“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 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.”

 

About bambooinnovator
Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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