Three Investment Strategies For A Post-COVID World

IRVINE, CA / ACCESSWIRE / May 27, 2021 / According to a new survey by UBS, 70% of investors are optimistic about the economic outlook for the next 12 months.¹ At The Price Group in Irvine, CA, they share that optimism, and are actively preparing their clients for life beyond COVID.

The Price Group, advisors.ubs.com/thepricegroup, is a multigenerational team of financial advisors who manage just over $1.6 billion for high net worth individuals, families and business owners.² The team seeks to take the emotions out of investing, give their clients clarity about the future and help them find fulfillment in life.

“We are a family practice dedicated to serving our clients by helping them define, prioritize and pursue what matters most in life.” – Cameron J. Price, CFP®, Account Vice President

As proactive and forward-thinking advisors, the team adjusts clients’ portfolios based on changes in market fundamentals and economic outlooks. Today, they are pursuing opportunities that are emerging as concerns about COVID-19 subside. These fall into three broad themes:

1. A world that is returning to normal. Despite continued uncertainty, there are several positive signs on the horizon. Business owner confidence is at 84%, with hiring and business investment plans up significantly due to progress on vaccinations.¹ This increased activity can bolster the economy, particularly the areas that were hardest-hit by the pandemic.

For the near term, UBS recommends focusing on economically sensitive market sectors such as financials, energy and consumer discretionary names. With roughly $2 trillion in excess savings,³ U.S. investors have plenty of cash to fuel pent-up demand for travel and leisure.

That said, UBS believes the digital transformation of our economy is proceeding rapidly. For longer-term portfolios, investors should consider disruptive sectors such as green energy, financial technology and health care technology.

2. The hunt for yield. The global research team at UBS expects interest rates to stay at very low levels for the foreseeable future, and at negative levels after accounting for inflation.³ This means that income-oriented investors will need to look beyond high-quality bonds and cash for attractive yields.

The Price Group is designing portfolios that take a more active approach to generating income by incorporating dividend-paying stocks, preferred stocks, real assets and real estate investment trusts (REITs). In order to avoid taking on excess risk, they conduct rigorous due diligence on each investment, and they are mindful about avoiding overvalued areas of the market.

Another way to balance the need for yield and safety is to identify how much cash is necessary to meet current spending needs and provide a cushion against market declines. The team works with clients to design liquidity strategies that reflect their specific needs, and then encourages clients to invest the rest for future growth, rather than keeping too much cash on the sidelines.

3. Reflation and potential inflation. As vaccinations increase and fiscal stimulus continues to flow, UBS expects to see a reflationary environment. Reflation occurs when policymakers try to bring economic growth back up to long-term rates through fiscal or monetary support. Areas that may benefit from reflation include financials and energy, particularly oil stocks.

Of course, reflation could turn into inflation if things heat up too fast. Fully 61% of investors expect inflation to rise over the next three years.¹ A large percentage of the $1.9 trillion COVID relief package has yet to be spent, leaving plenty of dollars to chase a limited supply of goods and services.

In a rising cost world, low-yielding bonds and cash will lose purchasing power even more quickly. This trend supports the idea of allocating a larger portion of clients’ portfolios to equities and less to fixed income. Real assets and REITs may also offer a hedge against inflation.

What hasn’t changed?

While The Price Group actively navigates the markets and the economy on behalf of their clients, they base their financial plans on the fundamentals and economic indicators. The team helps clients minimize the cycles of fear and greed by emphasizing their long-term goals and measuring their progress toward those goals. The plans they design incorporate three timeless strategies for success:

Asset allocation: The advisors at The Price Group strategically spread clients’ assets across stocks, bonds and cash in a customized investment mix that reflects their risk profile and time horizon. Because different asset classes may react differently to changing market conditions, when one area suffers a decline, another may increase in value and offset that decline. Asset allocation can help investors ride out the market’s ups and downs while pursuing a more consistent return.

Diversification: Within their clients’ allocations to each asset class, the team drills down to sectors, styles and regions in order to spread clients’ assets and further minimize risk. Within stocks, they diversify across large and small companies, as well as growth-and value-oriented companies. Within fixed income, they hold government, corporate and high yield bonds to ensure a mix of securities with different levels of default risk and sensitivity to interest rates. They also invest across domestic and international stocks and bonds. Note that asset allocation and diversification do not guarantee a profit or protect against loss in a declining financial market.

Rebalancing: Everyone knows they should buy low and sell high, but human nature makes it difficult to follow through. A strategy of regular rebalancing can help. Depending on each client’s needs, the team will realign their portfolios back to their target asset allocation on a monthly, quarterly or annual basis. This approach can help clients navigate difficult market environments and mitigate risk.

“In an uncertain world, the fundamental importance of asset allocation, diversification and rebalancing cannot be overstated.” – Dana B. Terry, CRPC®, Senior Vice President-Wealth Management

Where do I go from here?

The team includes Financial Advisors in the UBS Portfolio Management Program (PMP), who can create custom asset allocations and manage discretionary portfolios for their clients. They draw on the global research and deep resources of UBS, one of the world’s largest wealth managers. Clients appreciate the ability to delegate the day-to-day management of their portfolios to The Price Group, so that they can focus on what they love to do.

“With our discretionary portfolio management services, we seek to take the guesswork – and the emotions – out of investing.” – Christopher R. Price, Managing Director, Senior Portfolio Manager

If you’ve been sitting on the sidelines, unsure of how to invest in these unusual times, or if you would like a second opinion about your financial situation, give The Price Group a call. You will be treated like family.

The Price Group
UBS Financial Services Inc.
20 Pacifica Suite 1500
Irvine, CA 92618
949-453-5183
https://advisors.ubs.com/thepricegroup/

¹ UBS Investor Sentiment, “A shot in the arm for investor confidence,” April 2021.

² As of April 2021.

³ UBS House View, “Year Ahead 2021: A year of renewal,” January 2021.

About the PMP Program: PMP is a wrap fee advisory program in which our Financial Advisors manage client accounts on a discretionary basis. PMP is designed for clients who (i) want to delegate portfolio management discretion to their Financial Advisor; (ii) are looking to implement a medium to long-term investment plan; and (iii) prefer the consistency of fee-based pricing.

PMP is not appropriate for clients who: (i) want to maintain trading control over their account; (ii) seek a short-term investment; (iii) want to maintain consistently high levels of cash, money market funds, or invest primarily in no-load mutual funds; (iv) want to maintain highly concentrated positions that will not be sold regardless of market conditions; or (v) who anticipate significant withdrawals from the account.

Financial Advisors who participate in the PMP Program may also provide services to you and to other clients outside of the Program in their capacity as broker-dealer representatives and as such, may dedicate time to activities other than discretionary portfolio management. Financial Advisors who participate in the PMP Program have an incentive to recommend their services in PMP over those of third party SMA Managers in other Advisory Programs or over traditional commission based brokerage services.

Trade Allocation Practices and Conflicts of Interest: Financial Advisors do not aggregate orders across the different strategies they manage. In an effort to reduce market impact and to obtain best execution, your Financial Advisor may purchase or sell securities in bulk (or orders may be “batched”) on the same day for some or all PMP accounts in the same strategy managed by the same Financial Advisor. In such cases, all orders in a batch will receive “average pricing” and the price of securities shown on client confirmations will be the average execution price on either all of the purchases or all of the sales (as applicable) aggregated for this purpose. In addition, when executing orders, we may batch orders for your Account with orders entered for other PMP accounts in the same strategy, including those of the Financial Advisor assigned to your Account and related PMP accounts under your Financial Advisor’s control. Financial Advisors are permitted to trade in the same securities they purchase for client accounts as long as they trade their personal and related accounts in the same batch as client accounts.

Financial Advisors have broad discretion to trade their PMP Advisory Accounts and there can be no assurance that a Financial Advisor can purchase or sell the same securities for all such Accounts at the same time, or that the Financial Advisor will aggregate your orders with those of other clients and charge an average price per share or unit and, when applicable, a pro-rata share of any fees. As a result, you may receive different prices and executions for the same securities as compared to other clients investing in the same PMP strategy. In addition, although we monitor performance dispersion and other characteristics of Accounts participating in PMP, investment opportunities will not necessarily be allocated among participating Accounts proportional to their overall amount invested.

Below are some of the general risk considerations associated with the investments included in the PMP investment strategies described in this Brochure. The descriptions are not meant to be a complete list of all investment risks. For more complete information regarding fees, expenses, risks and restrictions associated with these investments please review the offering documents and marketing materials. Investors should consult their tax advisor about their specific tax situation before investing in any securities. In addition, clients should familiarize themselves with the particular market risks and the other risks associated with the specific investment.

If you would like more information about the Program or have questions about your account, please ask your Financial Advisor or refer to the firm’s Form ADV Disclosure Brochure. UBS Financial Services Inc. does not provide tax or legal advice. Please consult with your tax and legal advisors regarding your personal circumstances.

All of the recommendations made/positions held within the preceding 12-month period are available upon request. Not all recommendations/holdings should be assumed to be profitable and future recommendations/holdings may not be profitable. Past performance is no guarantee of future results. Above is an overview of the portfolio holdings in the above-stated strategy of the PMP Portfolio Manager as of the date of this report. The portfolio is actively managed and holdings may be replaced at any point in time. The actual allocation within the individual portfolios may be different due to portfolio changes, market conditions or the imposition of investment restrictions.

UBS Financial Services Inc., its affiliates and its employees are not in the business of providing tax or legal advice. Clients should seek advice based on their particular circumstances from an independent tax or legal advisor.

In providing financial planning services, we may act as a broker-dealer or investment adviser, depending on whether we charge a fee for the service. Financial plans provided free of charge are a service incidental to our brokerage relationship and the service terminates upon delivery of the plan. We provide financial planning services as an investment adviser for a separate fee pursuant to a written agreement, which details the terms, conditions, fee and scope of the engagement.

The various research content provided does not take into account the unique investment objectives, financial situation or particular needs of any specific individual investor. If you have any questions, please contact your Financial Advisors. UBS Wealth Management Research is provided by UBS Financial Services Inc. and UBS AG. For more information, please visit our website at ubs.com/workingwithus.

As a firm providing wealth management services to clients, UBS Financial Services Inc. offers investment advisory services in its capacity as an SEC-registered investment adviser and brokerage services in its capacity as an SEC-registered broker-dealer. Investment advisory services and brokerage services are separate and distinct, differ in material ways and are governed by different laws and separate arrangements. It is important that clients understand the ways in which we conduct business, that they carefully read the agreements and disclosures that we provide to them about the products or services we offer. For more information, please review the PDF document at ubs.com/relationshipsummary.

CONTACT:

Company Name: UBS Financial Services Inc.
Contact: The Price Group
Address: 20 Pacifica, Suite 1500, Irvine, CA 92618
Phone Number: 949-453-5183
Website Link: https://advisors.ubs.com/thepricegroup/

SOURCE: The Price Group

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