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Time for Muni's

I'm thinking about jumping back into National Muni's, considering several OEF's, such as GSMIX (GS Muni income fund), MEMTX (Black Rock), BNMSX (Baird Core Inter.), among other (Nat. Intermediate) funds.

Not really interested in HY and don't want to have multiple Muni funds. Hoping to park some cash into a Nat. Inter. Muni to get a decent yield and total return!

Right now I have a bunch of cash sitting in FZDXX (Fido MM) with 7-day yield of 2.39% (taxable).

It is a long-term investment, so i don't believe i would be late-to-the-party, correct???

Any thoughts on these funds or others?

Any other suggestions?

Thanks for any and all thoughts, recommendations and ideas!



  • edited February 2019
    @Matt What's your State? TRP is not a great bond shop. But in poring over their bond offerings, there are a number of State-specific funds. GA, MD, CA, NJ among them. Just recalling, off the top of my head. Also look at PTRMX, a Performance Trust muni fund out of Chicago. Juicy dividends. Risk/Reward profile is not ideal, though.
  • I'm not seeing any evidence why Munis would return any more than the MM you are in. They have been a go-no-where investment for over 2 years now. Curious what you see that is going to change that? No, I don't think you can be late to the party. Quite a bit early maybe.
  • edited February 2019
    I'm with @MikeM; intermediate munis are so low-yielding, I wouldn't be interested. If you were playing yield plus capital gain, maybe, but the latter's not something I'd count on from where we are now.

    If you don't want to jump up to long-duration IG munis for the better yield, you might look into relatively higher quality, short-term high yield muni funds. HY in muni-land isn't as risky as comparably rated HY corps.
  • edited February 2019
    AndyJ said:

    HY in muni-land isn't as risky as comparably rated HY corps.

    That’s my impression as well - but little experience with munis. Had some non-sheltered $$ to tuck away for about a year a while back and used Price’s PRFHX. If memory serves, I cut it 50/50 between that fund and their investment grade intermediate muni just to be safe. Worked reasonably well at the time. However, the fund isn’t rated very high by M* and the others. Knowing how risk averse T Rowe tends to be that doesn’t surprise me.
  • edited February 2019
    You may need to buy individual munis bbb-rated or higher-ups... May have better yields than Mm or mf
    Best buy from they have much better qualities munis and most st if them not junk rated
  • Thanks everyone!!

    Crash, I live in Florida, no state tax, of course.

    MikeM and others, FZDXX has a nice yield but no Cap. Apprec. My thoughts were as AndyJ stated "not something I'd count on from where we are now".

    I'm just not crazy about HY but maybe that's the only place to get yield and CA or maybe as johnN suggested individual muni's, which I have not looked into yet.

    Any further thoughts are appreciated!!!
  • Have you considered CEF's for muni exposure or have you no desire to go there?
    NZF as an example would double your current MM fund for income.
  • edited February 2019
    How about muni ETFs as well as unleveraged closed end funds, trading at a discount?


    CEFs (example below, also NXQ...)
  • Mark, Vegomatic I have thought about those options but I have very little knowledge about them. I know I need to educate myself. Do you have suggestions so I can make an informed choice? Thx Matt
  • MikeM said:

    I'm not seeing any evidence why Munis would return any more than the MM you are in. They have been a go-no-where investment for over 2 years now. Curious what you see that is going to change that? No, I don't think you can be late to the party. Quite a bit early maybe.

    The numbers show a different story
    year to date MUB is up 0.6% while a good MM FZDXX is only at 0.2%...for 3 months MUB is up 3.1% while FZDXX 0.6%
    Matt is diffidently late because the next 3 month will not be at 3.1% for MUB. I continue to own Munis as long as they have their momentum.

  • My choice for HY munis is ORNAX. 5 stars since forever at M*.
  • @FD1000, you make a good point looking at the last 3 month spurt. In that case I agree the time to buy was 3 months ago (sounds like a Geico commercial:) ). I was looking at it as what to expect from a long term, next 3-5 years, investment in Munis (or maybe bonds in general) and in that way I wouldn't be comfortable that 1 year or 3 year Muni returns will out-perform CD's or even a money market like they did in past years. But who knows. And maybe that changes if in a taxable account versus tax deferred.

    I agree with the point you made though.
  • @mcmarcasco - If you're asking about which 'particular one' to buy then that will depend on your own personal financial situation. I know, a copout, but I hesitate to go there.

    If you're looking for schooling on CEF's there are plenty of 101 course sites:

    to start with or just Google "how to invest in CEF's"

    I highly recommend the M* 'Closed-End Funds' discussion board FWIW
  • First, thanks everyone for your input, suggestions and recommendations!!!

    Second, In opposition to my original post, I decided to invest in a HY muni OEF (GHYAX; Goldman Sachs).

    I am now looking to partner GHYAX with another muni fund with shorter "duration" and a tad lower on the "risk" scale.

    The OEF's I came across originally (GSMIX (GS Muni income fund), MEMTX (Black Rock), BNMSX (Baird Core Inter.), Eaton Vance and a couple of other Nat. Intermediate funds) still seem to be legit options, along with the suggested CEF's.

    But the metrics of these funds appear inferior to short-duration HY muni's such as ISHAX (Invesco).

    What am I missing? Am I miss-interpreting the numbers?

    Any thoughts, ideas, suggestions and recommendations are greatly welcome!

    Thx, Matt
  • edited April 2019

    For me, ISHAX might be a named as a short duration high yield muni fund; but, from my perspective, it is anything but a short duration fund as it carries an average duration of 4.64 years with an average effective maturity being listed, by M*, at 9.37 years. To me, this is not a short duration high yield muni fund. I'm thinking short duration would be within a 1 to 3 year range with an average effective maturity likewise falling within that range as well.
  • edited April 2019
    Munis are issued with long maturities, so < 5 is generally considered short duration in the asset class. Lower credit (but nowhere near the risk of similarly rated corporates, as munis are) with some rate sensitivity isn't a bad setup for an unofficial barbell approach.

    P.S. Matt, I use NVHAX quite a bit. I don't invest in IG munis much at all these days; absent leverage, their yields have been pretty paltry for years.

    I do use muni CEFs (Pimco, Invesco, and Nuveen have some pretty decent ones), but not when they're at high valuations like they are now. Pimco's are generally at high premia now, and they just announced some distribution cuts early this week. I'll own a muni CEF or two when the next selloff comes along. You might look into that route, but it does take some time to get your personal investment schtick down with CEFs.

    Good luck -- AJ
  • msf
    edited April 2019
    Lipper categories:

    SMD - Short Municipal Debt Funds - Funds invest in municipal debt issues with dollar-weighted average maturities of less than three years.

    SIM - Short-Intmdt Municipal Debt Funds - Funds invest in municipal debt issues with dollar-weighted average maturities of one to five years.

    ISHAX has an average effective weighted maturity of 9.37 years. (Effective maturity is generally shorter than stated maturity because it incorporates the likelihood of being called.) That makes it clearly not short term by Lipper definitions. Likewise, M* shows the fund as intermediate term.
  • edited April 2019
    Thanks for the info on the Lipper category, msf. I was thinking of M*, which uses a cutoff of a duration of 4.5y (not 5y as I thought I remembered) between short and intermediate, shown in their category classification document, and like you said, that makes ISHAX M* intermediate. NVHAX comes in (right now, at least) just inside short duration territory by the M* measure.
  • I have played this space for a very long time and it's a core part of my portfolio. Here you go.... for an anchor I use VWALX. Buy XMPT on the dips. DMB for a solid CEF. And, NHMAX for the best all around OEF, but with commensurate risk.
  • edited April 2019
    Thanks everyone for your thoughts and suggestions!!!

    wxman123, if understand you correctly, you are using VWALX as your "core" muni holding and supplementing it with other muni's?

    I currently own GHYAX, Goldman Sachs HY muni; how (un)wise would it be to pair GHYAX with another HY muni? What if the the HY muni was of short duration such as NVHAX.

    Any further input would be greatly appreciated!

  • Has Perf Trust (Chicago) PTRMX been mentioned yet in this thread? I watch it as a matter of habit. But I wonder whether Munis in general are for me. If wifey and I move, I believe our tax bracket will go UP, so it may be worth an investment in Munis when that day comes.
  • What are the differences between NHMAX and

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