Heyer Capital, LLC

investment management and timely advice from a local CPA (Fox Valley, Wisc.)

Get bids on municipals

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There is extraordinary stress in the municipal bond market right now.    Bonds that aren’t traded frequently are priced according to a matrix (yields, credit risks, liquidity, recent similar deals, etc.)  In other words, a best, reasonable guess.    Want to make your broker squirm?  Send him/her an written request for bids from his/her broker-dealer to buy all of your municipals bonds.  I won’t suggest selling them at those prices, but this is a great time for folks to learn the difference between prices paid on “your money” and “their money.”    Anecdotally I’ve heard of mispricing of upwards of 10%.

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Written by heyercapital

February 29, 2008 at 11:06 am

Posted in Business/Econ

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