research Analyst 13 years
Investment resources Thematic equity research
Source: Mellon as at March 2020. CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute. CMT® and Chartered Market Technician® are registered trademarks owned by Market Technicians Association.
16
Build Connect Consume Renew Secure Heal Move Brock Campbell, CFA Senior Research Analyst
James Boyd, CFA Senior Portfolio Manager
Leigh Todd, CFA Senior Portfolio Manager
Andrew Leger Senior Portfolio Manager
Michael Holton Senior Research Analyst
Amanda Birdsey-Benson, PhD Senior Research Analyst
Robert Zeuthen, CFA Senior Portfolio Manager
Albert Chu, CFA Senior Research Analyst
Justin Sumner, CFA Senior Research Analyst
Todd Wakefield, CFA Senior Portfolio Manager
Robin Wehbé, CFA, CMT Senior Portfolio Manager
Keith Howell Jr., CFA Senior Research Analyst
Matthew Jenkin Senior Research Analyst
Frank Goguen, CFA Senior Research Analyst
Monty Kori Senior Research Analyst
Anushree Gupta Research Analyst
Karen Miki Behr Senior Research Analyst
David Intoppa Senior Research Analyst
Erik Swords Senior Research Analyst
Rick Rosania, CFA Senior Research Analyst
William Eckel, CFA Research Analyst
Brian Blongastainer, CFA, CMT Senior Research Analyst
Jonathan Piskorowski, CFA Senior Research Analyst
Edward Walter, CFA Senior Portfolio Manager
Caroline Higgins, CFA Research Analyst
Nicholas Cohn Senior Research Analyst
Alternative & future research Generalists Jack Encarnacao Research Analyst
Thomas Karthaus, CFA Research Analyst
Richard Bullock, CFA* Senior Research Analyst
Adam Chen Senior Research Associate
Veronique Daphnis Research Associate
Kyle McDonough, CFA Research Associate
Alex Trombetta Research Associate
Raphael Lewis Research Analyst
Katherine Kelly Research Analyst
Javon Collins Research Associate
Cameron Kilduff Research Associate
Olumaseun Ososami Research Associate
John Porter III CIO, Head of Equity
Matthew Griffin, CFA Head of Global Equity Research
BNY Mellon Mobility Innovation Fund Investment process
Source: Mellon Investment Managers are appointed by BNY Mellon Investment Management EMEA Limited (BNYMIM EMEA), BNY Mellon Fund Management (Luxembourg) S.A. (BNY MFML) or affiliated fund operating companies to undertake portfolio management activities in relation to contracts for products and services entered into by clients with BNYMIM EMEA, BNY MFML or the BNY Mellon funds.
17
Thematic research Candidate list
Security selection Portfolio construction Portfolio
management
• Global research analysts identify themes and trends
• Annual off sites
• White paper research
• Sub-theme identification
• Establish universe
• Measure materiality to the theme
• Identify theme leadership
• Fundamental analysis
• Establish price targets
• Fundamental review by analysts and lead portfolio manager
• Maximise portfolio alpha subject to risk constraints
• Qualitative review
• Risk management
• Weekly optimisation
• Implementation and trading
BNY Mellon Mobility Innovation Fund
Industry breakdown (%)
Top 10 holdings
BNY Mellon Mobility Innovation Fund
Company Country Industry Fund (%)
Splunk Inc. United States Software 6.4
ANSYS, Inc. United States Software 5.8
MediaTek Inc Taiwan Semiconductors & Semiconductor Equipment 4.0
Roper Technologies, Inc. United States Industrial Conglomerates 4.0
Alphabet Inc. Class A United States Interactive Media & Services 3.5
STMicroelectronics NV Switzerland Semiconductors & Semiconductor Equipment 3.4
Slack Technologies, Inc. Class A United States Software 3.4
Aptiv PLC United States Auto Components 3.2
Yandex NV Class A Russia Interactive Media & Services 3.2
Samsung SDI Co., Ltd South Korea Electronic Equipment Instruments & Components 3.0
Total 40.0
Source: Mellon, excludes cash.
Portfolio structure as at 31 May 2020
19
1.0
1.6
1.7
2.4
3.0
5.0
6.0
6.7
8.9
11.0
12.6
18.1
22.2
Machinery
Electric Utilities
Internet & Direct Marketing Retail
Communications Equipment
IT Services
Industrial Conglomerates
Automobiles
Interactive Media & Services
Electrical Equipment
Auto Components
Electronic Equipment Instruments &…
Software
Semiconductors & Semiconductor…
Portfolio characteristics
Region breakdown (%)
Market capitalisation breakdown (%)
BNY Mellon Mobility Innovation Fund
Fund MSCI AC World Mid Cap Index
Price-to-earnings using FY1 estimates (including negative earnings, x) 31.2 22.6
Estimated 3-5 year EPS growth (%) 25.9 9.7
Return on equity (%) 5.2 13.7
Price-to-earnings (excluding negative earnings, x) 25.4 16.9
Source: Mellon, excludes cash.
Portfolio structure as at 31 May 2020
20
2.1
47.4
44.1
6.4
1.9
26.3
30.0
41.8
<US$2bn
US$2bn-US$10bn
US$10bn-US$25bn
>US$25bn
Fund MSCI AC World Mid Cap Index
North America
62.4
Asia Pacific 21.6
Europe 12.8
Russia 3.2
BNY Mellon Mobility Innovation Fund, USD W (Acc.) Performance as at 31 May 2020
Source: Lipper. Fund performance calculated as total return, based on net asset value, including charges, but excluding initial charge, income reinvested gross of tax, expressed in share class currency. The impact of the initial charge, which may be up to 5%, can be material on the performance of your investment. Performance figures including the initial charge are available upon request. Please note that sector returns are likely to vary, depending on the timing of data extraction from Lipper.
21
Why Mobility Innovation? • How we use, power and control all means of mobility is at the early stages of a vast transformational shift – from the growth in electric
and autonomous vehicles, through to ridesharing and the technology underpinning data connectivity. New businesses are being formed across the supply chain and supporting infrastructure to profit from these new opportunities.
Why now? • Early movers in the smart mobility space are likely to become the market leaders. • Investors have the opportunity to invest in these future growth areas at an early entry point and at a time when we believe the scale of
the transformation in the smart mobility landscape has yet to be reflected in stock prices. • Covid-19 pandemic has accelerated the digital transformation, further propelling innovations in Mobility
Why BNY Mellon Mobility Innovation Fund? • Team managing the Fund has tracked the automobile, component and software industries throughout their careers making the portfolio
managers ideally placed to understand disruption within the mobility landscape. • Supported by the firm’s broader research expertise across large, mid and small cap equities, investment styles, regions, investigative,
private markets, and geopolitical research. • Offers true differentiation to global equity indices and other thematic equity products.
BNY Mellon Mobility Innovation Fund Summary
22
Appendix
BNY Mellon Mobility Innovation Fund Product overview
Source: BNY Mellon Investment Management EMEA Limited
24
Asset class Equities
Region Global
Investment objective To achieve long-term capital growth by primarily gaining exposure to companies located worldwide that are focused on innovation in transportation and related technologies.
Benchmark MSCI AC World Mid Cap NR Index
Fund inception 1 August 2018
Fund manager Team approach
Typical number of holdings 40-60
Base currency USD
Available currencies AUD, CAD, CHF, EUR, GBP, HKD, SGD, USD
Legal structure UCITS
Fund structure ICVC (Dublin-domiciled)
Regulatory authority Central Bank of Ireland
Dealing deadline 12:00 hours Dublin, Ireland and US business day
Valuation point 22:00 hours Dublin, Ireland and US business day
BNY Mellon Mobility Innovation Fund Share classes
Please note, further share classes are available. Please refer to the prospectus for further information.
25
Share class Initial sales charge Minimum initial
investment Annual management
fee Redemption fee ISIN Code Bloomberg Code USD A (Acc.) Up to 5% $5,000 1.85% None IE00BZ199J22 BNMIAAU
Euro A (Acc.) Up to 5% €5,000 1.85% None IE00BZ199G90 BNYMIEA
USD B (Acc.) Up to 5% $10,000 1.40% None IE00BZ199S13 BNMIBAU
USD C (Acc.) Up to 5% $5,000,000 0.90% None IE00BZ199Z89 BNMIUSC
Euro C (Acc.) Up to 5% €5,000,000 0.90% None IE00BZ199X65 BNMIEUC
SGD C (Acc.) Up to 5% SGD 5,000,000 0.90% None IE00BZ19B185 N/A
Euro I (Acc.) (hedged) Up to 5% €5,000,000 0.90% None IE00BZ19B300 N/A
SGD I (Acc.) (hedged) Up to 5% SGD 5,000,000 0.90% None IE00BZ19CB51 N/A
USD G (Acc) Up to 5% $5,000 0.90% None IE00BZ19B417 N/A
Euro G (Acc.) Up to 5% €5,000 0.90% None IE00BZ19B631 N/A
USD W (Acc.) Up to 5% $15,000,000 0.70% None IE00BZ1HLV20 BNMIWAU
Euro W (Acc.) Up to 5% €15,000,000 0.70% None IE00BZ1HLX44 N/A
CHF W (Acc.) Up to 5% CHF 15,000,000 0.70% None IE00BGCSBL17 N/A
SGD W (Acc.) Up to 5% SGD 15,000,000 0.70% None IE00BGCSBN31 N/A
Sterling W (Acc.) Up to 5% £15,000,000 0.70% None IE00BZ7PDY70 BMMIGWA
Euro W (Acc.) (hedged) Up to 5% €15,000,000 0.70% None IE00BGCSBQ61 BNMWAHE
SGD W (Acc.) (hedged) Up to 5% SGD 15,000,000 0.70% None IE00BDZW5F18 N/A
Portfolio allocation by CASE category
BNY Mellon Mobility Innovation Fund CASE weightings as at 31 March 2020
Source: Mellon. Total weight is an allocation of the 31 March 2020 end portfolio weight split evenly between the stocks CASE theme as a percentage of the total portfolio, where applicable, excludes cash, ETFs and futures.
26
Top stocks by weight
0%
5%
10%
15%
20%
25%
30%
35%
40%
45%
50%
Connectivity Autonomous Vehicles Sharing Electrification
V2x (vehicle-to-everything) enables vehicle communication With each other (V2V), to pedestrians (V2P), to roadway infrastructure (V2I) and to the network (V2N)
Source: Mellon
27
Implication: More data storage, greater speeds and processing power needed
e.g. Pedestrian in crosswalk
Vehicle-to-pedestrian (V2P)
e.g. emergency vehicle approaching or vehicle
approaching over centre divider
Vehicle-to-vehicle (V2V)
e.g. Traffic backup three miles ahead
Vehicle-to-network (V2N)
e.g. traffic light ahead turning red or three
parking spaces available on this street
Vehicle-to-infrastructure (V2I)
ADAS systems continue to dominate growth in automotive content
28
Today, consumers use their vehicles for every purpose. In the future, they will choose an optimal mobility solution for each specific purpose
29
Source: McKinsey Center for Future Mobility, September 2017.
Today: One vehicle for every trip purpose
2030: A solution for each different specific purpose
Business
Leisure
Vacation
Shopping
Commuting to work Business
Leisure
Vacation Shopping
Commuting to work
+ non-vehicle modes of mobility
Long-term EV sales by region
Electric vehicle sales and automaker targets through 2040
Source: Bloomberg New Energy Finance, May 2018. Please note, graphs include projected figures.
30
Automaker Target Year
VW Group 2-3 million EVs sold annually 2025
General Motors 1 million EVs sold annually 2026
Daimler 15-25% of sales to be EVs 2025
BMW 15-25% of sales to be EVs 2025
Volvo 50% of sales to be BEVs 2025
Porsche 50% of sales to be EVs 2023
Chang’an 100% of sales to be EVs 2025
BAIC 100% of sales to be EVs in China 2025
• A disciplined, concentrated global equity portfolio that seeks to achieve long-term capital growth through exposure to companies focused on the development, adoption and integration of the soon to be ubiquitous technologies associated with a new era of smart mobility
• Portfolio holdings selected through bottom-up stock selection within the benchmark subindustries and individual securities that the investment team has identified as being impacted by disruptive auto trends
• Pioneering approach leverages the fundamental and quantitative research capabilities of Mellon’s active equity teams: ‒ Managing active, fundamental equity strategies encompassing a broad array of geographies, capitalisations and styles since 1970 ‒ Active equity AUM of US$31.7bn1
‒ Including over US$5.6bn in thematic portfolios1
BNY Mellon Mobility Innovation Fund A thematic equity fund focused on disruption in transport and related industries
1. Source: Mellon as at 31 March, 2020. Where applicable, assets include discretionary and non-discretionary assets, the notional value of overlay strategies, and assets managed by investment personnel acting in their capacity as officers of affiliated entities.
31
Agenda • What is Mobility Innovation and why now?
• Investment team and approach
• BNY Mellon Mobility Innovation Fund
Mellon’s active equity capabilities Over 15 years of thematic research and thought leadership
Source: Mellon
32
Mellon’s active equity capabilities Evolution of thematic equity solutions
1. Includes client assets invested in the Hedged and Unhedged Global Infrastructure Dividend Focus Equity strategies. The hedged strategy has the same diversified equity investment strategy as the unhedged strategy but includes the use of currency forward contracts to hedge the currency to USD. Source: Mellon as at 31 December 2019. Where applicable, assets include discretionary and non-discretionary assets, the notional value of overlay strategies, and assets managed by investment personnel acting in their capacity as officers of affiliated entities. Post 2011, solutions were developed alongside clients to provide bespoke thematic portfolios.
33
Global Infrastructure Dividend Focus Equity
AUM: US$2.1bn1
US Manufacturing Renaissance
AUM: US$128.1m
US Housing Market Closed
Global Healthcare REIT
AUM: US$909.8m
Global FinTech Closed
Internet of Things
AUM: US$954.4m
US Infrastructure AUM: US$2.0m
Mobility Innovation Equity
AUM: US$1.7bn
Global Natural Resources
AUM:US$1.1bn
Gold & Mining
AUM: US$16.2m
Global Tech
AUM: US$908.8m
Prior to 2011 2011 2012 2013 2014 2015 2016 2017 2018 2019
Digital Assets
AUM: US$11.1m
First Decade Innovators
AUM: US$30.5m
ESG framework
Mellon has made the deliberate decision to imbed ESG analysis throughout its investment processes. The result is firm-wide, bottom-up integration supported by the firm’s senior management.
Mellon’s process relies on recognition and analysis to: • See what the market may not
• Identify materiality, risk and opportunities
• Collaborate across disciplines
• Review and debate across sectors
All Mellon’s ESG efforts are: • In support of its fiduciary duty to the firm’s clients and to their stated risk and return objectives
• Supported by the firm’s research analysts’ and portfolio managers’ expertise
Mellon integrates ESG considerations into the firm’s investment processes in three ways: research expertise, solutions and product strategies.
BNY Mellon Mobility Innovation Fund
Source: Mellon
Mellon’s ESG framework
34
● Integrated
● Risk mitigating
● Opportunity seeking
RESEARCH
● Thematic
● Long-term stewardship
INVESTMENT
● Responsibility of ownership
● Opportunity to influence outcomes
PROXY VOTING
● Valuable dialogue
● Longstanding practice
ENGAGEMENT
● Client directed
● Articulation & implementation
CONSULTING
5G
Three Major Use Cases
5G: Making better use of the radio spectrum What's really exciting is all the new services that will be built that we can't foresee
35
Mission-critical Applications requiring high reliability
● Strong security
● Ultra-high reliability
● Ultra-low latency
● Extreme user mobility
Internet of things
● Ultra-high density
● Ultra-low complexity
● Ultra-low energy
● Deep coverage
Enhanced broadband
● Deep awareness
● Extreme data rates
● Extreme capacity
5G NR
5G: The new spectrum frontier 5G will operate on previously unused frequencies within the existing radio portion of the electromagnetic spectrum
Source: Federal Communications Commission (FCC); Qualcomm; Mellon
36
Electromagnetic spectrum
10 H
Z
100
HZ
1 kH
Z
10 k
HZ
100
kHZ
1 M
HZ
10 M
HZ
100
MH
Z
1 G
HZ
10 G
HZ
100
GH
Z
1 TH
Z
10 T
HZ
100
THZ
1015
HZ
1016
HZ
1017
HZ
1018
HZ
1019
HZ
1020
HZ
1021
HZ
1022
HZ
1023
HZ
1024
HZ
VLF LF
MF
HF
VH
F
UH
F
SH
F
EH
F
Infrared Ultraviolet X-Ray Gamma-Ray Cosmic-Ray Visible
Non-Ionizing Radiation Ionizing Radiation
Radio Spectrum Optical Spectrum
● ~11 GHz of new radio (NR) spectrum for flexible use wireless broadband
● New Upper Microwave Flexible Use service in the 28 GHz, 37 GHz, and 39 GHz bands
● Unlicensed band at 64-71 GHz
● Leveraging mmWaves (High-Band) which will require innovation in small cell, massive multiple-input, multiple-output (MIMO), beamforming, and duplex
Low-Band Mid-Band
High-Band
10 k
HZ
100
kHZ
1 M
HZ
10 M
HZ
100
MH
Z
1 G
HZ
10 G
HZ
100
GH
Z
3G
4G
5G
The SAE has formalised six levels of autonomous driving
Source: NHTSA “Automated Vehicles for Safety”, accessed May 2018.
37
0
No Automation
Zero autonomy,
the driver performs all
driving tasks.
5
Full Automation
The vehicle is
capable of performing all
driving functions under all
conditions. The driver may have
the option to control the
vehicle.
1
Driver Assistance
Vehicle is
controlled by the driver, but some
driving assist features may be included in the vehicle design.
2
Partial Automation
Vehicle has combined automated
functions, like acceleration and steering, but the
driver must remain engaged with the driving
task and monitor the environment
at all times.
3
Conditional Automation
Driver is a
necessity, but is not required to
monitor the environment.
The driver must be ready to take
control of the vehicle at all times with
notice.
4
High Automation
The vehicle is
capable of performing all
driving functions under certain
conditions. The driver may have
the option to control the
vehicle.
Full Automation Society of Automotive Engineers (SAE) Automation Levels
ADAS systems continue to evolve Multiple systems and system redundancy is essential for automated driving
Source: Mellon
38
It’s all about the lithium-ion battery
39
Li Li
Li Li
CHARGING
Positively charged lithium ions pass from cathode to anode to be stored until discharge
DISCHARGING
Energy is removed from the cell to be used outside the battery as lithium ions pass from the anode to cathode
ANODE
Negative electrode made of graphite that releases Lithium Ions while battery is discharging
SEPARATOR
Blocks flow of electrons
CATHODE
Positive electrode, containing cobalt, that releases Lithium Ions while battery is charging
ELECTROLYTE
Carries Lithium Ions between Anode & Cathode
e
e
The life cycle of a car
*Source: United States Department of Transportation - Federal Highway Administration as at 29 March 2018.
40
Cars Now
Car Design Can take over 3 years to
design modern cars
Manufacturing Labour
Intensive
Sale Companies have to
push to sell cars
Operation* 13.5k miles per year, Only 5% utilization
Maintenance Periodic
maintenance
Resale Used car dealer and
online sites
Scrapping Full junkyards hard
to recycle
3 Years plus 1 Day 2 Months 11 Years 1 Month 2 Months Total: 14.4 Years
Future of Cars
Car Design Modular design
and smaller refreshes
Manufacturing New Materials and
Techniques
Rent/Share Leased to
wholesalers
Operation Higher Utilization, Multiple
drivers, High Mileage
Maintenance OTA update,
active monitoring
Resale New market is rental
car companies
Scrapping Better recycling for
EV batteries
1 Year or less < 1 Day 1 Month 5 Years 0 1 Month Total: 6.1 Years
Hype – the misperception of reality Hype cycle for Electric Car Company A
Source: Mellon, Bloomberg
41
New technology triggers
innovation
Hype peaks
Excitement wains and the reality creates disillusionment
True, sustainable innovation drives long term growth
Funding is secured to take company private to preserve the vision and long term values and to protect from short term commercial choices
Announce new products that whilst innovative may not have long term commercial viability
Expe
ctat
ion
Company is unable to deliver on promised innovation in a sustainable long term model
Long term growth is found from innovation, investment and expertise
Company goes private with plans to revolutionize manufacturing and product
Company diversifies out of core business, using capital for acquisitions to add value to the “new business model”
Company has innovative product and first mover advantage
Company leadership builds confidence in delivering real innovation
Production difficulties hamper delivery
Excitement builds for new design and technology Company ramps up hype on what can be delivered
Time
Key investment risks
Performance
Investment objective and benchmark
BNY Mellon Mobility Innovation Fund
Objective: To achieve long-term capital growth by primarily gaining exposure to companies located worldwide that are focused on innovation in transportation and related technologies. Benchmark: The Fund will measure its performance against the MSCI AC World Mid Cap NR Index (the "Benchmark"). The Fund is actively managed, which means the Investment Manager has absolute discretion to invest outside the Benchmark subject to the investment objective and policies disclosed in the Prospectus. While the Fund's holdings may include constituents of the Benchmark, the selection of investments and their weightings in the portfolio are not influenced by the Benchmark. The investment strategy does not restrict the extent to which the Investment Manager may deviate from the Benchmark.
Investment objective, annual performance and key risks
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• Objective/Performance Risk: There is no guarantee that the Fund will achieve its objectives. • Currency Risk: This Fund invests in international markets which means it is exposed to changes in
currency rates which could affect the value of the Fund. • Derivatives Risk: Derivatives are highly sensitive to changes in the value of the asset from which their
value is derived. A small movement in the value of the underlying asset can cause a large movement in the value of the derivative. This can increase the sizes of losses and gains, causing the value of your investment to fluctuate. When using derivatives, the Fund can lose significantly more than the amount it has invested in derivatives.
• Emerging Markets Risk: Emerging Markets have additional risks due to less-developed market practices. • Market Capitalisation Risk: Investments in the securities of small to medium-sized companies (by market
capitalisation) may be riskier and less liquid (i.e. harder to sell) than large companies. This means that their share prices may have greater fluctuations.
• Counterparty Risk: The insolvency of any institutions providing services such as custody of assets or acting as a counterparty to derivatives or other contractual arrangements, may expose the Fund to financial loss.
• Mobility Innovation Companies Risk: The value of investments in Mobility Innovation Companies may be negatively impacted by changes in regulation and are dependent upon consumer and business acceptance of new technologies. The Fund's value may be more subject to market fluctuations than if it invested in a broader range of economic sectors.
• Share Class Currency Risk: Share classes may be denominated in a different currency from the base currency of the Fund. Changes in the exchange rate between the share class currency and the base currency may affect the value of your investment.
• Share Class Hedging Risk: The hedging strategy is used to reduce the impact of exchange rate movements between the share class currency and the base currency. It may not completely achieve this due to factors such as interest rate differentials.
Past performance is not a guide to future performance. The value of investments can fall. Investors may not get back the amount invested.
May-15 to May-16 to May-17 to May-18 to May-19 toMay-16 May-17 May-18 May-19 May-20
BNY Mellon Mobility Innovation Fund - - - - 22.78
Benchmark -4.87 15.86 12.50 -5.15 0.27
Calendar year returns (%) 2015 2016 2017 2018 2019
BNY Mellon Mobility Innovation Fund - - - - 28.88
Benchmark -1.61 7.23 24.47 -13.26 26.00
12-month returns (%)
Source: Lipper IM as at 31 May 2020. Fund performance for the USD W (Acc.) share class calculated as total return, based on net asset value, including charges, but excluding initial charge, income reinvested gross of tax, expressed in share class currency. The impact of the initial charge, which may be up to 5%, can be material on the performance of your investment. Performance figures including the initial charge are available upon request.
For Professional Clients only. This is a financial promotion and is not investment advice. For a full list of risks applicable to this fund, please refer to the Prospectus or other offering documents. Before subscribing, investors should read the most recent Prospectus and KIID or KFS for each fund in which they want to invest. Go to www.bnymellonim.com. The Prospectus and KIID are available in English and in an official language of the jurisdictions in which the Fund is registered for public sale. The Fund is a sub-fund of BNY Mellon Global Funds, plc, an open-ended investment company with variable capital (ICVC), with segregated liability between sub-funds. Incorporated with limited liability under the laws of Ireland and authorised by the Central Bank of Ireland as a UCITS Fund. The Management Company is BNY Mellon Fund Management (Luxembourg) S.A. (BNY MFML), regulated by the Commission de Surveillance du Secteur Financier (CSSF). Registered address: 2-4 Rue Eugène Ruppert L-2453 Luxembourg. Portfolio holdings are subject to change, for information only and are not investment recommendations. BNY Mellon is the corporate brand of The Bank of New York Mellon Corporation and its subsidiaries. AUM / OUM for the following firms may include assets managed by them as non-discretionary investment manager for, or by the individual firms’ officers as dual officers or employees of, The Bank of New York Mellon: BNY Mellon Investment Adviser, Inc. and its Dreyfus Cash Investment Strategies division, Newton Investment Management (North America) Limited (part of The Newton Group). AUM for Mellon Investments Corporation includes discretionary and non-discretionary assets, the notional value of overlay strategies, and assets managed by investment personnel acting in their capacity as officers of affiliated entities. Total AUM includes BNY Mellon Wealth Management and external data. AUM outlined for Newton represents the aggregate AUM of the following affiliated companies: Newton Investment Management Limited and Newton Investment Management (North America) Limited and may include assets managed by Newton’s officers as dual officers or employees of The Bank of New York Mellon. Insight investment's assets under management are represented by the value of cash securities and other economic exposure managed for clients. The Bank of New York Mellon Corporation holds 20% minority interest in Siguler Guff & Company LLC and certain related entities. BNY Mellon owns a majority of Mellon Investments Corporation and the remainder is owned by employees of the firm. Dreyfus Cash Investment Strategies is a division of BNY Mellon Investment Adviser, Inc. In Spain, BNY Mellon Global Funds is registered with the CNMV, Registration No. 267. Issued in Spain and Portugal by BNY Mellon Fund Management (Luxembourg) S.A. (BNY MFML), a public limited company (société anonyme) incorporated and existing under Luxembourg law under registration number B28166 and having its registered address at 2-4 Rue Eugène Ruppert L-2453 Luxembourg. BNY MFML is regulated by the Commission de Surveillance du Secteur Financier (CSSF).
Important information
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MAR0001335. Exp. 18 Sep 2020
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