UBS Group has reportedly decided to drop management fees on select separately managed accounts.
According to a Wall Street Journal report, the Swiss investment bank will stop charging its wealth clients from next January. The company will get rid of SMA management fees on some of its UBS Asset Management strategies available through the single-contract SMA wrap program at its wealth management division, as well as its unified managed account platform.
The change goes into effect Jan. 13, according to the memo.
Like mutual funds and ETFs, SMAs invest in portfolios of stocks or other securities. Unlike those funds, SMAs allow some individual customization and can offer tax benefits.
Naratil told the newspaper he thinks UBS is the first firm to scrap fees clients pay to asset managers for SMAs.
Currently, UBS charges around 1% in fees for separately managed accounts. Two-thirds of the amount is received by the financial adviser, while asset manager receives the remaining for managing the portfolio.