Wealth management Australia Investment Strategies Of Self-Directed Investors
Wealth management Australia Investment Strategies Of Self-Directed Investors David Sokulsky, PhD Head of Investment Strategy UBS Wealth Management Australia This presentation has been prepared by UBS Wealth Management Australia Limited. Please see important disclaimers and disclosures at the end of the document. Past performance and forecasts are no indication of future performance. This applies to all performance charts and tables in this presentation. February 2015 Introduction Selfdirected investors are becoming increasingly sophisticated in terms of how they invest and what they demand of service providers
1. HNW often have complex needs 2. More focus on cashlow 3. The world has changed with lower interest rates 4. The world is their oyster 5. Need guidance and access 6. Risk has become increasingly important Misconception about HNW investors Selfdirected investors rarely come with a blank slate and have complex needs Excess property exposure Capital gains concerns Concentrated holdings
Philanthropic intentions Family / estate considerations Investing has become more difficult The economy is transitioning, yields are at record lows and markets have rallied strongly Australian economy has historically been great for local investors but is transitioning Cash no longer provides an adequate return Central bank policy is dominating markets Australian property and equity
markets are no longer 'cheap' Technology has opened up the world Investing has become global as the opportunity offshore grows and risk at home increases Australian equity market is very concentrated Geographic concentration is becoming risker Need to look offshore for global leaders and innovators Need the technology and platform to allow global access Need guidance to help them navigate the
options HNW investors often prefer to go direct but need a variety of access options and support Fee sensitive as they have often built businesses from the ground up See value in a differentiated offering with niche ideas ETFs, Managed Funds, Direct Investments, Structured Products Increased interest in hedge funds and private investments The need to manage risk becomes important
Many wealthy investors are approaching retirement and are focused on risk The GFC has shown babyboomers that volatility needs to be managed Cash flow in a low rate environment needs to be balanced with growth Diversification is the key to managing risk when most have historically had concentrated portfolios Need to provide the tools to manage and communicate risk
For illustration purposes only Whats the difference HNW investors still have a focus on Australian assets but this is changing fast Typically have had a higher allocation to Australian equities but global allocations are growing More focused on high yielding equities and hybrids for cashflow Open to adopt alternatives but still via small allocations due to perceived risk Absolute return focused not +CPI orientated
Conclusions There is very little difference between what an institution and a self-directed investor expects but their needs differ Their needs are often more complex than an institutional investor A sophisticated global offering tailored to an investors specific risk profile is now expected Portfolios have grown increasingly diversified with higher offshore allocations They expect global opportunities and nontraditional offerings to be available and accessible
Source: UBS WM Global Chief Investment Office (CIO), UBS Wealth Management as at 3 February 2015 Required Disclosures This presentation is prepared and distributed by UBS Wealth Management Australia Ltd ABN 50 005 311 937, holder of AFSL No. 231127. UBS Wealth Management Australia Limited is a subsidiary of UBS AG. UBS AG, its subsidiaries, branches and affiliates are referred to herein as UBS. This Presentation contains general information and opinion and/or financial product advice. As such, any financial product advice contained herein is not personal financial product advice and does not take into account your personal investment objectives, financial situation, tax position or other personal circumstances. You should not rely on the opinions and any recommendations in this Presentation in making any investment decisions, and you should seek personal investment advice from your financial advisor and consider the relevant offer document (including the product disclosure statement) before acquiring any financial products. This presentation should not be construed as a solicitation or an offer to buy or sell any securities or financial products. No representation or warranty, either expressed or implied, is provided in relation to the accuracy, completeness or reliability of the information contained herein, nor is it intended to be a complete statement or summary of the securities, markets or developments referred to in this presentation. It should not be regarded by recipients as a substitute for the exercise of their own judgment or inquiry. Any opinions expressed herein are subject to change without notice and may differ or be contrary to opinions expressed
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