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APA’s Insights on Current Market ConditionsJune 20, 2013
Municipal Credit UpdateSeptember 04, 2012
Credit research. How has the game changed?May 30, 2012
Beginning with his remarks May 22nd before a Congressional committee and again on June 19 at a press conference following
APA Special Market ReportInterest Rates and Municipal Bonds Headlines declaring the end of the 30 year bull market for bonds coupled with May’s
APA’s Response to Stockton BankruptcyOn June 27, 2012, the City Council of Stockton, California voted 6 -1 to adopt a spending plan for operating
Commentaries
Taxable and Tax Free Municipal Bonds: Better Value and Higher Yields vs. Corporate Bonds
By: admin / November 8th, 2012
Taxable and Tax Free Municipal Bonds: Better Value and Higher Yields vs. Corporate Bonds
Asset Preservation Advisors (APA) believes that investors should continue to invest in highly-rated municipal bonds and diversify their income stream by purchasing taxable municipal bonds. Even with market place discussions debating the advantages of adding corporate bonds to a portfolio, APA believes corporate bonds do not offer the value, given current market conditions, of taxable municipal securities. Rather, we believe that investors should continue to add highly rated taxable and tax-exempt municipal securities to their portfolios while avoiding corporate bonds. Taxable municipals bonds are currently providing higher yields than corporates with similar credit ratings and maturities. In addition, an investor’s “credit risk” increases with corporate bonds given their historically higher rates of default. Moreover, corporate spreads are so expensive at this time that with some maturities, tax-exempt bonds can yield more than corporates with similar risk profiles.
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