Municipal Bond Mutual Fund News

Week 5, 2011 Municipal Bond and Mutual Funds News – More Municipal bond outflows

municipal bonds

This week (January 28 – February 4, 2011) saw continued media coverage of the Municipal bond crisis. Net mutual fund redemptions totaled $2.7 billion in the seven days that ended Jan. 26, down from $5.7 billion the previous week but still the 12th straight week of net withdrawals. Mostly unchanged, but a down week for FSTFX, VCAIX but more bad news for the municipal bond market dominates the headlines. This weeks municipal bond news included:

  • State governors strongly oppose bankruptcy protection changes. (Bond Buyer)
  • State tax revenue is growing, but it won’t bridge budget gaps (WSJ)
  • Are Muni bonds fears overblown? (WSJ)
  • Muni bond yields rise and prices fall. (LA Times)

Vanguard Municipal Bond Mutual Fund Weekly Price Movement

Vanguard tax-exempt California Money Market fund (VCTXX) is yielding 0.15% – Up 0.02% for the week.

Vanguard Short Term Tax-Exempt Fund (VWSTX) 0.0% for the week.
Month to date: -0.0%. December 2010 -0.14%. Current Yield 0.85%.

Average maturity 1.3 years – Average Duration: 1.2 Years – Average Credit quality: AA. Exp Ratio: 0.20%, 0.12% Admiral shares. Morningstar Rating: 3 Star

Vanguard Limited Term Tax-Exempt Fund (VMLTX) 0.0% for the week.
Month to date: -0.20%. December 2010 -0.43%. Current Yield 1.50%.

Average maturity 2.7 years – Average Duration: 2.4 Years – Average Credit quality: AA. Exp Ratio: 0.20%, 0.12% Admiral shares. Morningstar Rating: 4 Star

Vanguard Intermediate Term Tax-Exempt Fund (VWIUX) 0.0% for the week. Month to date: -1%. December -1.53%. Current Yield 3.43%.

Average maturity 6.7 years. Average duration 5.8 years. Average credit quality AA. Expense ratio 0.20%, 0.12% Admiral shares. Morningstar rating 5 stars.

Vanguard California Intermediate term municipal bond fund (VCAIX) -0.09% for the week. Month to date: -1.19%. December -1.69%. Current Yield 3.64%.

Average maturity 6.3 years. Average duration 5.8 years. Average credit quality A. Expense ratio 0.20%, 0.12% Admiral shares. Morningstar rating 4 stars.

Fidelity Municipal Bond Mutual Fund Weekly Price Movement

Fidelity Short-Intermediate Muni Income Bond Fund (FSTFX) -0.09% for the week.
Month to date: -0.46%. December 2010 -0.63%. Current Yield 1.75%.

Average maturity 3.4 years – Average Duration: 2.7 Years – Average Credit quality: A. Exp Ratio: 0.50% Morningstar Rating: 4 Star

Fidelity California Intermediate term municipal bond fund (FCSTX) 0.0% for the week.
Month to date: -0.37%. December 2010 -0.64%. Current Yield 1.83%.

Average maturity 3.3 years. Average duration 3.1 years. Average credit quality A. Expense ratio 0.35%. Morningstar rating 4 stars.

See how the Fidelity intermediate term municipal bond fund (FCSTX) and Vanguard California intermediate term municipal bond fund (VCAIX) performed this week on this graph:

See how the municipal bond mutual funds we listed above performed this month on this graph:

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