Municipal Bond Forum
Buy, sell or hold tobacco bonds?
Q
What is your feeling on tobacco bonds – buy, hold or sell? Prices are way down. How much risk is there in holding?
A
James A. Klotz responds:
I would not sell tobacco bonds today at these depressed prices unless they were keeping me up at night or I had an overconcentration of these securities in my portfolio.
If the current decline in domestic sales continues, we think maturities could be extended but we don’t see any indications of potentially missed interest payments at this time.
If there is a rally in these securities, you might want to consider lightening up.
Start here.
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The responses provided in this forum are meant to address specific questions posed by investors about their municipal bonds and to provide market insight for our general audience. Please note, your investments, objectives, results and experience may differ significantly. Our answers and any potential strategies discussed should not be construed as a solicitation to buy nor sell any security or investment product. All investing entails risk.