UBS Sells Notes Linked to Index of Robotics, Drones Companies
By Luca Casiraghi
Switzerland’s largest bank is offering investors a chance to profit from the increasing use of robots and unmanned vehicles.
UBS AG (UBSN) sold securities linked to the Robotics & Drones Index, a new benchmark tracking companies that develop technology such as robot vacuum cleaners or unmanned aircraft for reconnaissance missions. The index, compiled for the Swiss bank by Solactive AG, includes robotics developers Kuka AG (KU2) in Germany and Fanuc Corp. (6954) in Japan, and U.S. drones maker Aerovironment Inc. (AVAV)
A technology boom in robots and driverless vehicles is spurring companies to use drones to reshape their businesses. Amazon.com Inc. and Domino’s Pizza Inc. are developing unmanned aircraft to speed up deliveries while Google Inc. and Facebook Inc. recently acquired drones manufacturers to help extend wireless connectivity to remote areas.
“Machines and automation will play an increasingly important role in the future,” Steffen Scheuble, Solactive’s chief executive officer, wrote in an e-mail. “Drones are at the forefront of this second phase of the industrial revolution.”
UBS issued the certificates in Swiss francs, euros and dollars and they will be traded on the SIX Structured Products Exchange from May 30, according to a sales prospectus from the Zurich-based bank. Hana Dunn, a spokeswoman for UBS in London, declined to comment on the amount of certificates sold.
Six of the nine companies listed on the Robotics & Drones index saw the value of their businesses grow by at least 50 percent in the past year, bringing their total market capitalization to $64 billion, according to data compiled by Bloomberg.
More drone manufacturers will be added as other companies adopt unmanned aircraft for commercial applications, according to Scheuble.
The notes, which offer no capital protection and can be redeemed by investors at any time, replicate all gains or losses on the index. The benchmark climbed 5 cents on the euro in the past week to 95.4 euro cents as it rebounded from a sell off in technology stocks, according to data compiled by Bloomberg.
