Scott F

Muni Funds: CEFs vs. ETFs in 2009

ETFs cannot use leverage in the manner of CEFs, so all muni ETFs are unleveraged. Picking CEF munis purely on current discount is a risky game. Many are at deep discounts for good reason: junky portfolios, bad management, excessive fees. Far better to find historically wide discounts in lower cost CEF munis with low call ratios and decent ratings. That all being said, credit ratings are near worthless and so are the rating companies. Proceed cautiously.