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Published on 11/29/2011 in the Prospect News Fund Daily and Prospect News Structured Products Daily.

New Issue: UBS prices $10 million ETracs Fisher-Gartman Risk Off ETNs due 2041

By Marisa Wong

Madison, Wis., Nov. 29 - UBS AG, London Branch priced $10 million of 0% exchange-traded access securities Fisher-Gartman Risk Off exchange-traded notes due Nov. 27, 2041 linked to the Fisher-Gartman Risk index, according to a 424B2 filing with the Securities and Exchange Commission.

The company plans to sell up to $100 million of the Risk Off ETNs. The initial $10 million of notes priced at par of $25. The remaining $90 million will be sold from time to time at varying prices.

The Fisher-Gartman index consists of a mix of long and short positions in various asset classes, the overall value of which is expected to rise when the outlook on markets and the economy is positive and fall when the outlook is negative. Specifically, the index takes long positions in risk asset classes like commodities, equities and certain currencies and short positions in non-risk asset classes such as government bonds and certain "safe haven" currencies. The weightings for the long and short positions are 150% and 50%, respectively, and the index is rebalanced quarterly.

The Risk Off ETNs provide short (inverse) exposure to the daily performance of the index.

The current principal amount of each Risk Off ETN at pricing was $25. For each subsequent day, the current principal amount will equal (a) the current principal amount on the immediately preceding calendar day times (b) the daily index factor minus (c) the tracking fee.

On any day, the daily index factor for the Risk Off notes is equal to (a) one plus (b) (i) one minus (ii) the index closing level on that day divided by the index closing level on the previous day.

The tracking fee is initially zero. On each day following the pricing date, the fee will equal 1.15% divided by 365 times the current principal amount on the preceding day.

The payout at maturity will be the current principal amount of the securities on Nov. 22, 2041.

The Risk Off notes are putable subject to a minimum of 50,000 notes and a redemption fee of 0.125% of the current principal amount. They are callable in whole beginning Dec. 3, 2012. The company will automatically redeem the notes if their indicative value falls to $5 or less or decreases in value by at least 60% as compared to the previous business day.

The notes were approved for listing on NYSE Arca under the symbol "OFF."

UBS Investment Bank is the agent.

Issuer:UBS AG, London Branch
Issue:Exchange-traded access securities Fisher-Gartman Risk Off exchange-traded notes
Underlying index:Fisher-Gartman Risk index
Amount:$10 million
Maturity:Nov. 27, 2041
Coupon:0%
Face amount:$25
Payout at maturity:Current principal amount of ETNs on Nov. 22, 2041
Current principal amount:Current principal amount on previous day times daily index factor minus tracking fee
Daily index factor:(a) one plus (b) (i) one minus (ii) index closing level on current day divided by index closing level on previous day
Tracking fee:1.15% divided by 365 times current principal amount on preceding day
Put option:At any time subject to minimum of 50,000 notes and 0.125% redemption fee
Call option:From Dec. 3, 2012 onward
Acceleration:Notes will be automatically redeemed if their indicative value falls to $5 or less or decreases in value at least 60% as compared to the previous business day
Pricing date:Nov. 29
Settlement date:Dec. 2
Agent:UBS Investment Bank
Listing:NYSE Arca: OFF
Cusip:90268A691

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