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.
Although several U.S. municipalities have declared bankruptcy, muni bonds overall remain extraordinarily safe in terms of default risk, says Morningstar's Jeff Westergaard.
Despite the scare of recent bankruptcies and downgrades, municipalities have the resources to continue making bond payments, while looming tax increases likely won't affect muni demand, says Morningstar's Jeff Westergaard.
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.
Despite risks in the muni-bond market, defaults are isolated, and the diversification in muni CEF portfolios helps protect against credit problems.
The muni market has seen a strong recovery since 2009, though these tax-advantaged products are much safer in some regions than others, says Morningstar's Jeff Westergaard.
Although some opportunities are available today, muni investors should be sure they are getting compensated for the risks they are undertaking, says Fidelity's Mark Sommer.
Morningstar's Miriam Sjoblom discusses how to gauge whether a muni fund is more apt than a taxable-bond fund, yield risks and other key focus points, and some of her muni-fund recommendations.
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