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UBS launches ‘borrow to invest’ product

Katarina Taurian
23 October 2014 — 1 minute read

UBS has launched a product that allows investors, including SMSF trustees, to build a portfolio using borrowed funds.

According to an announcement from UBS, the ‘Investment Builders’ product allows investors to purchase shares, exchange-traded funds and listed managed funds by paying a portion of the underlying security price themselves, while UBS provides a limited recourse loan for the balance of the purchase price.

By purchasing the underlying shares through the product, investors become the beneficial owner and receive exposure to price performance, dividends and potential franking credits.


“Obviously there has been a whole range of borrowing on direct property, specifically residential property, but we are not interested or involved in that space at all,” Pete Mermelas, director of equity products at UBS told SMSF Adviser.

“This [product] is really around equities in the markets and specifically the top 50 ASX shares… as well as a couple of ETFs.”

The product is available to superannuation funds and can have specific benefits for SMSF trustees, according to UBS.

"UBS Investment Builders also offers individuals and SMSFs the benefits of potential interest deductions and franking credits,” said Travis Miller, UBS head of derivatives sales.

Mr Mermelas explained that there are no limitations on the amount that can be borrowed, other than the $500 minimum investment amount that all ASX products are subject to.

UBS launches ‘borrow to invest’ product
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