24 corporate finance Are investors making


the right decisions? Managing wealth has always been a complex business and today, more than ever before, investors navigating the current financial landscape have a difficult job ahead of them, says Martyn Begbour, head of UBS southern business. Here Begbour outlines the views of the UBS Chief Investment Office (CIO) and the key issues facing investors


Not only do they need to be aware of market performance, they also need insight into the macro economic environment and to understand the impact of global and local political pressures. To be comfortable that they are making the right investment decisions, investors need confidence in the quality of the research and their investment convictions.


The UBS CIO view and the key issue for investors


The three main issues of today remain the same ones investors have been facing in recent years. What is the future of the eurozone? Is the US recovery sustainable? And what is China’s growth outlook? The difference today however is that the recent economic landscape has been dominated by central bank actions, with large-scale quantitative easing programmes from the US Fed, and the Bank of Japan, and the announcement of the Outright Monetary Transactions by the European Central Bank. Meanwhile China continues to provide more traditional monetary policy stimulus.


The key question for investors then is whether anything fundamental will change as a result of this recent central bank action? Our view is that while central banks have reduced the tail risks of both a eurozone breakup and a truly synchronized global slowdown, their actions alone will not translate into sustainable economic activity. We are now in a holding pattern, awaiting effective actions from politicians in Europe, the US and China. Meanwhile geopolitical tensions in the Middle East continue to further suppress market confidence.


As a result, currently it is prudent to maintain a ‘middle ground’ investment strategy. This consists of a neutral allocation in equities,


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with a preference for corporate credit, particularly US high yield, global investment grade, and emerging markets' corporate debt. Within equities we continue to prefer the US and emerging markets, as well as real income- producing ideas such as high- quality dividend yields.


Translating the UBS global views into actions


The UBS Wealth Management CIO is the powerhouse behind our investment house view and the starting point for our investment management process. Our investment strategists analyse the daily data from a global network of economists and researchers to inform our house view. Our local investment management team then aligns these views within our portfolios. The strength of this approach gives our clients the assurance that when their adviser is discussing an investment opportunity with them, not only is it tailored to their needs, but it is also backed by this huge depth of market insight and the know- how of one of the world’s leading financial institutions.


It is also our responsibility to remind you that the price and value of investments and income derived from them can go down as well as up. You may not get back the amount you originally invested. Past performance is not a reliable indicator of future results. UBS Wealth Management is a business division of UBS AG which is authorised and regulated by the Financial Services Authority.


Details: Martyn Begbour 07887-450664 martyn.begbour@ubs.com


Funding recovery in the aftermath of recession


It’s official – the recession is over. Or so we’re told. But many businesses across the Thames Valley will find it difficult to drag themselves out of the quagmire created by the poor trading environment of recent years. This is particularly true as the banking sector remains risk averse and reluctant to lend, while many businesses are struggling to shrug off a less-than-perfect credit history as they emerge battle-weary from fighting for survival in the stormy seas of recession. But help is at hand, as Tracey Bevis, senior new business manager at Pulse Cashflow Finance, explains


In this current climate, do not accept the negativity of an inactive, unenthusiastic lender. Seek out funding facilities that are geared to the growth of your business and help finance working capital requirements, because this is where the pressure will be greatest as the increase in consumer demand that characterises recovery takes hold.


The answer is invoice finance and there are many independent finance companies that have significant funds at their disposal. Better still, they are eager to lend and pricing is competitive. Further, for those SMEs looking for add on benefits such as credit control and bad debt protection – both of which should be considered as cost-saving benefits rather than additional costs – your time is now.


When money is tight it’s easy to be swayed by price, but the cheapest lender may not offer the best value for money, so remember to think carefully about what you are getting for your money and consider how much value you are prepared to place in your provider’s reputation, expertise and the added benefits they can offer that will save your business money in the longer term.


For example, a specialist provider, such as Pulse, will be sympathetic to the financial needs of a business that has previously faced difficulties but can demonstrate that it has good quality customers and a positive order book because they gear their financing to future sales performance. And for those businesses which struggle with credit control, they also offer the


Tracey Bevis


services of experienced credit control professionals. They will not only ensure that payments arrive on time, without upsetting the delicate balance of customer relations between you and your customers, but also carry out credit checks and offer bad debt protection against the potential threat of insolvency from all, or specific, customers.


Clearly there’s an associated cost but such added benefits offer real value for money, at a time when it’s imperative to make every penny count. So do the sums and plan your way to a successful recovery.


Details: Tracey Bevis 0845-539-7003 enquiries@pulsecashflow finance.com


THE BUSINESS MAGAZINE – THAMES VALLEY – DECEMBER 12/JANUARY 13


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