UBS launches its first dividend ETF in Australia
UBS Global Asset Management has launched the UBS IQ Research Preferred Australian Dividend Fund (DIV) in response to strong demand for yield.
The fund has been brought to market at a time where lower cash rates and government bond yields are driving demand for income producing investments, and an ageing population is seeking a steady source of retirement income.
The fund aims to provide access to sustainable income via the distributions of dividends and franking credits.
Bryce Doherty, head of UBS Global Asset Management, Australasia, says: “DIV follows the success of our first ETF, UBS IQ Research Preferred Australian Share Fund, which raised close to AUD200m in the first year and continues to gather momentum.
"Evidence provided by the 'Demographics' white paper shows that defensive strategies, notably sustainable income equity portfolios, are likely to outperform over the next 15 years as the Baby Boomer cohort retires. We therefore expect strong interest in DIV, our sustainable income ETF.”
DIV, managed by UBS Global Asset Management, will provide investors with exposure to a diversified portfolio of Australian listed companies rated by UBS equity research analysts. It combines the liquidity and trading flexibility benefits of an ETF with an underlying portfolio constructed by reference to UBS's equity research analysts’ expertise.
DIV tracks the UBS Research Preferred Dividend Index. This index provides exposure to a diversified portfolio of approximately 40 Australian equity securities that have been selected with the objective of providing sustainable income via the distribution of dividends and franking credits, whilst also providing exposure to the performance of stocks rated by UBS equity research analysts.
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