Displaying items by tag: yields

Monday, 25 January 2021 15:23

Munis Still Have a Big Advantage

(Washington)

Munis bonds have done well recently, but the ultra-low rate environment seems to have confused many about their relevance. It is critical to remember that despite yields being so low, munis still very much have a place in the environment. In fact, one could argue the current environment is better for munis than a more conventional one. The reason why is that munis still have a major spread advantage versus taxable equivalents. For example, while munis only yield an average of 0.86% right now, that translates to a taxable yield of 1.53% for those in the top income bracket. However, as we all know, Treasury yields are still much nearer to 1%, meaning munis current enjoy a major advantage over taxable bonds.


FINSUM: Given Biden and the Democrats’ support of state and local municipalities, and munis’ currently yield advantage, there is no reason for the asset class not to have a great year.

Published in Bonds: Munis
Friday, 22 January 2021 14:15

Munis Still Look Attractive

Advisors don’t need to be told that rates are at ultra-low levels. Yet despite this, munis are still maintaining their attractiveness. See the full story here on our partner Magnifi's site.

Published in Bonds: Munis
Thursday, 14 January 2021 13:22

Why the Biden Administration May Be Bad for Gold

(New York)

Gold has been hurting recently, with prices currently around $1,800 after some strong gains over the course of 2020. The big question is where gold is headed now that the vaccine is rolling out and a new administration is coming in. See the full story here on our partner Magnifi's site.

Published in Comm: Precious
Thursday, 14 January 2021 13:14

The SEC Could Make Big Changes to the Muni Market

(Washington)

One of the big risks to the muni sector that has gone underappreciated by the financial media and investing community is the threat of the soon-to-be revamped SEC making some big changes to the asset class. See the full story here on our parnter Magnifi's site.

Published in Bonds: Munis
Monday, 04 January 2021 17:21

Here is Where Munis are Headed in 2021

(New York)

Munis had a wild and rough year in 2020. Everyone who invests in the sector is wondering what’s next. While the lack of direct state and municipal aid in the recent congressional package is a downer for muni investors, there is a lot to be happy about. Election certainty, good news on the vaccine front, and the inauguration of Biden are all raising the sector’s prospects. Biden is seen as more likely to help local state and municipalities with aid, which has raised prospects for the sector. Downgrades are a risk, but widespread defaults seem unlikely.


FINSUM: On the whole, things seem like they are set up for a pretty positive year. As to the possibility of downgrades, it is worth noting that downgrades usually trail economic performance, so they would take a while to come through.

Published in Bonds: Munis
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