While we’ve been buying and laddering T-Bills for some time now, it’s time to add some different bonds with potential for growth. We added small positions in BBN and NEA and will likely add after the next Fed meeting in December. We expect BBN and NEA to drop after the Fed meeting, assuming the Fed hikes again, because bonds typically react in the opposite direction to yields.
Both of these tickers are bonds and each has a different purpose. NEA is a tax efficient bond fund made up of municipal bonds which are free from federal income tax.
Nuveen AMT-Free Quality Municipal Income Fund is a closed-ended fixed income mutual fund launched by Nuveen Investments Inc. The fund is co-managed by Nuveen Asset Management, LLC and Nuveen Fund Advisors LLC. It invests in the fixed income markets of the United States. The fund primarily invests in undervalued municipal bonds that are exempt from federal income taxes, including the alternative minimum tax. It seeks to invest in securities that are rated Baa/BBB or better by S&P, Moody’s, or Fitch. The fund’s investment portfolio comprises investments in various industries, which include transportation, healthcare, utilities, housing/multifamily, and water and sewer. It was formerly known as Nuveen AMT-Free Municipal Income Fund. Nuveen AMT-Free Quality Municipal Income Fund was formed on November 21, 2002 and is domiciled in the United States.
Finance Yahoo
BBN is a taxable bond fund that invests in Build Back Better bonds and given the election results, it seems that at least some of the current administration’s agenda will be moving forward.
BlackRock Taxable Municipal Bond Trust is a closed-ended fixed income mutual fund launched by BlackRock, Inc. It is managed by BlackRock Advisors, LLC. The fund invests in the fixed income markets of the United States. It primarily invests in taxable municipal securities, which include Build America Bonds. The fund also invests in tax-exempt securities, U.S. treasury securities, obligations of the U.S. government, its agencies and instrumentalities, and corporate bonds. It was formerly known as BlackRock Build America Bond Trust. BlackRock Taxable Municipal Bond Trust was formed on August 27, 2010 and is domiciled in the United States.
Finance Yahoo
At some point, the Fed will stop hiking interest rates and when that happens we expect bond prices to rise as rates stabilize and move back down. We don’t know when that will be so we’ll start dollar cost averaging our way down and perhaps add some additional positions through naked puts.
We’ll keep you posted but in the meantime, stay tuned and stay solvent…