UBS Tactical Beta Fund


This week Money asks Lonsec where to invest and their pick is the UBS Tactical Beta Fund.

The UBS Tactical Beta Fund is designed as a low-cost product, offering investors access to a diversified range of assets including Australian and global equities, global property securities, bonds, cash and currencies. The underlying asset classes are passively-managed, typically accessed via ETFs. An active Tactical Asset Allocation (TAA) overlay is intended to be a key driver of the fund's returns.

Low-cost diversified funds are well suited to investors who want a portfolio that provides exposure to a range of asset classes via a single investment option at a lower cost than traditional diversified funds. UBS offers conservative, balanced and growth options of the fund, depending on investor risk tolerance.

UBS tactical beta fund

Lonsec upgraded the fund's rating to Highly Recommended in late 2014. Lonsec believes that the fund is a particularly attractive offering in the low-cost space because it offers investors competitively priced access to a world class investment capability. The static asset allocation combined with passive management of the underlying sector building blocks allows UBS's TAA to stand out as a feature of the fund.

Lonsec considers UBS to be more 'total return' focused than its assessed peers and is less focused specifically on Tracking Error management given the investment approach. Importantly, Funds' respective positioning could diverge notably from their 'neutral portfolio' exposures--although Lonsec notes this is rare. A strong risk budgeting framework is applied to manage overall portfolio risk which Lonsec believes can effectively manage the consequence of unintended risks.

The Tactical Asset Allocation process (TAA) is considered to be highly accountable with individual team member's trade ideas being linked directly to their KPI's and 'live' portfolios. A quantitative approach, with inputs/forecast provided by the GIS, is used to help guide the decisions. UBS's internal systems (e.g. Trade Tracker) and processes (e.g. Cyclical Market Forum) are strengths of the overall process. Lonsec considers the high quality of the Tactical Beta product range's TAA overlay process to be one of its key competitive advantages.

UBS fund graphUBS Tactical beta fund features

Disclaimer: Any general advice in this electronic communication does not take into account you or your client's personal objectives, financial situation and needs. Please seek advice from a financial adviser and/or broker and read the relevant Product Disclosure Statement and/or Prospectus, before making a decision in relation to any investment.


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