BlackRock's specialists note that investors seeking tax-advantaged yields can still find solid opportunities, but they need to be selective:
Municipal bond issuance is on pace to exceed $580 billion this year. At the same time, flows of new cash into muni bonds hit $56.6 billion in the first half of the year, the second-best start to any year:
"The key for the second half will be patience," said Patrick Haskell, head of the municipal bond group at BlackRock. "There will be opportunities, but you want to buy the right credits, the right structures, and the right levels. We are cautiously optimistic in the second half:"
Municipal bonds are a favorite among wealthy investors. Generally, they are safer than their corporate counterparts, as they tend to be backed by the full faith and credit of the taxing authority:
Tax-free yield is more valuable to individuals in higher income brackets:
Haskell's team also likes revenue bonds, particularly in the housing and transportation sectors:
