When it comes to tax-free municipal bonds, investors who are comfortable with taking more risk are seeing attractive returns.
High-yield municipal bonds – issues that are rated below BBB by Standard & Poor's – have greater default risk than their investment-grade counterparts.
Muni bonds provide tax-free income on a federal basis – and on a state basis if the investor resides in the same state as the issuer.
High-yield muni bond funds have seen estimated net flows of $6.76 billion in 2024 as of June 30, according to Morningstar.
Before you step in Investors looking at high-yield muni bonds, be it individual issues or the funds, ought to consider their risk appetite and their goals.
Persons:
Morningstar, Beth Foos, munis, you've, Matthew Norton, Norton, Mathew Kiselak, that's, Kiselak, Morningstar's
Organizations:
Standard, Bank of America . Investment, muni, Morningstar, SEC
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