Why a Pullback Could Still Prove Inviting for Municipal Bonds
March 9, 2021
Municipal bonds are languishing amid the recent spike in Treasury yields, but that selling pressure could bring opportunities with exchange traded funds like the
MUB seeks to track the investment results of the S&P National AMT-Free Municipal Bond IndexTM. The fund generally will invest at least 90% of its assets in the component securities of the underlying index and may invest up to 10% of its assets in certain futures, options and swap contracts, cash, and cash equivalents. The index measures the performance of the investment-grade segment of the U.S. municipal bond market. Municipal bonds give debt market investors an extra layer of safety given that local government debt typically has a lower rate of default compared to corporate bonds.