Municipal Bond Forum
After selling, ready to re-enter muni market
Q
I sold $1.2 million in various AAA munis in the last four months. I bought at the bottom and my capital gains equaled three to four years of interest. I had to take it before taxes rise; now I’m waiting to get back in. I’m less than thrilled with picks from my bank/brokerage and their lack of knowledge. They put me in high risk bonds without telling me. Is there a fee to open an account with you? Can I trade munis? Are you an order taker, or do you give advice? I am 46, and have never been more fearful about all markets.
A
James A. Klotz responds:
Although we are pleased to hear you have produced substantial gains with your bonds, we are not a firm that believes in trading municipal bonds for capital gains.
We think bonds should be purchased for income and always recommend a “buy and hold” strategy, unless there is a tax advantage to be gained by a bond exchange.
We assist our clients by helping them select bonds that pay a steady rate of return, while enabling them to feel comfortable with their investments.
We have never seen anyone accurately predict the future direction of interest rates for any sustained period of time, and with fixed income investing, being out of the market for any length of time can become costly, particularly when you guess wrong.
All prices on our website are net to the investor. There are no additional fees or costs.
Please contact us if you would like to discuss this in further detail.
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This report is produced solely for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. This report is based on information obtained from sources believed to be reliable but no independent verification has been made, nor is its accuracy or completeness guaranteed.