Fort Dearborn Income Securities, Inc. (NYSE: FDI) is a closed-end bond fund managed by UBS Global Asset Management (Americas) Inc. The Fund invests principally in investment grade, long-term fixed income debt securities. The primary objective of the Fund is to provide its shareholders with:
- A stable stream of current income consistent with external interest rate conditions; and
- A total return over time that is above what they could receive by investing individually in the investment grade and long-term maturity sectors of the bond market.
OutlookThe complexities that surround the high degree of unconventional monetary stimulus, the ongoing sovereign credit concerns in the European Union, and the sustainability of economic growth and corporate profitability in global economies leave the future direction of interest rates highly uncertain. The transitions that the global and US economies have been undergoing now for more than three years have yet to be fully completed, and economies remain prone to shocks that may be uncharacteristically magnified, given the tenuous state of asset, currency, financial and labor markets. Despite economic growth exhibiting some renewed momentum, we expect that monetary policy will be quite accommodative, as we expect the Fed will be on hold for the foreseeable future until slack in the economy, as evidenced by a stubbornly high unemployment rate and low capacity utilization, exhibits sustainable improvement. We continue to believe that the current economic and interest rate environment, characterized by moderate, noninflationary growth coupled with exceptionally low interest rates, is supportive of sustainable profit growth and for spread product (i.e., non-Treasury debt) more generally. Disclaimers Regarding Fund Commentary - The Fund Commentary is intended to assist shareholders in understanding how the Fund performed during the period noted. Views and opinions were current as of the date of this press release. They are not guarantees of performance or investment results and should not be taken as investment advice. Investment decisions reflect a variety of factors, and the Fund and UBS Global AM reserve the right to change views about individual securities, sectors and markets at any time. As a result, the views expressed should not be relied upon as a forecast of the Fund’s future investment intent. Past performance does not predict future performance. The return and value of an investment will fluctuate so that an investor's shares, when sold, may be worth more or less than their original cost. Any Fund net asset value ("NAV") returns cited in a Fund Commentary assume, for illustration only, that dividends and other distributions, if any, were reinvested at the NAV on the payable dates. Any Fund market price returns cited in a Fund Commentary assume that all dividends and other distributions, if any, were reinvested at prices obtained under the Fund's Dividend Reinvestment Plan. Returns for periods of less than one year have not been annualized. Returns do not reflect the deduction of taxes that a shareholder would pay on Fund dividends and other distributions, if any, or on the sale of Fund shares.
1 The Investment Grade Bond Index is an unmanaged index compiled by the Advisor, constructed as follows: From 12/31/81 to present—5% Barclays Capital US Agency Index (7+ years), 75% Barclays Capital US Credit Index (7+ years), 10% Barclays Capital US MBS Fixed Rate Index (all maturities) and 10% Barclays Capital US Treasury Index (7+ years). Investors should note that indices do not reflect the deduction of fees and expenses.