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Introduction Self–directed investors are becoming increasingly sophisticated in terms of how they invest and what they demand of service providers HNW.

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Presentation on theme: "Introduction Self–directed investors are becoming increasingly sophisticated in terms of how they invest and what they demand of service providers HNW."— Presentation transcript:

0 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

1 Introduction Self–directed investors are becoming increasingly sophisticated in terms of how they invest and what they demand of service providers HNW often have complex needs More focus on cashlow The world has changed with lower interest rates The world is their oyster Need guidance and access Risk has become increasingly important 1

2 Misconception about HNW investors
Self–directed investors rarely come with a blank slate and have complex needs Excess property exposure Capital gains concerns Concentrated holdings Philanthropic intentions Family / estate considerations 2

3 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' 3

4 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 4

5 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 5

6 The need to manage risk becomes important
Many wealthy investors are approaching retirement and are focused on risk The GFC has shown baby-boomers 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 6

7 What’s 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 7

8 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 non-traditional offerings to be available and accessible Source: UBS WM Global Chief Investment Office (CIO), UBS Wealth Management as at 3 February 2015 8

9 Required Disclosures This presentation is prepared and distributed by UBS Wealth Management Australia Ltd ABN , holder of AFSL No 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 by other business areas or divisions of UBS as a result of using different assumptions and criteria. UBS is under no obligation to update or keep current the information contained herein. UBS, its directors, officers and employees, clients or affiliates may have or have had interests or long or short positions in the securities or other financial instruments referred to herein and may at any time make purchases and/or sales in them as principal or agent. UBS may act or have acted as market-maker in the securities or other financial instruments discussed in this Presentation. Furthermore, UBS may have or have had a relationship with or may provide or has provided investment banking, capital markets and/or other financial services to the issuing entities of the financial products referred to in this presentation. Neither UBS nor any of its affiliates, directors, employees or agents accepts any liability for any loss or damage arising out of the use of all or any part of this presentation. Options, derivative products and futures are not suitable for all investors, and trading in these instruments is considered risky. Past performance and forecasts are not necessarily indicative of future results. Foreign currency rates of exchange may adversely affect the value, price or income of any security or related instrument mentioned in this presentation. To the extent that UBS has sourced any material in this presentation from a third party, UBS accepts no liability for the accuracy, currency or completeness of that material. UBS specifically prohibits the redistribution of this Presentation in whole or in part without the written permission of UBS and UBS accepts no liability whatsoever for the actions of third parties in this respect. UBS Wealth Management Australia Limited, Registered Office: Level 16, Chifley Tower, 2 Chifley Square, Sydney NSW 2000. © UBS All rights reserved. The key symbol and UBS are among the registered and unregistered trademarks at UBS.

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