UBS launches loan product
UBS has launched a new product – a limited recourse loan with no margin calls.
The company launched the product, UBS Investment Builders, this week claiming it would investors the ability to purchase shares, exchange traded funds (ETFs) and listed managed funds by paying a portion of the underlying security price themselves, while UBS then provided a limited recourse loan for the balance of the purchase price.
It said a key feature of buying the underlying shares through UBS Investment Builders was that investors became the beneficial owner and received exposure to price performance, dividends and potential franking credits.
The company claimed superannuation funds would be able to use UBS Investment Builders as one of the few ways to borrow to invest in listed shares and ETFs.
Commenting on the product, UBS head of derivative sales, Travis Miller said the product was innovative because it combined a limited recourse loan with a share or ETF that could be purchased on the ASX in a similar way to buying shares outright.
"UBS Investment Builders also offer individuals and SMSFs the benefits of potential interest deductions and franking credits, and in the case of UBS Dividend Builders, access to potentially enhanced dividend income streams,” he said.
Recommended for you
Sequoia Financial Group has announced it is selling off its Informed Investor subsidiary which it acquired in April 2022.
Wealth Data has examined which advice business model has seen the most growth since the start of the year including those that offer holistic advice.
Research conducted by Elixir Consulting and Lonsec has quantified the efficiency gains of using managed accounts in financial advice practices in hours per week saved.
With only one-quarter of advice practices actively seeking feedback from clients, the Financial Advice Association Australia has emphasised why this is a critical tool for client retention.
