UBS Global Outlook 2009

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  • UBS Global Outlook 2009

    1. 1. Wealth Management Research UBS global outlook 2009 Proceed with caution
    2. 2. A global leader focused on you Global presence A leading global wealth manager Wealth management presence Wealth management is our core business Historical perspective 140-year tradition serving individuals and families in Europe and the U.S. UBS Financial strength One of most well-capitalized banks with some of the strongest credit ratings in the industry
    3. 3. Wealth Management Research <ul><li>Wealth Management Research </li></ul><ul><ul><li>Designed specifically for private clients </li></ul></ul><ul><ul><li>Provides global perspective </li></ul></ul>New York São Paulo Tokyo London Zurich Hong Kong Singapore Frankfurt Madrid Hyderabad Beijing Taipei <ul><li>UBS Investment Research </li></ul><ul><ul><li>Focused on institutional investors </li></ul></ul><ul><ul><li>Also available for individual investors </li></ul></ul>
    4. 4. The economy The world slips deeper into recession
    5. 5. WMR’s outlook for 2009 Review 2008 Most developed economies entered recession in 2008, following four years of unprecedented growth The economy Outlook 2009 WMR forecasts a global economic recession
    6. 6. Asset classes Diversification still key
    7. 7. Review 2008 The financial crisis hit most assets hard in 2008 Asset classes
    8. 8. WMR’s outlook for 2009 The valuation of assets like corporate bonds and equities is relatively attractive and we recommend selectively rebuilding positions Asset classes
    9. 9. Equities Investors face another difficult year
    10. 10. Review 2008 Global equities retreated sharply in 2008 Equities
    11. 11. WMR’s outlook for 2009 Certain equities offer attractive value for long-term investors Equities
    12. 12. Bonds Corporate and government bonds moved in opposite directions in 2008
    13. 13. Review 2008 Government bonds performed relatively well in 2008 Bonds
    14. 14. WMR’s outlook for 2009 Expensive government bonds, attractive corporate bonds Bonds
    15. 15. A comprehensive approach Grow your wealth now and into the future Access funds when and where you need them Take on new opportunities and enjoy life to the fullest Safeguard what you’ve worked so hard to build Do your best for those you truly care about Your financial goals Grow your assets Manage your cash flow Maintain your lifestyle Protect what you’ve achieved Care for others
    16. 16. You and your needs are at the center of all we do You Your Financial Advisor draws on a team of specialists Your Financial Advisor Retirement services Asset management Brokerage services Estate planning Financing Cash management Insurance
    17. 17. Research designed for individual investors
    18. 18. Disclaimer In certain countries UBS AG is referred to as UBS SA. This publication is for our clients’ information only and is not intended as an offer, or a solicitation of an offer, to buy or sell any investment or other specific product. It does not constitute a personal recommendation or take into account the particular investment objectives, financial situation and needs of any specific recipient. We recommend that recipients take financial and/or tax advice as to the implications of investing in any of the products mentioned herein. We do not provide tax advice. The analysis contained herein is based on numerous assumptions. Different assumptions could result in materially different results. Other than disclosures relating to UBS AG, its subsidiaries and affiliates, all information expressed in this document were obtained from sources believed to be reliable and in good faith, but no representation or warranty, express or implied, is made as to its accuracy or completeness. All information and opinions are current only as of the date of this report, and are subject to change without notice. This publication is not intended to be a complete statement or summary of the securities, markets or developments referred to in the report. Opinions may differ or be contrary to those expressed by other business areas or groups of UBS AG, its subsidiaries and affiliates. UBS Wealth Management Research (UBS WMR) is written by, and intended for use by clients of, UBS Global Wealth Management and Business Banking. UBS Investment Research is written by UBS Investment Bank. The research process of UBS WMR is independent of UBS Investment Research . As a consequence research methodologies applied and assumptions made by UBS WMR and UBS Investment Research may differ, for example, in terms of investment horizon, model assumptions, and valuation methods. Therefore investment recommendations independently provided by the two UBS research organizations can be different. The analyst(s) responsible for the preparation of this report may interact with trading desk personnel, sales personnel and other constituencies for the purpose of gathering, synthesizing and interpreting market information. The compensation of the analyst(s) who prepared this report is determined exclusively by research management and senior management (not including investment banking). Analyst compensation is not based on investment banking revenues, however, compensation may relate to the revenues of UBS Global Wealth Management and Business Banking as a whole, of which investment banking, sales and trading are a part. At any time UBS AG, its subsidiaries and affiliates (or employees thereof) may make investment decisions that are inconsistent with the opinions expressed in this publication, may have a long or short positions in or act as principal or agent in, the securities (or derivatives thereof) of an issuer identified in this publication, or provide advisory or other services to the issuer or to a company connected with an issuer. Some investments may not be readily realisable since the market in the securities is illiquid and therefore valuing the investment and identifying the risk to which you are exposed may be difficult to quantify. UBS relies on information barriers to control the flow of information contained in one or more areas within UBS, into other areas, units, groups or affiliates of UBS. Some investments may be subject to sudden and large falls in value and on realisation you may receive back less than you invested or may be required to pay more. Changes in foreign currency exchange rates may have an adverse effect on the price, value or income of an investment. Past performance of an investment is not a guide to its future performance. Additional information will be made available upon request. All Rights Reserved. This document may not be reproduced or copies circulated without prior written authority of UBS or a subsidiary of UBS. UBS expressly prohibits the distribution and transfer of this document to third parties for any reason. UBS will not be liable for any claims or lawsuits from any third parties arising from the use or distribution of this document. This report is for distribution only under such circumstances as may be permitted by applicable law. The securities described herein may not be eligible for sale in all jurisdictions or to all categories of investors. UK: Approved by UBS AG, authorised and regulated in the UK by the Financial Services Authority. A member of the London Stock Exchange. This publication is distributed to private clients of UBS London in the UK. Where products or services are provided from outside the UK they will not be covered by the UK regulatory regime or the Financial Services Compensation Scheme. USA: Distributed to US persons by UBS Financial Services Inc., a subsidiary of UBS AG. UBS Financial Services Inc. accepts responsibility for the content of a report prepared by a non-US affiliate when it distributes reports to US persons. All transactions by a US person in the securities mentioned in this report should be effected through a US-registered broker dealer affiliated with UBS, and not through a non-US affiliate. Canada: In Canada, this publication is distributed to clients of UBS Wealth Management Canada by UBS Investment Management Canada Inc. Germany: Issuer under German Law is UBS Deutschland AG, Stephanstrasse 14 - 16, 60313 Frankfurt am Main. Bahamas: This Publication is distributed to private client of UBS (Bahamas) Ltd and is not intended for distribution to persons designated as a Bahamian citizen or resident under the Bahamas Exchange Control Regulations. Hong Kong: This publication is distributed to clients of UBS AG Hong Kong Branch by UBS AG Hong Kong Branch, a licensed bank under the Hong Kong Banking Ordinance and a registered institution under the Securities and Futures Ordinance. Singapore: Distributed by UBS AG Singapore Branch, an exempt Financial Adviser under the Singapore Financial Advisers Act. Australia: Distributed by UBS Wealth Management Australia Ltd (Holder of Australian Financial Services Licence No. 231127), Chifley Tower, 2 Chifley Square, Sydney, New South Wales, NSW 2000. © UBS 2009. The key symbol and UBS are among the registered and unregistered trademarks of UBS. All rights reserved .
    19. 19. Optional Slides
    20. 20. Currencies Fundamentals still matter
    21. 21. Review 2008 The valuation landscape was completely redrawn in the currency market Currencies
    22. 22. WMR’s outlook for 2009 Economic fundamentals will likely re-emerge as the primary factors in exchange rates Currencies
    23. 23. Listed real estate Listed real estate will remain weak
    24. 24. Review 2008 The overall listed real estate market has seen substantial losses in all regions Listed real estate
    25. 25. WMR’s outlook for 2009 Fundamentals are deteriorating Listed real estate
    26. 26. Commodities Prices should pick up in late 2009
    27. 27. Review 2008 Commodity prices dropped in response to deteriorating global economic activity Commodities
    28. 28. WMR’s outlook for 2009 Investors should maintain a reduced commodity exposure Commodities
    29. 29. Hedge funds A year of transition and consolidation ahead The use of indexes is for illustrative purposes only. Some indexes are unmanaged, are not available for direct investment and are not subject to management fees and other fees and expenses. Information about the index is derived from sources that we believe to be reliable, but we have not independently verified them and we do not warrant as to its accuracy or completeness. Alternative Investments (“ Fund” or “Funds”) is not a mutual fund and it is not subject to the same regulatory requirements as mutual funds. The Fund’s performance may be volatile, and investors may lose all or a substantial amount of their investment in the Fund. The Fund may engage in leveraging and other speculative investment practices that may increase the risk of investment loss. Portfolio assets of the Fund typically will be illiquid. The Fund may not be required to provide periodic pricing or valuation information to investors. It generally involves complex tax strategies and there may be delays in distributing tax information to investors. The Fund may charge high fees that would reduce profits. Interests of the Fund are illiquid and subject to restriction and change. An investment in the Fund is long-term, there is no secondary market for the interests of the Fund, and none is expected to develop. Interests of the Fund are not deposits or obligations of, or guaranteed or endorsed by, any bank or other insured depository institution, and are not federally insured by the Federal Deposit Insurance Corporation, the Federal Reserve Board, or any other governmental agency. Investors should consider Funds as a supplement to an overall investment program.
    30. 30. Review 2008 Hedge fund managers faced serious difficulties, with most hedge funds delivering negative returns Hedge funds Data through November 2008.
    31. 31. WMR’s outlook for 2009 The hedge fund industry will undergo much change and consolidation Hedge funds Data through November 2008.
    32. 32. Private equity Opportunities likely to arise in private equity The use of indexes is for illustrative purposes only. Some indexes are unmanaged, are not available for direct investment and are not subject to management fees and other fees and expenses. Information about the index is derived from sources that we believe to be reliable, but we have not independently verified them and we do not warrant as to its accuracy or completeness. Alternative Investments (“ Fund” or “Funds”) is not a mutual fund and it is not subject to the same regulatory requirements as mutual funds. The Fund’s performance may be volatile, and investors may lose all or a substantial amount of their investment in the Fund. The Fund may engage in leveraging and other speculative investment practices that may increase the risk of investment loss. Portfolio assets of the Fund typically will be illiquid. The Fund may not be required to provide periodic pricing or valuation information to investors. It generally involves complex tax strategies and there may be delays in distributing tax information to investors. The Fund may charge high fees that would reduce profits. Interests of the Fund are illiquid and subject to restriction and change. An investment in the Fund is long-term, there is no secondary market for the interests of the Fund, and none is expected to develop. Interests of the Fund are not deposits or obligations of, or guaranteed or endorsed by, any bank or other insured depository institution, and are not federally insured by the Federal Deposit Insurance Corporation, the Federal Reserve Board, or any other governmental agency. Investors should consider Funds as a supplement to an overall investment program.
    33. 33. Review 2008 Market turmoil took a toll on private equity Private equity Data through June 30, 2008.
    34. 34. WMR’s outlook for 2009 Periods of economic weakness and bearish sentiment have historically created the best buyout vintages Private equity Data through June 30, 2008 (does not include vintage year 2007).
    35. 35. Emerging markets Too early to increase exposure to emerging markets
    36. 36. Review 2008 Emerging markets did not decouple from the rest of the world: economic growth slowed and asset prices fell Emerging markets
    37. 37. WMR’s outlook for 2009 Growth prospects will be limited by the dislocations in international capital markets Emerging markets
    38. 38.  

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