UBS ETFIn order to proceed, you must confirm that you are an institutional investor based in Portugal.

For marketing and information purposes by UBS. CNMV registration number (Comisión Nacional del Mercado de Valores): .  Representative in Spain for UBS funds established under foreign law: UBS Bank, S.A., MARÍA DE MOLINA, 4, E-28006 MADRID. Prospectuses, simplified prospectuses or Key investor information, the articles of association or the management regulations as well as annual and semi-annual reports of UBS funds are available free of charge from UBS, MARÍA DE MOLINA Nº 4, 28006 MADRID / AVENIDA DIAGONAL Nº 640, 2º A, E-08017 BARCELONA / FERNÁNDEZ Y GONZÁLEZ Nº 2, PLANTA PRINCIPAL, E-41001 SEVILLA / C/ROGER DE LAURIA Nº 7, 1ª PLANTA, 46002 VALENCIA / COSO Nº 33, 5º A, 50003 ZARAGOZA, CANTÓN PEQUEÑO 15, 4º, 15003 A CORUÑA. Before investing in a product please read the latest prospectus carefully and thoroughly. Units of UBS funds mentioned herein may not be eligible for sale in all jurisdictions or to certain categories of investors and may not be offered, sold or delivered in the United States. 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. 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 can increase or decrease 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 in this document are provided by UBS without any guarantee or warranty and are for the recipient's personal use and information purposes only. This document may not be reproduced, redistributed or republished for any purpose without the written permission of UBS AG. Source for all data and charts (if not indicated otherwise): UBS Asset Management

Trading and liquiditySupported by multiple market makers

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

Get to know us – we gladly assist you in finding the answers you need