Fri, May. 1, 3:28 PM| Comment!
Fri, Apr. 17, 1:54 AM
- In a change of heart, the Federal Reserve will allow big U.S. banks to use some types of municipal bonds to meet new rules that ensure they have enough cash during a market meltdown, WSJ reports.
- At issue is the treatment of municipal debt under new liquidity requirements, which call for large banks to hold enough "high-quality liquid assets" to fund their operations for 30 days.
- Other regulators, including the OCC and FDIC, do not plan to follow the Fed's new criteria.
- ETFs: MUB, HYD, BAB, PZA, MUNI, HYMB, TFI, XMPT, ITM, MLN, BABS, SHM, CMF, SHYD, PRB, NYF, PZT, SUB, SMB, PWZ, CXA, IBMF, PVI, RVNU, INY, SMMU, IBMG, IBME, IBMD, GMMB, FMB, IBMI, IBMH, MEAR
Wed, Apr. 1, 2:02 PM| Comment!
Thu, Mar. 5, 2:30 PM
- The iShares Short Maturity Municipal Bond ETF (BATS:MEAR), which began trading on BATS Exchange this morning, seeks to maximize tax-free current income.
- According to MEAR's product brief, "the fund invests in tax-exempt municipal bonds with maturities of less than five years and under normal circumstances the portfolio will have an effective duration of 1.2 years or less."
- Of the nearly 300 iShares funds available, this is the firm's 7th active ETF.
- Other short duration muni bond ETFs: SHM, SUB, SMB, SMMU
Mon, Mar. 2, 3:31 PM| Comment!
Mon, Feb. 2, 3:08 PM| Comment!
Dec. 29, 2014, 4:40 PM| Comment!
Oct. 17, 2014, 4:10 AM
- Detroit has taken a major step towards exiting bankruptcy protection after agreeing to a deal with with its largest holdout creditor, Financial Guaranty Insurance Company, which is owed $1B.
- Under the settlement, Financial Guaranty will have the rights to develop a hotel, retail and condominium complex on the site of the Joe Louis Arena, the soon-to-be-vacant home the Detroit Red Wings hockey team.
- The dispute between Detroit and Financial Guaranty had threatened other important deals that the city had forged with thousands of creditors.
- ETFS: MUB, HYD, BAB, PZA, MUNI, TFI, ITM, HYMB, MLN, CMF, SHM, BABS, XMPT, PRB, SUB, PZT, SMB, NYF, SHYD, CXA, PWZ, PVI, SMMU, INY, VRD, GMMB, RVNU
Jul. 11, 2014, 1:59 AM
- U.S. municipal bond funds had some of the biggest outflows since January, after investors pulled out $790M in the week ended July 9. $691M of the outflows was in the high-yield sector, being withdrawn due to default concerns of Puerto Rican debt.
- Adding to the worries is Puerto Rico's newest law which allows for public corporations to restructure their debt. The new law pushed ratings agencies last week to downgrade the commonwealth's bonds even lower within junk territory.
- Barclays High Yield Municipal Bond Index, up more than 9.5% in mid-June, was up less than 5.5% this past Wednesday.
- ETFs: MUB, HYD, BAB, PZA, MUNI, TFI, HYMB, ITM, MLN, SHM, CMF, XMPT, BABZ, BABS, PRB, SHYD, SMB, NYF, PZT, SUB, PWZ, CXA, PVI, SMMU, INY, MUAF, VRD, MUAD, MUAE, GMMB, MUAC, MUAG, RVNU, MUAH, FMB
Jun. 24, 2014, 3:14 PM
- Acknowledging recent heavier municipal issuance of late has been met by solid demand, Citi nevertheless sees "significant reasons for concern," notably anemic muni bond fund flows. With issuance continuing on the heavy side, the team wonders about the capacity of the market to hold unless fund flows rebound. Toss in possibly rising Treasury yields and the effect could be magnified.
- "We are not, however, suggesting that a very sharp selloff is likely," says Citi noting a huge amount of cash on the sidelines waiting to buy on any significant rebound in yields.
- ETFs: MUB, PZA, MUNI, TFI, ITM, MLN, SHM, XMPT, PRB, SMB, SUB, PVI, SMMU, MUAF, VRD, MUAE, GMMB, MUAD, MUAC, MUAG, MUAH, RVNU, FMB
Jun. 3, 2014, 3:33 PM
- Issuers have scheduled $11.7B of long-term sales over the next month - the busiest pace in three months - and it's a good thing as investors are about to get the most cash ($104B) in two years from June through August from debt payments, according to JPMorgan's Peter DeGroot.
- The funds received will exceed issuance by about $23B over those months, according to DeGroot, helping to extend munis' best first half rally since 2009.
- ETFs: MUB, HYD, BAB, PZA, MUNI, TFI, ITM, HYMB, MLN, CMF, SHM, BABZ, BABS, XMPT, PRB, SHYD, SUB, SMB, NYF, PZT, CXA, PWZ, PVI, SMMU, INY, MUAF, VRD, MUAD, MUAE, GMMB, MUAC, MUAG, RVNU, MUAH, FMB
May. 30, 2014, 2:47 AM
- Municipal-bond prices have soared so far in 2014, compared to the same time one year ago. 2013 was the markets worst year in almost two decades, after registering losses nationwide - ranging from Detroit's municipal bankruptcy-protection filing to pension costs in Illinois.
- The revival of the $3.7T municipal-bond market comes as bond buyers attempt to find higher investment returns amid dropping U.S. interest rates.
- Investors have also poured $3.1B into municipal-bond mutual funds this year, compared with $2.9Bn over the same period in 2013.
- Municipal bonds have returned 5.8% in 2014, reflecting interest payments and price appreciation.
- Yields on municipal debt fell to 2.3% this past Wednesday, which was their lowest in almost a year. Yields fall when prices rise.
- ETFs: MUB, HYD, BAB, PZA, MUNI, TFI, ITM, HYMB, MLN, CMF, SHM, BABZ, BABS, XMPT, PRB, SHYD, SUB, SMB, NYF, PZT, CXA, PWZ, PVI, SMMU, INY, MUAF, MUAD, VRD, MUAE, MUAG, MUAC, GMMB, FMB, RVNU, MUAH
May. 23, 2014, 10:52 AM
- 2013 produced the slowest annual rate of municipal debt growth in 20 years, says Moody's, which expects the trend to continue this year. The trend "reflects a new conservative attitude toward debt among the states," says analyst Kimberly Lyons.
- The slow pace of borrowing led to a decline in net-tax support debt (NTSD) per capita to $1,054 from $1,074 in 2012.
- In other news, municipal bond funds posted their third straight week of big inflows, adding $664M in the week ended on Wednesday (previous weeks saw $616M and $943M of inflows).
- ETFs: MUB, HYD, BAB, PZA, MUNI, TFI, ITM, HYMB, MLN, CMF, SHM, BABZ, BABS, XMPT, PRB, SHYD, SUB, NYF, SMB, PZT, CXA, PWZ, PVI, SMMU, INY, MUAF, MUAD, VRD, MUAE, MUAG, MUAC, GMMB, MUAH, RVNU, FMB
May. 15, 2014, 4:04 PM
- “A lot of the opportunities have been washed away in the last month and a half,” says BNY Mellon fixed income director John Flahive. “There really isn’t much out there.”
- The muni market is ahead 6.2% YTD, its strongest start since 2009, and benchmark 10-year muni yields have dipped to 2.29%. At work is the general rally in fixed income coupled with a decline in issuance.
- The fund has about $961M in assets vs. an original target size of $1B, and has beaten 83% of peers over the past five years.
- Muni ETFs: MUB, HYD, BAB, PZA, MUNI, TFI, ITM, HYMB, MLN, CMF, SHM, BABZ, BABS, XMPT, PRB, SUB, NYF, SHYD, SMB, PZT, CXA, PWZ, PVI, SMMU, INY, MUAF, MUAE, MUAD, VRD, GMMB, MUAC, MUAG, MUAH, RVNU
May. 12, 2014, 4:30 AM
- Stockton is due in court today for a four-day hearing today in which the bankrupt Californian city will attempt to win approval for a plan to pay creditor Franklin Resources (BEN) just 1% of the $35M that the company is owed.
- The case is rare, as these types of disputes are usually settled out of court. However, the hearing could presage a much larger showdown involving Detroit and its creditors.
- ETFs: MUB, HYD, BAB, PZA, MUNI, TFI, ITM, HYMB, MLN, CMF, SHM, BABZ, BABS, XMPT, PRB, SUB, SMB, SHYD, CXA, PWZ, PVI, SMMU, VRD, GMMB, RVNU
May. 8, 2014, 12:48 PM
- The First Trust Managed Municipal ETF (FMB) will offer investors current income through municipal bond investments which is exempt from regular federal income taxes.
- According to a statement issued by First Trust: "Recent tax increases have boosted the demand for tax-exempt investments. At the same time, some municipalities have been facing increasing economic challenges, raising the importance of active credit analysis and municipal bond expertise."
- There are currently three other actively managed municipal bond ETFs on the market, all of which feature a focus on maturity: the PIMCO Intermediate Municipal Bond Strategy (MUNI), the Columbia Intermediate Municipal Bond ETF (GMMB) and the PIMCO Short Term Municipal Bond Strategy ETF (SMMU).
- Other municipal bond ETFs: MUB, PZA, TFI, ITM, MLN, SHM, XMPT, PRB, SUB, SMB, PVI, VRD, RVNU
SMB vs. ETF Alternatives
The Market Vectors Short Municipal Index ETF (SMB) seeks to replicate as closely as possible, before fees and expenses, the price and yield performance of the Barclays Capital AMT-Free Short Continuous Municipal Index . The Index provides broad exposure to investment-grade municipal bonds with a nominal maturity of 1-6 years.
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