UBS Financial Services and NextShares Solutions, a wholly owned subsidiary of Eaton Vance, have launched a partnership through which NextShares exchange-traded managed funds will be offered as part of UBS investment solutions set for financial advisors.

As a result of the agreement UBS will become the first full-service wealth manager to offer NextShares through its financial advisor network. In addition, UBS Asset Management (Americas) has also confirmed plans to enter into an agreement with NextShares Solutions to support the development and launch of UBS-sponsored NextShares funds in 2017.

Jeff Miller (pictured), head of advice and platforms at UBS Wealth Management, welcomed the agreement as Nextshares will provide UBS with an opportunity to offer "what we believe is an industry changing structure to improve client outcomes".

"NextShares offer actively-managed strategies coupled with greater cost and tax efficiencies than mutual funds that can enhance shareholder returns," said Miller. "This move demonstrates our commitment to innovative solutions that better support our financial advisors and clients - as well as our continuous investment in our platform capabilities to bring these solutions to our clients."

UBS wealth management business is focused on managing portfolios of high net-worth and ultra-high net worth individuals with different underlying strategies and investment vehicles, including mutual funds, ETFs and individual securities such as structured notes, and the agreement is in line with market trends and developments, according to Miller.

"The recent shift towards ETFs has been driven by a number of factors including the ability of passive investing to perform in a low return environment," said Miller. "We believe the NextShares range of products will help traditional active managers remain relevant in an environment where total fees are more and more important."

Miller said that UBS Wealth Management will continue to invest in its capabilities and expand its offering to meet the needs of clients, including adding new investment structures that can improve client outcomes. "Our mission is to be the platform of choice for financial advisors serving HNW/UHNW clients," said Miller.

NextShares offers actively managed strategies, and the potential for "benchmark-beating returns" by applying their manager's proprietary investment research, as is in talks with a range of "well-known asset managers" to offer NextShares across fund asset classes, according to Stephen Clarke, president at NextShares Solutions.

"We own the intellectual property upon which the NextShares funds are based," said Clarke. "Our business is about licensing and servicing fund sponsors that have deployed our technology with our know-how and experience. Our goal is to help and coordinate efforts between the investment managers and UBS Wealth Management Americas to make these products available."

Clarke anticipates that NextShares exchange-traded managed funds will resonate with investment managers who will be able to "deploy existing strategies in a new structure that is designed to bring down the cost and deliver potentially better performance with improved tax efficiency".

"The NextShares product structure covers all asset classes," said Clarke, adding that the firm is well positioned to deliver any type of investment strategy that can be delivered through ETFs.

Clarke also noted that Eaton Vance led the effort to seek regulatory approval from the US Securities & Exchange Commission (SEC) for NextShares, "because as an active asset manager the company was interested in more efficient ways to deliver investment strategies to investors".

The first NextShares funds began trading on the Nasdaq Stock Market earlier this year. Eaton Vance has been a marginal player in the US structured products market and has nine live open-ended call-overwriting structures in its holdings, according to SRP data.

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