UBS Asset Management Introduces Treasury Yield Plus Exchange-Traded Funds
In a bid to cater to the growing investor demand for funds that go beyond traditional passive benchmarks, UBS Asset Management (UBS AM) has launched two Exchange-Traded Funds (ETFs) aimed at delivering enhanced yield. These new ETFs, denominated in euro and dollar, offer a higher yield than government bonds. To achieve this, UBS AM employs a proprietary rules-based model that broadens the investment universe of the ETFs, enhancing access to a larger opportunity set. The model is designed to expand the opportunity set for each ETF, allowing it to include high-quality sovereign, supranational, and agency bonds. Despite this broader scope, the ETFs maintain tight alignment on duration, credit quality, and country exposure with their respective Bloomberg Treasury Indexes. The goal of these ETFs is to outperform their respective Bloomberg Treasury indexes by targeting higher option-adjusted spread. Each ETF starts with its respective Bloomberg Treasury Index (EUR or USD). UBS AM offers its rules-based strategy capability for the first time to a wider range of clients through the ETF wrapper. The manager of these two ETFs, which offer increased return potential while maintaining the risk profile of the underlying treasury bond indices, is UBS Asset Management itself. The enhanced fixed income ETFs launched by UBS AM are registered for sale in multiple European countries, including Austria, Denmark, Finland, France, Germany, Ireland, Italy, Liechtenstein, Luxembourg, Netherlands, Norway, Spain, Sweden, Switzerland, and the United Kingdom. This move by UBS AM underscores the increasing demand for alternative investment solutions that can provide higher yields while maintaining a manageable level of risk. The launch of these ETFs is a testament to UBS AM's commitment to delivering innovative investment solutions to its clients.
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