Weak demand for the fund of hedge funds business is a reason for the move, the US firm said.

BNY Mellon Investment Management intends to wind down its multi-manager and fund of hedge funds investment house, EACM, as a standalone business, citing weak demand.

EACM managed $3.9 billion in a blend of long-only and fund of hedge funds strategies (data as at the end of August this year). EACM's fund of hedge funds strategies ($2.1 billion) will be closed to new investors and existing capital returned to investors. As part of this change, Dreyfus Select Managers Long/Short mutual fund, for which EACM is the portfolio allocation manager, is being liquidated. The process is expected to take place on or about November 30, EACM said in a statement.

Dreyfus' two long-only mutual funds for which EACM serves as portfolio allocation manager - Dreyfus Select Managers Small Cap Value Fund and Dreyfus Select Managers Small Cap Growth Fund - with combined assets of $1.8 billion - will continue to be managed within BNY Mellon Investment Management, it said.

Des Mac Intyre, chief executive of US Asset Management at BNY Mellon Investment Management and a member of EACM's Board of Directors, becomes EACM board chairman. Michael Germano, managing director of BNY Mellon Asset Management North America, will oversee the wind down of EACM during this period.

"Despite EACM's long track record, the overall demand for fund of hedge funds strategies has diminished. Following a market evaluation, we no longer see the fund of hedge funds category as a standalone offer within our US asset management portfolio given the integrated capabilities we already have elsewhere within the business," said Mac Intyre.