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The following information is intended exclusively for the following professional/institutional investors
  • Institutions within the meaning of § 1 para. 1b of the Banking Act (i.e. credit institutions and financial services institutions);
  • Insurance companies;
  • Asset management companies, investment companies as well as foreign AIF management companies and management companies commissioned by them;
  • Pension funds and their management companies.
Important information on the content of this website

This information and the information below does not represent distribution within the meaning of § 293 of the Capital Investment Act (Kapitalanlagegesetzbuchs; KAGB).

Disclaimer
  • Investments in these products should be made only after studying the current prospectus and Key Investor Information Document in detail.
  • The information was prepared without reference to any specific or future investment objective, financial or tax situation or requirement on the part of a particular individual or group.
  • The information is intended for information purposes only and constitutes neither an offer nor a solicitation to buy or sell securities of any kind or related financial instruments.
  • The products or securities described below may be unsuitable or prohibited for sale in all jurisdictions or to certain categories of investors.
  • The following information and opinions have been compiled or arrived at based upon information obtained from sources believed to be reliable and in good faith, but are not guaranteed as being accurate, nor are they a complete statement or summary of the securities, markets or developments referred to.
  • The following details and opinions are provided without any guarantee or warranty and are for the recipient's personal use and information purposes only.
  • UBS AG and/or other members of the UBS Group may have a position in and may make purchases and/or sales of any of the securities or other financial instruments mentioned below.
  • This and the following information may not be reproduced, redistributed or republished for any purpose without written permission from UBS AG.
  • Representative in Germany for UBS Funds established under foreign law: UBS Deutschland AG, Bockenheimer Landstraße 2-4, 60306 Frankfurt am Main. Sales prospectuses, simplified prospectuses, Key Investor Information Documents, articles of association and contractual terms as well as annual and semi-annual reports of UBS Funds are available free of charge from UBS Deutschland AG or UBS Asset Management (Deutschland) GmbH, Bockenheimer Landstraße 2-4, 60306 Frankfurt am Main.
  • Units of the UBS Funds mentioned above may not be offered, sold or delivered in the US. The information mentioned herein is not intended to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments.
  • The following information and charts may contain information on performance. Past performance is not a reliable indicator of future results. The performance shown does not take account of any commissions and costs charged when subscribing to and redeeming units. Commissions and costs have a negative impact on performance.
  • If the currency of a financial product or financial service is different  from your reference currency, the return may rise or fall as a result of currency fluctuations. This information pays no regard to the specific or future investment objectives, financial or tax situation or particular needs of any specific recipient.
  • The details and opinions contained on this website are provided without any guarantee or warranty and are for the recipient’s personal use and information purposes only.
  • This and the following information does not constitute tax, legal or investment advice. Please contact your tax, legal and/or investment advisor.
  • Source for all data and charts (if not indicated otherwise): UBS Asset Management. © UBS 2023
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Trading and liquidity

As is the case with all other financial instruments, liquidity is a critical aspect of ETFs. It is of paramount importance to private and institutional investors alike that they can rapidly buy and sell ETFs when any position is to be liquidated or if cash is needed.

UBS ETFs are basically financial instruments with superior liquidity. In the case of UBS ETFs, liquidity is guaranteed by multiple market makers that commit to continuously quote buying and selling prices for a specific minimum volume during trading hours. The resulting competition ensures that bid and ask prices are close to each other, thereby keeping the spread to a minimum.

What are the two types of liquidity?

ETFs offer two forms of liquidity:

  • In the first type, liquidity is generated by trading volumes on the stock exchange (secondary market)
  • In the second, liquidity is provided by the creation and redemption of ETF units on the primary market. The latter is referred to as the creation/redemption process.

What is the creation/redemption process?

The creation/redemption process is the exchange of ETF units between the ETF and a market maker or authorized partner in return for cash or securities. When ETF units are issued (creation), market makers or authorized partners deliver either a basket of securities or cash to the ETF and receive in return the corresponding amount of ETF units, which they then make available on the secondary market for trading.

By contrast, when ETF units are redeemed, the market makers or authorized partners return a fixed number of ETF units to the ETF in exchange for either a corresponding basket of securities or else cash. In this way, new units can be created as demand increases or, by contrast, existing ETF units can be redeemed as demand decreases. Consequently, the ETF reflects the value of the security it tracks.

ETF trading in the secondary and primary market

Secondary market

Trading of existing ETF units among ETF investors, banks, brokers and exchanges

Primary market

Subscription/redemption of ETF units between authorized participants and the ETF (fund)



The creation/redemption process

Source: UBS Asset Management

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