After my three day rant on municipal bonds around Thanksgiving, I wanted to follow-up with some stats. While the recent heightened volatility and potential for higher rates stands at the forefront of
risks in this space, so does opportunity cost.
The research folks at GW&K have put together some useful data on cash versus intermediate- and longer-term municipal bonds. Over the past 19 years, the municipal money market fund (SIFMA) has
outperformed 5- and 10-year muni bonds just twice. It just so happens that this outperformance has occurred in only the two …