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while many investors are aware of the “yield curve inversion” in the U.S. Treasury market, investors can gain significant incremental yield by focusing on intermediate and longer-term maturities in California municipal bonds due to the steeper municipal yield curve. (See Figure 2.)
When rates reached their peak in October 2023, munis reached a yield-to-worst of 4.46%, which was their highest level since 2009 and 1.87x the 14-year average. While current yields have fallen since October, they are still at relatively high levels.
In Figure 1, we can see that California municipal bonds offered an attractive tax-equivalent yield to both top and median earners. Figure 1: California munis offer compelling tax-equivalent yields —
bond yield curve, as shown in Figure 1. This relative steepness may not seem newsworthy, as the municipal yield curve has consistently remained upward-sloping while its Treasury counterpart has inverted at times. As of mid-June, the two- to 30-year slope of the AAA Muni curve was 132 basis points (bps), compared to a flat slope for Treasuries.
25 paź 2024 · California Municipal Bonds - October 25, 2024. California Yield Curve. This content requires the Adobe Flash Player. Get Flash. Real-time data on all CUSIPs, the latest muni bond news, the ins and outs of bond investing and track your municipal bond portfolio at the Premier site for Municpal bond investors.
Bond Fund (NCHRX) and Nuveen California Municipal Bond Fund (NCSPX). * If you are investing $250,000 or more, you may be eligible to purchase Class A shares of this Fund without a sales charge.
Municipal bond yields increased 7 to 15 basis points across the curve underperforming U.S. Treasuries. Strategically, our 10–20-year maturity illustration continues to offer an excellent tax efficient solution.
