UBS On-Air: Market Moves CIO Fixed Income Roundtable Series: Performance update & outlook
Sep 25, 2025
Leslie Falconio, the head of Taxable Fixed Income Strategy for the Americas at UBS, leads a discussion on Fed cuts and their impact on market conditions. Frank Sileo dives into the performance of preferred securities, highlighting the recent divergence between retail and institutional preferreds. Barry McAlinden shares insights on the stability of investment-grade corporates, pointing to strong earnings as the rationale behind tight spreads. Together, they explore the outlook and strategies for navigating the evolving fixed income landscape.
AI Snips
Chapters
Transcript
Episode notes
Fed Cuts Likely But Data Dependent
- CIO expects more Fed cuts but remains data dependent and non-recessionary in tone.
- Fixed income recovery has been driven mainly by carry rather than spread compression or rate moves.
Retail Vs Institutional Preferreds
- $25 retail preferreds rallied strongly over the summer while $1,000 institutional preferreds delivered steady returns.
- Diversifying across both retail and institutional preferreds improves risk-adjusted exposure.
Diversify Within Preferreds
- Maintain exposure to both $25 and $1,000 par preferreds to diversify correlations with equities.
- Expect choppy returns and consider the possibility of a pullback into year-end, so size positions accordingly.