“Most funds tend to revolve around one portfolio’s manager’s views of the world. You just can’t run hundreds of billions of dollars, or in our case trillions, that way. You can’t be a fiduciary that way.”
June 8, 2014 Leave a comment
June 2, 2014 10:33 pm
UBS investment chief poised to quit company
By James Shotter in Zürich
Alexander Friedman is to step down as UBS’s global chief investment officer after three and a half years to pursue “a new opportunity outside the firm”.
The Swiss bank said that Mr Friedman, a former chief financial officer of the Bill & Melinda Gates Foundation, would be succeeded by Mark Haefele, head of the bank’s global investment office.
Mr Friedman joined UBS in 2011 to set up the bank’s chief investment office (CIO), an entity which sits at the heart of UBS’s wealth management arm, and which helps manage the nearly $2tn of wealthy clients’ assets held by the bank.
The unit was responsible for introducing a standardised investment process and for melding UBS’s army of analysts into a single “house view” on every asset class in every region of the world.
Mr Friedman said that the process had been a key change in how UBS managed rich clients’ money.
“Most fund managers are simply hedge funds. They tend to revolve around one portfolio’s manager’s views of the world. You just can’t run hundreds of billions of dollars, or in our case trillions, that way,” he said. “You can’t be a fiduciary that way.”
UBS’s wealth management arm was hit hard during the financial crisis, as clients withdrew money over fears about the bank’s future after it made huge losses on mortgage-backed securities. However, it has recovered ground in recent years, and last year drew in SFr53.5bn in net new money.
UBS said that it planned to invest further in the CIO, and in particular in its research capabilities in emerging markets, such as Asia, and in alternative asset classes.
Mr Haefele, who was previously managing director at Matrix Capital Management, and before that was co-founder and co-portfolio manager at The Sonic Funds, said that the changes were an evolution of the strategy that UBS had developed since 2011, and that greater focus on emerging markets was the next step.
“Growth expectations, while positive, are modest. Central bank policy is going in different directions. Assets are closer to fair value than a year ago,” he said.
“This creates a challenging environment where you need to dig deeper into regional growth, and where there are opportunities to find returns by distinguishing between assets on a more granular basis.”
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