UBS AG added three employees to its global event-driven opportunities group for market-making in special situations.
Nick Gustafson is joining as a senior trader in New York in September from Macquarie Group Ltd., after UBS hired Musaab Javed in London last month from investment bank Houlihan Lokey, according to spokeswoman Megan Stinson. Also in London, Switzerland’s biggest lender added Monica Ugidos in May from Citigroup Inc. They’ll report to Tom Einhorn, head of the trading group created last August.
The team trades corporate and sovereign bonds, loans and credit-default swaps around events that may include corporate takeovers, divestitures and management changes. Hedge funds focused on events and special situations returned 5.6 percent in the first half of this year, according to data compiled by Bloomberg.
The default rate for U.S. companies rated junk rose to 1.9 percent in the second quarter from 1.8 percent in the year’s first three months, according to Moody’s Investors Service. Dollar-denominated distressed bonds, which typically yield more than 10 percent, have returned about 7.4 percent this year, following last year’s 12 percent return, according to Bank of America Merrill Lynch index data.
High-risk, high-yield bonds are rated below Baa3 by Moody’s and lower than BBB- by Standard & Poor’s.
Ugidos worked at Citigroup before joining UBS, most recently in sales of leveraged debt, according to her LinkedIn profile. Gustafson previously worked at a unit of JPMorgan Chase & Co. from 2006 through 2011, and graduated from the University of Virginia, according to his LinkedIn profile.