UBS Equities-Asia Style Guide _Low Risk led as most factors fell_ Stephen...-119117407

ab1 December 2025Global ResearchAsia Style GuideLow Risk led as most factors fellMost factors declined except Low RiskAsia ex-Japan fell 2.9% in November, with most style factors posting losses. Low Risk stood out with both definitions delivering strong gains: Low Volatility rose 8%, and Low Price Beta gained 6.3% on a long-short basis. A few Value factors also made gains, notably Dividend Yield (+5.7%) and Free Cash Flow Yield (+3.1%), though other Value factors saw minor declines. Delta Quality also recorded a modest gain of 1.1%. All remaining factors experienced drawdowns, with the steepest losses across all three Momentum definitions: 12-month Momentum (-4.1%), Earnings Revisions (-3.1%), and Momentum Composite (-3%).Impact of US Yield 2Y rose while US 10Y-2Y Spread impact declineThe contribution of macro factors to market volatility edged up from 14% to 15% in November, driven primarily by a rise in the impact of US 2Y Yields, which climbed from 5% to 8%. In contrast, the influence of the US 10Y-2Y Spread slipped slightly, falling from 9% to 7% of total market variance. All other macro factors remained largely insignificant. Cross-sectional dispersion decreased across Asia ex-Japan, CN+HK, and Korea, while it increased in all other markets. Pairwise correlation declined broadly, except in Korea where it increased.Valuations declined in most markets, sectors and stylesAsia ex-Japan valuations fell again in November, with the 12-month forward P/E dropping from 14.8x to 14.2x, now valued near the upper quartile of the historical range. Most markets also saw declines, except India, where valuations edged higher. Across sectors, valuations broadly decreased, with exceptions in Consumer Staples, Energy, Health Care, and Real Estate, where they increased. Notably, Health Care saw a significant increase, approaching historical highs. From a style perspective, most factors recorded notable valuation declines, except Low Volatility and Dividend Yield, which ticked up slightly.Figure 1: Style factor performance in November 2025Source: FactSet, UBS Quantitative DatabaseThis report has been prepared by UBS Securities Asia Limited. ANALYST CERTIFICATION AND REQUIRED DISCLOSURES, including information on the Quantitative Research Review published by UBS, begin on page 11. UBS does and seeks to do business with companies covered in its research reports. As a result, investors should be aware that the firm may have a conflict of interest that could affect the objectivity of this report. Investors should consider this report as only a single factor in making their investment decision.EquitiesAsiaQuantitativeWill StephensAnalystwill.stephens@ubs.com+852-3712 3892Jia Li Mok, CFAAnalystjia-li.mok@ubs.com+65-6495 5772Paul WinterAnalystpaul-j.winter@ubs.com+61-2-9324 2080Cathy Fang, PhDAnalystS1460518100001cathy.fang@ubs.com+86-21-3866 8891Aaron Guo, CFAAnalystaaron.guo@ubs.com+852-2971 7705Anita Mansbridge, FIAAAnalystanita.mansbridge@ubs.com+852-2971 7302Jes