UBS Asset Management (UBSAM) is to launch into the retail market with a range of core equity and bon...
UBS Asset Management (UBSAM) is to launch into the retail market with a range of core equity and bond funds covering the major markets.
The group, which has already registered an Oeic umbrella structure with the FSA, is to produce products covering the UK, European and US markets.
Leveraging of UBS' institutional approach, the actively managed funds, to launch by the second quarter of 2002, will aim to outperform their respective benchmark indices by 1% to 2% a year over the long-term.
UBS Asset Management includes the UK's Phillips & Drew and Binson Partners in the US which will run the retail funds. UBS also owns GAM but this is being kept as a standalone business and will not contribute to the UK retail presence now being launched.
Graham Kane, managing director and head of retail at UBSAM, said: 'We will launch a range of core funds in those areas where the bulk of assets are invested. Some 80% of all funds under management, for example, are invested in equities. Of that 80%, 44% is invested in UK equities. With 2,000 odd funds already out there, we're not looking at present to launch a comprehensive range, we will not have 46 funds. What we want to do is offer a serious alternative to other major asset management houses.'
The company will utilise existing in-house fund management talent rather than seeking to recruit specialist retail fund managers externally, and indicated that some of the new funds would mirror existing portfolios. He said: 'Clearly UBSAM has a bias towards value management, meaning value as defined by price to intrinsic value and we will be looking to harness that on some funds. However, those fund management groups that are serious players offer a range of funds, which encompass a variety of investment styles.'
He added that the retail funds would leverage off a global research base of more than 500 investment professionals.
Distribution will be entirely through the intermediary market, with marketing focusing on the mass affluent, fund of funds and private client stockbroking markets.
Kane said UBSAM is also seeking to recruit a team of eight sales people, of which five will manage intermediary relationships.
The range of sub-funds will offer both initial and trail commission. Kane also added that UBSAM will join a number of fund supermarkets once product details have been finalised, and will in time look at offering a number of Isa investment packages.
Responding to a question about the timing of UBSAM's entry into the retail market, Kane said that the company's absence from the UK retail market was an obvious gap its business proposition .
He said: 'UBSAM manages over £260bn worldwide, of which 50% is institutional and 50% retail. It is the ninth biggest asset management company in the world. The UK is the fifth biggest mutual fund market in the world and is growing and as a global player it is a market that it makes sense to be operating in.'
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