UBS offers innovative multi-manager solutions for pension funds and retirement accounts
For the first time on the Swiss pensions market, the UBS Foundation for the Investment of Pension Fund Assets (AST) is launching products which not only provide diversified investments but also diversified management and thus investment processes.
The AST is extending its offering to include the following four investment categories: domestic and foreign multi-manager bonds denominated in CHF, Swiss multi-manager equities, global multi-manager bonds in foreign currencies and global multi-manager equities. Each of these four investment categories in turn invests in three institutional investment funds under Swiss law, managed by third-party institutions. The expanded product line allows occupational pension schemes to freely combine investment categories managed by UBS Asset Management and third-party institutions, thereby reducing the risk of fluctuation in investment results.
The managers are selected and continuously assessed, and the entire process monitored, on the basis of objective criteria and institutional best practice. To achieve this, UBS is working in partnership with one of the leading Swiss consultants to institutional investors, PPCmetrics AG. The active managers which have been selected are well-known Swiss and foreign institutions with a high degree of specialization, an excellent reputation and proven potential for above-average investment results.
The new multi-manager concept, currently unique on the Swiss pensions market, will be introduced in stages from the fourth quarter onwards and is primarily aimed at occupational pension scheme providers which are not large enough or do not possess the appropriate organizational structures to pursue their own strategy of manager diversification. This new solution also offers total multi-manager diversification from a single provider to smaller institutional investors, as is normal for the largest institutional investors.
Holders of private UBS pensions (Fiscainvest clients) will also benefit from the new multi-manager concept. Three quarters of Fiscainvest's partial assets will be invested in the new investment instruments. This, together with the portion managed by UBS Asset Management, will ensure that client assets are managed by a range of different managers.
Institutional best practice
The aim of the multi-manager concept is to offer institutional best practice. This means:
Wealth management by the "best of breed" asset management companies in each investment category
Diversification at the stock level
Diversification at the asset manager level
Best execution when processing securities transactions
Continuous investment controlling
Transparent and meaningful reporting
Process monitoring by an objective, well-known consultant
The prerequisites for implementing institutional best practice are: a sufficient investment volume, appropriate organizational structures and a high degree of specialization in wealth management.
Zurich / Basel, 11 September 2001