Municipal Bond Forum
Is rating important on insured municipal bonds?
Q
If I buy only insured muni bonds, do I still need to be concerned with the bonds’ rating?
A
James A. Klotz responds:
As an investor, you should always be the one who determines the degree of security you are comfortable with, based on your personal risk tolerance.
As you know, most “investment-grade” rated municipal bonds provide an adequate degree of security, as evidenced by their very low default rate.
Insurance provides an additional layer of credit quality, but it is always prudent to evaluate the underlying security.
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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.