UBS On-Air: Market Moves
Fixed Income Conversation Corner with Robert Cohen (DoubleLine) and Leslie Falconio (UBS CIO)
Sep 22, 2023
Leslie Falconio (UBS CIO) and Robert Cohen (DoubleLine) discuss the current landscape for fixed income investors, opportunities in the asset class, yield curve inversion, and the current state of credit markets. They also highlight the benefits in the corporate credit curve and staying short and up in quality.
25:22
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Quick takeaways
- Fixed income investments now offer better yields compared to a few years ago, creating a favorable opportunity for investors.
- The Federal Reserve is likely to maintain a cautious approach, prioritizing economic stability amidst uncertainty and potential inflation.
Deep dives
Opportunities in Fixed Income
Fixed income investments now offer better yields compared to a few years ago, with opportunities to generate income across all fixed income sectors. For example, triple B investment grade credit now yields 6%, equivalent to what high yield triple C credit used to yield. This improved entry point into fixed income creates a favorable opportunity for investors. Additionally, there is a trend of borrowers in the fixed income market moving towards deleveraging, resulting in lower issuance and a focus on defending balance sheets. This combination of higher yields and potential for lower issuance makes fixed income an attractive option.
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