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| 5/10/2013Market Performance |
| Municipal Bonds |
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S&P National Bond Index
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3.00% |
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S&P California Bond Index
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2.96% |
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S&P New York Bond Index
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3.13% |
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S&P National 0-5 Year Municipal Bond Index
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0.70% |
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| S&P/BGCantor US Treasury Bond |
400.09 |
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| More |
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| Income Equities: |
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| Preferred Stocks |
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S&P U.S. Preferred Stock Index
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848.03 |
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S&P U.S. Preferred Stock Index (CAD)
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636.26 |
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S&P U.S. Preferred Stock Index (TR)
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1,701.05 |
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S&P U.S. Preferred Stock Index (TR) (CAD)
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1,276.26 |
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| REITs |
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S&P REIT Index
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174.07 |
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S&P REIT Index (TR)
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425.30 |
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| MLPs |
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S&P MLP Index
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2,469.58 |
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S&P MLP Index (TR)
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5,428.50 |
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See Data
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Closed End Municipal Bond Funds: Unloved Asset Class Offering Interesting Opportunities |
Seeking Alpha - April 20, 2011 - by Surly Trader
At a point in time when a 10 year Treasury earns 3.37%, a 30 year Treasury earns 4.44%, and an investment grade corporate bond portfolio with average maturity of 12 years (LQD) has an indicated yield of 4.7% you just have to wonder where any sort of income is available. My first conclusion is that I would rather hold an equity REIT ETF (IYR) at 3.38% than hold a 10 year Treasury at 3.37%. My second conclusion is that both yields leave quite a bit to be desired.
My next thought is to look at the current unloved asset class in the investment world – Municipal Bonds. The Market Vectors Long Municipal (MLN) earns a whopping 5.34% (average maturity 24.22 years!), the iShares S&P AMT-Free Muni (MUB) earns a healthy 3.63% (average maturity 10.46 years). These funds are interesting because they are federal tax free. Assuming a 25% federal tax bracket ($69-139,500 married filed jointly) that works out to a 7.12% (.0534/.75) and 4.8% tax-equivalent yield respectively. Obviously if you pay more in federal taxes these yields are even higher.
The follow up is to look at the unloved of unloved – closed end muni funds. The beauty of closed end funds is that when people do not like the asset class, the closed end funds can trade at a discount to the NAV – meaning that you can buy the funds for less than you can buy what the fund actually owns. I will not speculate on the value of the funds below, but allow you to peruse the closed end muni funds that trade at discounts to their net asset values. Click for more.
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| Stuff to look at |
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S&P Commentary and Newsletters: S&P
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| BondsOnline Advisor |
Income Security Recommendation January 2013 Issue.
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