Simplified prospectus for sub-fund UBS Index Solutions UBS-IS Gold

Transcription

1 February 2012 Simplified prospectus for sub-fund UBS Index Solutions UBS-IS Gold Contractually based investment fund under Swiss law (Category Other Funds for Traditional Investments) Investment fund with sub-funds (umbrella fund) Fund management company: Custodian bank: UBS Fund Management (Switzerland) AG UBS AG This simplified prospectus contains a summary of the key information about the sub-fund. The detailed prospectus including the fund contract governs the legal and economic aspects definitively. These include such aspects as the rights of investors, the duties and obligations of the fund management company and the custodian bank and the investment policy of the umbrella fund. Investors are advised to consult the detailed prospectus. The annual and semi-annual reports provide information about the capital account and income statement. These documents are available free of charge from the fund management company, the custodian bank and all distributors. Investment information Investment objective The investment objective of the sub-fund is to reflect the performance of gold over the long term, after deducting the commissions and costs charged to the sub-fund. An investment in gold via the sub-fund is intended to offer an efficient alternative to a direct investment in physical gold. The sub-fund s assets are primarily invested in physical gold in a marketable form. The gold is held in bars with a standard weight of around 12.5kg and purity of 995/1000 or better. Collective depositaries are permissible for fractional holdings of up to 4 (oz.) of gold, which creates a co-ownership share for the sub-fund in physically stored bars in standard units in proportion to the corresponding ounces. The sub-fund s assets can also be invested in physical gold in the form of bars, which have been produced by a refinery, which are included on the LBMA Gold List (can be viewed at: org.uk). The weight of these bars can only be as follows: 1kg, ½kg, ¼kg, 100g, 50g, 20g, 10g, 5g, 2g, 1g and 1 fine ounce. The market price is based on the purity multiplied by the weight. Investment strategy (Investment policy) The sub-fund s assets are passively managed. As a result, the net asset value of the sub-fund s assets is directly dependent on the performance of gold. Losses that could be avoided via active management (selling gold and increasing liquidity ahead of expected price falls) will not be offset. The fund management company may also hold liquid assets in US dollars, Swiss francs and euros. Liquid assets comprise sight or time deposits with maturities of up to twelve months. The fund management company does not engage in gold lending. The fund management company does not use derivatives for this sub-fund. Listing of sub-fund unit classes on SIX Swiss Exchange An application for listing of the sub-fund s units on SIX Swiss Exchange (SIX) was submitted. The SIX Swiss Exchange Admission Board approved the application for listing. Trading in the unit classes ETF (USD) A and ETF (USD) I began on 12 January Units of the listed unit classes are traded on SIX Swiss Exchange in the relevant unit class s accounting currency. Units are listed on SIX Swiss Exchange in order to enable investors to buy and sell units on a liquid, regulated secondary market, i.e. on the stock exchange, in addition to being able to subscribe to and redeem units directly from the fund management company and its distributors. Currency of account: US dollar (USD)

2 Risk profile of the sub-fund The main risk of gold is that there is a lack of risk diversification of the type seen with securities funds due to the concentration of the investment in gold. The value of the sub-fund s units essentially depends on the value of gold; its price is subject to volatility and performance is difficult to predict. Changes in legislation and the tax situation may have a negative impact on sub-fund investments and affect the buying or selling of gold. The sub-fund is also subject to the volatility of the economic situation in emerging markets, since gold is predominantly produced in these countries. Various developments may have a detrimental effect on the value of gold, including import or export restrictions, civil unrest and international sanctions, etc. Precious metals have no par value, and listings on the international precious metal exchanges are mainly in US dollars. This means that there is a currency risk for investors for those unit classes not denominated in US dollars. The detailed prospectus contains more specific information about the risks noted here. Performance of the sub-fund Performance (USD-based): The performance shown does not take account of any commissions and incidental costs charged when subscribing to and redeeming units Indexed Indexed performance (left-hand scale) Gold London Fixing USD Performance per year (right-hand scale) in % YTD 1 Jan 2012 since Ø p.a. 2 years Fund (USD) 11,26 10,73 10,73 53,24 26,73 Benchmark 2 12,02 10,77 10,77 27,16 1 YTD: year-to-date (since beginning of the year) 2 Benchmark in currency of account (without costs) 2012 in % Average annual return: not yet available Past performance provides no indication of the future performance of the sub-fund. This depends on market developments and how successfully the asset manager implements the investment policy. Profile of the typical investor The sub-fund is appropriate for investors with a long-term horizon and risk tolerance who wish to invest some of their assets indirectly in the precious metal gold for diversification purposes in order to achieve value preservation, inflation protection and long-term capital gains. Investors are expected to be familiar with volatile investments and have a sound understanding of the gold market. Distributions All unit classes currently issued are income classes, although due to the investments held no actual distributions are expected to be made. 2

3 Unit classes The sub-fund is currently subdivided into the following unit classes: Unit class Accounting currency Initial subscription price ETF (CHF) A CHF Approx ETF (CHF) I CHF Approx. ETF (EUR) A EUR Approx ETF (EUR) I EUR Approx ETF (USD) A USD Approx ETF (USD) I USD Approx Launch date Smallest tradable lot not yet known 1 0,35% 1 Flat fee charged by fund management company p.a. not yet known 1 0,30% 1 not yet known 1 0,35% 1 not yet known 1 0,30% ,35% ,30% 1 Form of custody Appropriation of income 1 Flat fee charged by the fund management company. This covers the administration, asset management and distribution of the sub-fund, as well as the costs incurred. The amount in brackets indicates the level of the management fee, which accounts for 80% of the flat fee. Detailed information on the unit classes is contained in the fund contract (cf. Part II, 6 prov. 4). The unit classes are not segmented assets. Accordingly, the possibility that a unit class may be liable for the liabilities of another unit class cannot be ruled out, even though costs as a rule may only be charged to the specific unit class benefiting from a specific service. Economic Information Remuneration and incidental costs Remuneration and incidental costs 2009 Remuneration and incidental costs incurred directly by the investor when subscribing to and redeeming units Subscription of units 5% via custodian bank in Switzerland max. Redemption of units 2% via custodian bank in Switzerland max. Commission for payments in kind involving physical gold in Switzerland Remuneration and incidental costs charged to the sub-fund s assets on an ongoing basis Flat fee charged by fund management company Management fee charged by target funds 3% in which investments are made, max. Total expense ratio (TER) *) (excluding securities transaction costs) Portfolio turnover rate (PTR) **) according to Swiss Funds Association (SFA) Maximum of 0.10% of countervalue for standard unit of bars of approximately 12.5kg or for other common units with standard purity of 995/1,000, no VAT. Other costs to be covered by the investor (mintage, delivery, insurance, deduction for purity differences, etc.) may be charged on the basis of the actual costs involved. as per table above *) Figures not yet available when the simplified prospectus was being produced. **) Since there is no active trading in gold and changes in holdings essentially reflect net issues or redemptions, the portfolio turnover rate (PTR) is not calculated due to its lack of meaningfulness. The flat fee can be used in full or in part for distribution remuneration and/or for reimbursements granted to specific types of investors. Fee-sharing agreements and soft commissions There are no fee-sharing agreements. Tax aspects (sub-fund) The sub-fund has no legal personality in Switzerland. It is subject to neither income tax nor capital gains tax. The fund management company shall apply for a refund of all Swiss federal withholding tax levied on the sub-fund s domestic income on behalf of the sub-fund. Any income and capital gains realised abroad may be subject to the relevant withholding tax deductions imposed by the country of investment. These taxes are, as far as possible, reclaimed by the fund management company on behalf of investors resident in Switzerland under the terms of double taxation treaties or other such agreements. 3

4 Tax aspects (investors with tax domicile in Switzerland) Income distributions made by the sub-fund to investors domiciled in Switzerland are subject to Swiss federal withholding tax (tax at source) at a rate of 35%. Capital gains are not subject to withholding tax provided they are distributed with a separate coupon or listed separately in the statement sent to the investor. Investors domiciled in Switzerland may reclaim Swiss withholding tax by declaring it in their tax returns, or by submitting a separate application for a refund. Tax aspects (investors with tax domicile abroad) Income distributions made by the sub-fund to investors domiciled outside Switzerland are subject to Swiss federal withholding tax (tax at source) at a rate of 35%. Capital gains are not subject to withholding tax provided they are distributed with a separate coupon or listed separately in the statement sent to the investor. Investors domiciled abroad are able to reclaim withholding tax, if applicable, under the terms of double taxation agreements (DTA) with Switzerland. Income distributions resulting from liquid assets for the Gold sub-fund, as the sub-fund s assets are invested in gold, which does not generate income are not subject to European savings tax in Switzerland. No value added tax is currently charged on the purchase of gold. The fund management company is entitled to reclaim any value added tax for the sub-fund charged on the purchase of gold. During the period between payment of the VAT amount on the purchase price and receipt of the tax refund, this amount will be offset by borrowing in order to maintain the level of investment. Other tax implications for investors who hold, buy or sell units in the sub-fund are defined by the tax laws and regulations in the investor s country of domicile. Issue and redemption of units in the sub-fund Publication of prices Unit net asset values are published for all unit classes for each day units in the sub-fund are issued or redeemed (daily) by Swiss Fund Data AG, on the Internet at in other electronic media and in Swiss and foreign newspapers. Other information is published in the Swiss Official Gazette of Commerce (Schweizerisches Handelsamtsblatt or SHAB) and by Swiss Fund Data AG ( Type and manner of acquiring and redeeming units The investor may acquire sub-fund units on the primary or secondary market. The issue and redemption of sub-fund units by the fund management company or its distributors is known as the primary market. Buying on the secondary market refers to a purchase or sale via the stock exchange. Units may be issued or redeemed on any bank business day. The fund management company and the custodian bank are entitled to reject applications for subscription at their own discretion. Issue and redemption orders entered at the custodian bank by 3:30 p.m. (cut-off time) on a bank business day (order day) will besettled on the following bank business day (valuation day) on the basis of the net asset value calculated on this date (forward pricing). For payments in kind in gold, a cut-off time of 12 noon applies so that orders can be entered at the custodian bank by 3.30 p.m. Payments in kind In the event of termination, investors in units of all currently launched unit classes of the sub-fund Gold have the right to request a payout/booking in gold (payment in kind) instead of a redemption payout in cash. The foregoing shall be subject to measures of currency policy or any other official measures which prohibit the delivery of physical gold from the respective sub-fund, or which hamper such delivery to such an extent that the custodian bank cannot reasonably be expected to proceed with a payment in kind. It is possible that, in the future, unit classes may be launched where there is no entitlement to a payout/booking in gold. The right to payment in kind from the respective sub-funds and/or unit classes is, in principle, restricted to the standard unit of 1 bar of approximately 12.5kg with the customary purity of 995/1,000 as well to other permissible investments involving common units pursuant to 8 B, C and D prov. 2 of the fund contract (bars of 1kg, 1/2kg, 1/4kg, 100g, 50g, 20g, 10g, 5g, 2g, 1g and 1 fine ounce with the customary purity of 995/1,000). Common units other than the standard unit of approximately 12.5kg shall only be provided where available and denominated in the largest deliverable units possible for the redemption calculation, in application of the manufacturing premiums valid at the time of delivery and with other costs (such as those for mintage, delivery, insurance, deductions for differences in purity, etc.) charged to the investor. The delivery times specified in the prospectus shall apply. The custodian bank and the fund management company are not obliged to comply with a request for payment in kind involving deliverable units other than the largest possible deliverable unit applicable for the redemption calculation of the respective investor. The application for payment in kind must be submitted to the custodian bank when notice is given. For the aforementioned standard unit of gold bars of approximately 12.5kg, delivery shall take place within a maximum of 10 bank business days, currently at the headquarters of the holding and delivery office in Zurich. In such an event, ownership shall be transferred at the time of delivery at the headquarters of the delivery office. The commission specified in the prospectus and fund contract shall be levied before the gold is delivered. Delivery periods for other common units shall be agreed on a case-by-case basis, and may involve periods of up to 30 bank business days. No value added tax is payable on deliveries of gold. The commission specified in the prospectus and fund contract shall be levied before the gold is delivered. 4

5 The costs for the delivery of gold in Switzerland are subject to value added tax. No deliveries shall be made outside of Switzerland. The entitlement to payment in kind for the corresponding (entitled) unit classes shall be maintained even in the event of the liquidation of the sub-funds or the umbrella fund. This entitlement is restricted to the gold held by the individual sub-fund, however. If an investor decides to avail him- or herself of the payment in kind option, the information required in order to process the transaction (e.g. client s account number, client s identity) must be disclosed to the fund management company via the custodian bank. With the payment in kind instructions, the investor authorises the custodian bank to proceed with said disclosure. The order may otherwise be rejected. Brief description of the sub-fund Inception date of the sub-fund 2009 under Swiss law Financial year 1 July to 30 June Securities no. Unit class ETF (CHF) A Unit class ETF (CHF) I Unit class ETF (EUR) A Unit class ETF (EUR) I Unit class ETF (USD) A Unit class ETF (USD) I ISIN Unit class ETF (CHF) A CH Unit class ETF (CHF) I CH Unit class ETF (EUR) A CH Unit class ETF (EUR) I CH Unit class ETF (USD) A CH Unit class ETF (USD) I CH Ticker Unit class ETF (CHF) A AUCHA Unit class ETF (CHF) I AUCHI Unit class ETF (EUR) A AUEUA Unit class ETF (EUR) I AUEUI Unit class ETF (USD) A AUUSA Unit class ETF (USD) I AUUSI Life (of the sub-fund) unlimited Promoter UBS AG, Zurich and Basel Fund management company UBS Fund Management (Switzerland) AG, Basel Asset manager UBS Global Asset Management, Zurich Delegation of specific tasks UBS Fund Services (Luxembourg) S.A. Custodian bank UBS AG, Zurich and Basel External auditors Ernst & Young Ltd., Basel Supervisory authority Swiss Financial Market Supervisory Authority FINMA, Berne Contacts In Switzerland: UBS Fund Management (Switzerland) AG Brunngässlein 12, CH-4002 Basel Tel.: +41 (0) or on the Internet: In Liechtenstein: Liechtensteinische Landesbank Aktiengesellschaft Städtle 44, FL-9490 Vaduz 5