By introducing a new high-income strategy called UBAM – Strategic Income in December 2022, Union Bancaire Privée (UBP) has further increased the scope of its fixed income offering.
The goal of UBAM – Strategic Income is to generate a high level of income while maintaining a low risk profile (BB-rating).
In addition, the fund seeks to return 7% per year across the investment cycle by allocating to high-income parts of global credit markets such as high-yield bonds, subordinated corporate and financial debt, and securitised credit and collateralised loan obligations (CLOs).
The manager of the new strategy is Philippe Gräub, who is assisted by Thibault Colle and Bernard McGrath, portfolio managers at UBP’s Global and Absolute Return Fixed Income division.
Over $13bn in assets are managed globally by this group of 14 investment experts.
By using the team’s current experience, the Strategic Income solution makes sure that at least one investing professional covers each section of the fixed income market.
For portfolio allocation, relative-value analysis is continuously employed to establish the weight of each segment, and individual issues are chosen based on thorough fundamental investigation.
Nicolas Faller, co-CEO of asset management at UBP, said: “This new fund represents another valuable building block to complement UBP’s Global & Absolute Return Fixed Income range. Supported by the current macroeconomic backdrop, this solution intends to seize the opportunities recently created across the asset class while meeting our clients’ growing demand for innovative high-income solutions”.
Philippe Gräub, head of UBP’s Global & Absolute Return Fixed Income team, added: “Over a long investment horizon, BB-rated bonds have delivered materially higher returns than BBB bonds, despite displaying similar volatility. We believe this is due to technical rather than fundamental factors. We are convinced that investing in this area of credit markets and diversifying broadly across segments, sectors and issuers can deliver high income to investors.”
Investors can now purchase shares of the fund in Austria, Belgium, Finland, France, Germany, Italy, Luxembourg, the Netherlands, Norway, Portugal, Singapore, Spain, Sweden, Switzerland, and the United Kingdom.