UBS Global Asset Management announced the recent launch of its new U.S. Equity Alpha Strategy, which seeks to provide investors with more alpha by taking more short positions.

Some investors see alpha as a measure of value added by an investment fund’s manager.

The strategy will generally invest in a broadly diversified portfolio of 75 to 125 securities. It typically seeks to add alpha by taking an average of 30% in short positions balanced by 130% on average in long positions and maintaining overall market exposure generally at 100%. It takes a long-term fundamental approach to identifying shorting opportunities.

The strategy seeks to outperform the Russell 1000 Index by 300 to 500 basis points per year, gross of fees, over a full market cycle with market-like risk.

“Our clients are beginning to loosen their constraints in their pursuit of more alpha-yet they do not want to assume additional risk. We have developed the UBS U.S. Equity Alpha Strategy as a core equity substitute that seeks to generate higher returns, without additional risk,” said Peter Clarke, head of UBS Global Asset Management Canada.

“While the strategy is new, underpinning the strategy are the key elements that have driven our investment approach for over two decades: extensive fundamental research with a global perspective, a globally integrated investment approach and our state-of-the-art Global Equity Risk System that evaluates both long and short positions when constructing a portfolio,” Clarke added.