UBS Global Asset Management (UBS GAM) has rolled out two new alternative beta passive funds initially for institutional investors.
The new funds, the UBS FTSE RAFI Developed 1000 Index fund and the UBS MSCI World Minimum Volatility Index fund, will be offered to retail clients in the near future.
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The funds will be benchmarked to the FTSE RAFI Developed 1000 QSR Index and MSCI World Minimum Volatility GBP Index respectively.
UBS GAM head of UK & Ireland Ian Barnes said: "While market cap weighted indices have many advantages, including broad diversification and high liquidity, they do have a systematic flaw.
"We are seeing more investors in the UK recognise the benefits that alternative beta strategies can bring to a portfolio.
"In many instances clients are opting for a combination of passive strategies, tracking both traditional and alternative indices to diversify exposure across several risk factors and drivers of returns."
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