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investing.com article about Muni funds
Old 11-11-2019, 10:03 AM   #1
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investing.com article about Muni funds

I will admit I don't know a great deal about Municipal bond funds. Obviously this article has a certain view point but I'm curious if anyone actively uses them and are they simply a part of your strategy or do you lean on them heavily for the tax advantages? The first comment on this article is a contrarian viewpoint at least to how they were calculating the counter scenario profitability of owning Vanguard S&P 500 (NYSE:VOO). The person leaving the comment had some valid points regarding how you could go about managing taxes in the aforementioned S&P 500 fund. Also if anyone has a resource that they like on the topic I'm always interested in expanding my knowledge. Thanks

https://www.investing.com/analysis/5...-how-200484172
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Old 11-11-2019, 10:26 AM   #2
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The article promotes a closed end muni fund (NMZ) that uses leverage, but doesnít mention either as a risk factor. This type of investment is not a good option for anyone not understanding the risk of leverage or a CEF.
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Old 11-11-2019, 11:21 AM   #3
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From the article:

Quote:
Disclosure: Brett Owens and Michael Foster are contrarian income investors who look for undervalued stocks/funds across the U.S. markets. Click here to learn how to profit from their strategies in the latest report, "7 Great Dividend Growth Stocks for a Secure Retirement."
So, caveat emptor I guess.........
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Old 11-11-2019, 11:52 AM   #4
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I own Nuveen Muni Value (NUV)and have for years. It has been very solid. I added to it in the past year. It is a CEF, but no leverage.

It is not a "cornerstone", just an ingredient. Has done well over time with far less volatility than expected.

I like that it is a fund and a CEF is great for bonds, since they are not hit with massive redemptions which exacerbate market inflection. And diversified and active management, which I think you want for bonds.
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Old 11-11-2019, 12:54 PM   #5
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Muni's yes. Funds, no.
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Old 11-11-2019, 09:33 PM   #6
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CEFs yes.
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Old 11-11-2019, 10:56 PM   #7
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I have single state muni fund in a brokerage account for my high SALT location. Iím buying into into it every month. Pays about 2.5% and I benchmark it to a MMF.
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Old 11-12-2019, 04:49 AM   #8
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I have liked individual munis in the past, but for a while I have found that taxable bonds have a better after tax yield.
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Old 11-12-2019, 08:55 AM   #9
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Originally Posted by DrRoy View Post
I have liked individual munis in the past, but for a while I have found that taxable bonds have a better after tax yield.


I agree. I have a single individual muni and would love to buy more but nothing remotely attractive compared to the intermediate term fund I have. It takes a lot of cash to be diversified with individual bonds.
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Old 11-12-2019, 09:11 AM   #10
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I have roughly 70 individual muni bonds across different states, maturities and credit quality. I bought many of them 4-6 years ago and together they have a weighted tax free yield of 4.02%. I do my own research and buy them through the Schwab platform. I always hold until maturity or until call. Obviously, the problem I have been having is that upon maturity or call I cannot replace the bonds with anything remotely approaching the above yield.
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Old 11-12-2019, 09:19 AM   #11
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I agree. I have a single individual muni and would love to buy more but nothing remotely attractive compared to the intermediate term fund I have. It takes a lot of cash to be diversified with individual bonds.
I have been trying to stay true to my ladder. I bought a number of issues when rates were higher and I am glad I did. My yield is 4.53% and much of that is double tax free.
I had about 120 individual issues and between maturing bonds and calls, that is down to about 80 now.
I still find a needle in the haystack occasionally with individual issues.
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Old 11-12-2019, 04:46 PM   #12
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70 issues....120 issues. I canít fathom having so many but it must feel awesome getting those yields. Is that current yield or yield on cost?
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Old 11-12-2019, 05:02 PM   #13
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Originally Posted by COcheesehead View Post
Muni's yes. Funds, no.
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Old 11-12-2019, 06:39 PM   #14
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Originally Posted by jazz4cash View Post
70 issues....120 issues. I canít fathom having so many but it must feel awesome getting those yields. Is that current yield or yield on cost?
Fido has some excellent bond management tools. I more or less manage off of alerts only. So though it sounds like a lot, itís reading just a few emails a week.
The yield is calculated by Fido and they call it average estimated yield. I need to look at their methodology.
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