Shareholders of the UBS High Yield Fund and UBS Global Equity Fund have approved the mergers and reorganisations of those funds into the Nationwide Funds Group High Yield Bond Fund and Global Equity Fund.
The merger gives Nationwide approximately USD183m in new assets, and enables the company to offer a wider array of investment solutions to financial advisers and their clients.
UBS Global Asset Management will remain affiliated with the funds as their sub-adviser. The funds’ existing assets, performance histories and risk profiles have carried over to the Nationwide funds.
The new funds have lower fees than they did prior to the mergers and reorganisations.
“The Nationwide High Yield Bond Fund and Nationwide Global Equity Fund enhance our product portfolio by increasing the number of asset classes we can draw upon to assist advisors with navigating their clients through all market conditions,” says Michael Spangler, president of Nationwide Funds Group. “This latest effort to broaden our investment offerings involves partnering with an established sub-adviser to grow our business, while providing investors with the potential for higher yields and greater diversification in a market where investors are hungry for both.”
The Nationwide High Yield Bond Fund seeks to provide high current income and corresponding capital growth. It invests in a portfolio of higher-yielding, lower-rated fixed-income securities issued by US and foreign companies. The fund employs a disciplined, fundamental research-driven investment process focused on risk management, and presents an opportunity for investors to achieve higher yields at a time when interest rates are at historic lows.
The Nationwide Global Equity Fund seeks to maximise total return, including capital appreciation and current income, by using a globally integrated investment process to uncover undervalued markets, currencies, sectors and securities. The fund’s research capabilities are supported by a team of 80 analysts based around the world. Its global equities-focused strategy provides investors with an opportunity to globally diversify at a time when many advisors are encouraging their clients to further diversify their portfolios.
“These adoptions are beneficial for investors,” says Bob McGowan, managing director and head of corporate institutions at UBS global asset management. “Existing shareholders will benefit from the greater reach these funds will have through Nationwide’s distribution platform and their potential to develop economies of scale that will enable the funds to invest more flexibly. Furthermore, these funds will have broad appeal for prospective investors looking for timely strategies managed by experienced and established teams of investment professionals.”
The class A shares of both funds require a minimum investment of USD2,000. The class A shares of the Nationwide High Yield Fund and Nationwide Global Equity Fund will see their annual expense ratios decrease from 1.20 per cent to 1.10 per cent and from 1.50 per cent to 1.30 per cent, respectively.