UBS Asset Management reduces Tips ETF price

UBS_buildingUBS Asset Management has reduced the price of one of its fixed income ETF ranges, saying strong inflows had allowed the move.

The UBS ETF Barclays Tips 1-10 Ucits ETF, which invests in Treasury Inflation Protected Securities (Tips), has had its total expense ratio reduced from 0.2% to 0.15% for the unhedged share class.

The currency-hedged shares classes are reduced from 0.25% to 0.20%.

“The fee reduction is possible thanks to the greater economies of scale achieved through the ETF’s growing [assets under management],” the firm said.

Since its September 2016 launch, the fund has raised inflows of $470 million (€438 million) and total assets are now over $600 million.

Interest in the ETF has been driven by investors seeking to protect themselves from increased concerns of rising inflation in the US following Donald Trump’s election and expectations on policy change, said Clemens Reuter, global head of investment specialists passive and ETFs.

“After an extended period of low interest rates there is growing evidence in markets of inflationary pressures starting to build, particularly in the US.”

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