UBS builds on property success
UBS Global Asset Management(GAM) has been awarded the top prize in the property category in theMoney Management/AssirtFund Manager of the Year Awards.
According to Assirt head of research Caroline Saunders, UBS GAM won primarily due to its strong bias to medium and small-sized listed property trusts, consistent performance, and access to the group’s wider resources — namely its direct property research in the US through UBS Realty.
This tack was enough to lift the group above the other finalists,Macquarie BankandCitigroup Asset Management.
According toMercerfigures, the UBS Property Securities Fund returned 12.2 per cent for the year ending February 2003.
UBS GAM executive director and deputy head of equities John Snowden says it has been a difficult investment environment in which to perform but the group found success in looking across the spectrum.
“I guess it’s been a pretty challenging year with a fair bit of volatility in the market. We’ve continued to cover the entire universe of property trusts and we’ve found a lot of value and have been quite successful in investing in a lot of the medium to small cap property securities,” Snowden says.
About 25 per cent of the UBS fund is invested in medium to small cap securities.
“We find a lot of opportunities in that [medium to small cap] range because a lot of these trusts simply aren’t on the investment radar screens of a lot of the other players as most brokers don’t cover them,” Snowden says.
“We see this as a competitive advantage as we do our own research and if a trust looks cheap, even if it’s relatively small, we can usually take a meaningful position.”
Snowden says his fund has a degree of manoeuvrability within the market due to its size relative to some of the other larger property funds.
“Many funds are limited in what they can do, and if they wanted to take a position in a small fund they would have to take a 30 to 40 per cent stake in it,” Snowden says.
Therefore, Snowden argues that some of the larger funds are in essence reduced to being indexed funds.
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