Passive and ETFs Delivering first class solutions

With over 30 years' experience in managing passive assets, we offer you the expertise to manage passive portfolios across asset classes including equities, fixed income and commodities against both regional and global benchmarks. By adopting a rigorous, rules driven approach to the portfolio construction process, we can balance your risk and transaction costs.

Passive investments
Traditional index funds

Traditional index funds

Our traditional index funds aim to deliver the return of the underlying benchmark with very low tracking error by controlling risk and maximizing value.

Customized portfolios

Customized passive investment portfolios

If you require a more bespoke approach, we can tailor a portfolio solution linked to a broad range of benchmarks, from mainstream regional and global indices to highly customized solutions, all supported by our leading edge proprietary technology.

ETFs

ETFs

Exchange Traded Funds (ETFs) can offer you the advantages of versatility, high liquidity and transparent structures. They provide opportunities for portfolio diversification in a very cost-effective, flexible fashion, combined with the security of a mutual fund.


How you can benefit from ETFs

UBS ETFs boast a variety of advantages. A wide range of ETFs in all key markets and asset classes, high quality in index replication, transparent product structures, flexible trading on and off the market, high liquidity, an extremely competitive pricing scheme and narrow bid/ask spreads as well as complete cost transparency are all features investors can expect of UBS ETFs.

The following properties are characteristics of ETFs:

ETFs provide you with the opportunity to diversify your portfolio in a very inexpensive and efficient manner by distributing risk across multiple risk carriers, allowing you to optimize the risk profile of your investment. Because ETFs track an index, you can cover an entire market with just a single transaction.

ETFs are easy to buy and sell – including on an intraday basis. Investors are able to act on market views within seconds. Due to these characteristics, ETFs can be used as part of an investment strategy in a variety of ways: for long-term growth, for short-term trading opportunities and for hedging part of a portfolio.

Like traditional funds, ETFs are mutual funds. They are unaffected by any insolvency of the ETF provider or custodian bank as the fund's assets are not included in the bankruptcy estate.

ETFs are particularly transparent investment instruments because they match the performance of the underlying index, net of fees. All key trading and other information can be viewed on an intraday basis or in real time. UBS ETFs calculate the indicative net asset value every 15 seconds during normal trading hours.

ETFs do not incur any issue or redemption surcharges – just the transaction costs of buying and selling an ETF. Moreover, only a minimal management fee is charged.

ETFs in detail

What is an ETF?

An exchange traded fund is an investment fund that tracks the performance of its underlying index and can be bought and sold on the stock exchange. Like a traditional fund, an ETF is a mutual fund and thus unaffected by any insolvency of the ETF provider. It allows the benefits of a collective investment fund yet trades like a share. ETF trading can be done on the stock exchange or over the counter at any time of the day. As ETFs are pegged to an underlying index, they are passive investment vehicles that merely replicate the performance of their underlying asset. In other words, when the underlying index increases in value, the value of the ETF increases likewise.

ETFs – a wide range

The first ETFs were listed in the US in 1993 and Europe from 1999. Since then, a steadily increasing number of them have become available. Traditionally ETFs are passive index funds but actively managed ETFs have also come into play since their authorisation in 2008 and require a portfolio management strategy.

Exchange traded funds are available on a wide range of underlying asset classes (e.g. stocks, bonds, commodities, real estate).

On the following pages you will learn everything you need to know about the use and characteristics of ETFs.