Financial Planning News
Wed, 29 May 2013
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Munis have faced both interest rate and credit risk pressures, but at current levels, this varied asset class is worth considering, especially for those in higher tax brackets, say Morningstar's Candice Lee and Eric Jacobson.
Despite risks in the muni - bond market, defaults are isolated, and the diversification in muni CEF portfolios helps protect against credit problems.
As the Fed intends to keep interest rates low for the next few years, muni -CEF investors should maintain a close watch on their funds' call exposure.
The muni market still faces challenges, but with careful research and disciplined risk control, muni investors have plenty of opportunity, says Fidelity's Mark Sommer.
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