BNY Mellon Asset Servicing has introduced fair value pricing, an automated system for valuing non-US equities after the European and Asian markets close. The system, recently launched with a major mutual fund complex, provides updated valuations until the closing of the New York Stock Exchange (NYSE).

Fair value pricing is a tool an institution such as a mutual fund can use to help them determine the value of the securities in a portfolio if a significant event occurs after the close of the markets that trade those securities. This will enable a more accurate net asset value (NAV) or unitised value to be calculated.

It also provides a standard method for a fund close price where securities are traded in multiple markets, providing more accuracy in price for participants entering or exiting a fund or plan.

The automated system gathers data from multiple vendors and a factoring agency. The factor determines a daily multiplier that is used to alter the closing prices of these securities in their native markets.

Using the multiplier brings the prices of the securities to a fair value that reflects events that impact stock prices between the closing of the native markets and the closing of the NYSE. There is an option to determine the fair value of their securities through either the data vendors or the factor.

BNY Mellon Asset Servicing offers a broad spectrum of specialised asset servicing capabilities, including custody and fund services, securities lending, performance and analytics and execution services. BNY Mellon Asset Servicing provides services through the Bank of New York Mellon and other related companies.