High hopes as UBS Wealth Management looks at year to come

UBS Wealth Management forecasts suggest corporate spend likely to create more balanced economic growth

Bill O'Neill, head of UBS's Chief Investment Office Wealth Management Research Team in the UK
Bill O'Neill, head of UBS's Chief Investment Office Wealth Management Research Team in the UK

North East businesses are approaching 2014 with a sense of cautious optimism, hiring new staff, paying down corporate bank debt and expanding into new markets, according to UBS Wealth Management.

The financial services firm’s Newcastle office last year took on three new experienced professionals - Vinay Bedi, David Scordino and Andrew Elliot - as well as several support staff as it continued to see an increase in enquires from potential clients with assets to invest.

In recent months, advisors noted a positive outlook from clients both towards their own businesses and the wider economy.

Head of regions for UBS Wealth Management UK, Jonathan Brown, said: “The concept of a post-crisis economy is reflected in the confidence of our clients and the growth of businesses here.

“In Newcastle, our business has been very strong during 2013, growing by 20%.”

The comments were reinforced by Bill O’Neill who leads UBS’s Chief Investment Office Wealth Management Research Team in the UK, playing a key role in asset allocation strategy.

In the midst of a visit to UBS offices around the country - including Newcastle - to discuss forecasts for the economy, O’Neill told the Journal that factors like improved access to credit and asset price rises, particularly around real estate, were helping bring about obvious recovery in the regions.

Consumers remained the lynchpin of the UK growth story this year, but corporate investment would also contribute to a broader-based economic expansion.

“Clearly, the UK has undergone an extraordinary transformation,” O’Neill said.

He added that the predicted 4-6% returns expected from hedge funds were increasingly attractive relative to equities, the annualised returns of which have halved since last year.,

Other current investment picks include Eurozone stocks, US technology, US financials and US high yield corporate bonds. UK mid caps are also positioned well to benefit from domestic recovery, with UBS currently advising investors to gain exposure to the FTSE 250.

However, it is warning investors against commodities, as returns are likely to be minimal.

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