UBS Global Asset Management has listed eight smart beta ETFs on the London Stock Exchange.
Key features
■ The new UBS ETFs are based on the factor premium concept developed by financial market researchers Kenneth French and Nobel Prize-winner Eugene Fama.
■ They will allow investors to gain exposure to systematic factor high-exposed strategies on the US and Eurozone equity markets.
■ UBS says its factor ETFs now provide the opportunity to invest in four factor-based strategies in a transparent and cost-efficient manner.
■ These factors are derived from the broad markets, MSCI USA and MSCI EMU, ensuring consistent construction, alongside existing market capitalsation building blocks.
Andrew Walsh, head of UBS ETF sales, UK & Ireland, said: “Whether one chooses to call it ‘factor investing’, ‘smart beta’ or ‘alternative beta’, what is very clear is that this category continues to gain increased interest from investors who are looking beyond the traditional parameters of market cap-weighted benchmarks.”
Adviser view
Gary Bond, managing director of West Midlands-based Broughtons Financial Planning, said: “It is fashionable at the moment, but I am very cynical of smart beta, and I am reluctant to get away from traditional investing, so I am sticking with active and passive.
“The concern I have is that it creates distortions in market pricing.”
