UBS to Launch Target-Date CITs with Morningstar

The CITs will be based on Morningstar Indexes and sub-advised by Morningstar Associates.

UBS Global Asset management is launching a target-date collective investment trust product line for qualified retirement plans.

UBS Global Asset Management Trust Company (UBS), a member of the UBS Global Asset Management division of UBS Group AG, will run the collective investment trust (CIT) products. The CITs seek to track the performance of the Morningstar Lifetime Allocation Indexes.

UBS expects to launch the CITs, which are for use exclusively by qualified retirement plans, in July. Morningstar Associates LLC, a registered investment adviser and part of the Morningstar Investment Management Group, will serve as a nondiscretionary sub-advisor with respect to the CITs. Morningstar, Inc. is the index provider.

“UBS Global Asset Management has been managing passive portfolios for more than 30 years,” notes Blake Moore, head of Americas for UBS Global Asset Management. “Our experienced index investment professionals around the globe manage passive portfolios across asset classes including equities, fixed income and commodities. We are pleased to work with Morningstar to bring these CIT funds to defined contribution plans.”

The CITs are available in three series—conservative, moderate, and growth—and will represent passively managed, low-cost investment selections. UBS is licensing the Morningstar Lifetime Allocation family of indexes as the benchmarks for the CITs. Launched in 2009, the Morningstar Lifetime Allocation Indexes comprises three series of target-date indexes that vary in aggressiveness and adjust their asset allocations over time to become more conservative. The indexes leverage Morningstar’s “total wealth approach” to investing—a concept that goes beyond looking at an individual’s current wealth, and takes into account his or her personal prospects, goals, and resources when building portfolios.