October 12 House View full set 2026

12 October 2026, 15:27 UTC Chief Investment Office GWM Investment Research

UBS House View Briefcases Christopher Swann, Strategist, UBS Switzerland AG; Vincent Heaney, Strategist, UBS AG London Branch

• Where are the opportunities in fixed income? ................................................................................................ 2 • How can I position for equity upside? ................................................................................................ 3 • Should investors pay more attention to cash? ................................................................................................ 4 • Have European sovereign yields peaked? ................................................................................................ 5 • What does the US-Iran conflict mean for markets? ................................................................................................ 6 • How will Fed rate hikes impact markets? ................................................................................................ 7 • How can I invest in transformational innovation? ................................................................................................ 8 • What role can gold play in portfolios? ................................................................................................ 9 • How to diversify with alternatives? ................................................................................................ 10 • What's next for commodities? ................................................................................................ 11

This report has been prepared by UBS Switzerland AG and UBS AG London Branch. Please see important disclaimers and disclosures that begin on page 13.

Where are the opportunities in fixed income? Key message New this week With global government bond yields at multi-decade highs, we believe Auctions of both the 10-year and 30-year US Treasury notes investors should revisit fixed income exposure to find the right balance last week were stronger than expected, helping to alleviate between yield, potential capital gains, and diversification to match their goals some of the upward pressure on Treasury yields. and constraints. We like quality bonds—including potential opportunities in longer-dated bonds—and diversified fixed income exposure. One liner House view Combining high-quality bonds with selective emerging market exposure can broaden sources of portfolio return.

01 Major central banks have taken a hawkish turn, prompting another step up in global bond yields. Did you know? • The European Central Bank and the Federal Reserve both raised rates by 25 basis points in September. Together with the Bank of England, policymakers indicated • Current elevated outright yields offer a carry cushion greater willingness to tighten before inflation pressures become entrenched. against potential further volatility that was not available in 2022. • Ongoing inflation worries, persistent fiscal concerns, and rising issuance of hyperscaler debt have all kept global government bonds under pressure. • EM sovereign and corporate bond yields stand at around 7.2% and 7%, respectively (JPMorgan EMBI and

02 In quality bonds, there may be opportunities to add interest rate risk selectively. CEMBI indices). These yield levels should underpin high- single-digit returns over the next 12 months, well above • The recent rise in yields has created tactical opportunities to add some duration cash, in our view. in high-quality bonds. Medium- to long-duration high-quality bonds have scope for price gains as we believe current market pricing of central bank tightening is Investment view too aggressive. These bonds can also provide valuable diversification. We view fixed income as Attractive, with opportunities across • We are more cautious on the longest-dated bonds, given fiscal sustainability regions and market segments. Emerging market bonds offer concerns, growing AI-related debt issuance, and the potential for term appealing yields and diversified return potential. In high- premiums to remain elevated. quality bonds, investors can consider adding exposure in the…