UBS Global Asset Management Launches New UBS U.S. Equity Alpha Fund for Retail Investors.

CHICAGO -- UBS Global Asset Management announced today that it has launched the UBS U.S. Equity Alpha Fund, a core equity holding that seeks to generate alpha -- or the excess return over the benchmark -- by investing in both long and short positions.

UBS Global Asset Management launched a similar strategy in the institutional market in September 2005; as of June 30, 2006, the group managed $411 million in assets in that strategy.

The UBS U.S. Equity Alpha Fund seeks to outperform the Russell 1000 Index by 250-500 basis points per year (gross of fees) over a full market cycle, with a similar level of market risk as the index. UBS Global Asset Management does not represent or guarantee that the fund will meet this return goal.*

The UBS U.S. Equity Alpha Fund attempts to generate alpha in three ways:

* Taking long positions in securities deemed underpriced.

* Taking short positions in securities deemed overpriced.

* Making pair trades. A pair trade takes a long position in a somewhat undervalued security and a short position in a somewhat overvalued security that are correlated.

"The UBS U.S. Equity Alpha Fund is not a hedge fund, but a core equity strategy that fully employs UBS Global Asset Management's 25-year, fundamental, price-to-intrinsic-value philosophy," said John Leonard, Head of North American Equities at UBS Global Asset Management (Americas) and leader of the Fund's investment management team.

"Although we have not traditionally employed short selling in our strategies, our investment process has proven successful at identifying both over- and underpriced securities. In long-only portfolios, we can capitalize only on a portion of our research convictions: the underpriced securities. By relaxing the long-only constraint, UBS U.S. Equity Alpha Fund has the flexibility to capitalize on all the mispriced securities our research identifies," Leonard added. "This added capability offers retail investors the potential for returns that are higher than those offered by traditional long-only funds and the benchmark. Markets go in cycles, with growth outperforming value for a time and then value outpacing growth. UBS U.S. Equity Alpha Fund seeks to add value throughout a full market cycle, regardless of which style is in favor."

UBS is one of the world's leading financial firms, serving a discerning global client base. As an organization, it combines financial strength with an international culture that embraces change. As an integrated firm, UBS creates added value for clients by drawing on the combined resources and expertise of all of its businesses.

UBS is the world's largest wealth manager, a top-tier investment banking and securities firm, and one of the largest global asset managers. In Switzerland, UBS is the market leader in retail and commercial banking.

UBS is present in all major financial centers worldwide. It has offices in 50 countries, with about 39% of its employees working in the Americas, 37% in Switzerland, 16% in the rest of Europe and 8% in Asia Pacific. UBS's financial businesses employ around 72,000 people around the world. Its shares are listed on the SWX Swiss Stock Exchange, the New York Stock Exchange (NYSE) and the Tokyo Stock Exchange (TSE).

* Risk is measured by standard deviation. A market cycle is typically four to seven years.

For more information

Contact your Financial Advisor, or UBS Global Asset Management at 888-793 8637 for a current Fund prospectus, or visit us on the Web at www.ubs.com/globalam-us. Investors should carefully read the Fund's prospectus and carefully consider the Fund's investment objectives, risks, all charges, expenses and other matters of interest before investing. It's important you have all the information you need to make a sound investment decision.

Disclaimer

There are certain risks that may impede the achievement of the Fund's goal, which include, but are not limited to, derivative risk, leverage risk and short selling risk. It is possible that the Fund's securities held long will decline in value at the same time that the value of the securities sold short increases, thereby increasing the potential for loss. The Fund expects to have 100% exposure to the US equity markets, so when the markets experience negative returns, the Fund may experience negative returns.