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Investment expertise

Asymmetric, multi-asset and volatility strategies

Asymmetric, multi-asset and volatility strategies

At UBP, we believe that a good risk management process is a necessary prerequisite for a robust return-generation process. To be successful, a portfolio manager also has to be a good risk manager. We have thus set up our proprietary decision support systems and differentiate between extreme risk and ‘normal’ volatility risk. Our strategies are put in place so as to manage these two different types of risk.


Risk management plays a central role in our investment philosophy:

  • An investor’s sensitivity to extreme risk is different than it is to volatility risk (tail risk is emotionally more costly than volatility risk), as are the consequences in terms of portfolio performance.
  • Due to the effect of performance compounding, extreme risks should be avoided as much as possible, as drawdowns take time to be recovered.
  • We thus apply different techniques and strategies to manage these two different types of risk.

Investment solutions

Our investment solutions are grouped into three main categories, depending on the underlying investment universe: multi-asset class, single-asset class and overlay-only investment solutions. Each investment solution is characterised by a specific risk-management and performance-generating process.

Customised solutions

We can offer dynamic downside protection solutions on rates and equities, as well as on multi-asset class portfolios. Additionally, we can design volatility carry solutions, uncorrelated from the traditional asset classes; these allow an investor to get a premium from being short on volatility and to increase portfolio diversification.

Investment philosophy

Multi-asset class

With its convex profile, UBP’s asymmetry strategy aims to improve portfolio’s efficiency.

  • Momentum-based investment philosophy
    Systematic screening of a very large investment universe.
    A pragmatic and opportunistic mindset: it is a question of adapting the portfolios as best as possible to market developments.
  • Disciplined and systematic investment approach to limit psychological biases
    This enables any risk-taking in bullish markets to be amplified; at the same time, strict discipline aims to limit the risk of severe losses.
  • Greater emphasis on risk management
    Management of short-term risks to earn returns in the long-term;
    Prepare for many possible scenarios, even if only one of them materialises;
    Extreme negative events matter much more than volatility.

Single-asset class

Over the years, UBP has come to specialise in two single assets for which it provides specific volatility strategies: gold and European equities. The goal here is to outperform the relative indexes while minimising volatility and drawdowns (extreme risks).

More specifically, for the European equities strategy, the objective is to replicate UBP’s European equities strategy and add overlay risk management to it, offering cost-efficient downside protection. This specifically enables an investor to start investing in European equities without taking the full equity risk.

Overlay

With this strategy, the aim is to efficiently hedge the risk on an equity portfolio while minimising the cost of protection.

Investment process

The investment process blends three main elements:
a) a discretionary analysis of the general macroeconomic context;
b) an objective assessment of the prevailing market conditions, based on a set of quantitative tools; and
c) careful portfolio construction and calibration of the overlay components.

Investment team

  • Our asymmetry, multi-asset and volatility strategies team consists of six investment professionals: four portfolio managers, a quantitative analyst and an IT specialist dedicated to our proprietary decision-support system.
  • Senior managers have over fifteen years’ experience in the industry and hold advanced degrees in finance, econometrics and statistics.
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Institutional clients

With a team of more than 200 people, UBP Asset Management has built an on-the-ground presence in the world’s major markets through organic growth and selected partnerships.

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