Compliment to HY muni

mcmarasco

I'm looking to add an I/T muni fund to compliment my HY muni, OPTAX (only bond fund owned in my taxable acct). I have a fair amount of cash (in pct terms) that obviously is doing nothing. I'm at my target stock-to-bond/cash allocation, but not sure it's wise to hold onto CASH or increase my stock percentage, so the next best thing, i presume, is to put some CASH to work, somewhere. I've look into "alternative" investments, but not sure the added risk and uncertainty is what i am looking for.

I prefer a below 1 beta and low/below avg risk profile.

I've narrowed it down to: BBIIX (BBH); BMNIX (Baird); WITAX (Segall Bryant & Hamill)

They all have solid metrics, including sub-four SD. WITAX appears to have slightly lower credit quality but also has slightly out-performed the other two, but for the most part, most metrics a very similar.


Any thoughts, suggestions or opinions on these or other investments that i should consider and investigate, would be greatly appreciated!!!


Thx,

Matt

AndyJ

Hey Matt,

One thought (just saw your post) about Baird muni fund options. There's a new one, been out only a shade over a year, BSNIX, that has done well so far, especially for being shorter duration and about 90% investment grade. It's ahead of both OPTAX and BMNIX ytd - big factor being losing a lot less in the March meltdown - and apparently a smoother ride.

I haven't dived into it any deeper than that. Might be worth a close look.

AJ

mcmarasco

Thank you AJ!

I have been doing a little due diligence into that fund and so far it looks very good.

It’s objective appears to be similar to that of its sister fund BMNSX/BSNIX but as you noted it has a shorter duration with less volatility. I like that.

Any other thoughts or suggestions?

Matt

stillers

Had the same situation last week. Hold OPTAX and GHYAX and was looking to add a NI. Narrowed it to BBIIX/BBINX and BMNIX. Chose BBINX as an ever so slightly better choice over the Baird offering.

All of the funds listed to date on this thread would be in my final group and don't think you can go too far wrong with any of them. FWIW, I'm a little biased towards funds that have been around longer than WITAX or BSNIX but both look very good if that's not an issue with you.

wxman123

If you're looking to counterbalance a HY muni I'd consider VMPAX. It won't get you the same bang as the funds mentioned above (but that's what the HY is for). I like that VMPAX has had only one down year in the past 20, and only a loss of -0.39% at that. This is pretty close to a tax free cash substitute.

stillers

The funds being suggested by the OP and other posters as complimentary to HYM fund OPTAX are MNI funds. VMPAX is a MNS fund. While VMPAX will be complimentary to OPTAX, but it will not provide the TR or the yield of the suggested MNI funds.