JPMorgan likes munis vs. corporates


Municipals (MUB) aren't just trading cheap relative to Treasurys (TLT), but also to corporates (LQD), argues JPMorgan.

The observation isn't a huge surprise, but the team notes continued light supply of municipals as a supporting factor - there's been an average of $5.6B per week in issuance since rates turned higher in May vs. and average of $7.2B per week from January to April. It turns out the refinance market for local governments has slowed along side that of homeowners.

JPMorgan doesn't expect a "sustained uptick" through the end of the year, but what about this fall's big drop in rates?

Muni ETFs: MUB, SUB, MUNI, PVI, PZA, SHM, TFI, VRD, HYD, ITM, MLN, PRB, SMB, GMMB, SMMU, RVNU, NY.

IG Corporate ETFs: LQD, CBND, CORP, FLTR, FLRN, ITR, LWC, SCPB, VCIT, VCLT, VCSH, IGU, IGS, CSJ, QLTA, QLTB, BSCI, BSCJ, BSCK, BSCL, BSCM.

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