Home > Resources > Video Library > 5 Compelling Reasons to Consider an Investment in Munis Today
View From the Trade Floor

5 Compelling Reasons to Consider an Investment in Munis Today

Watch Group CIO Dan Ivascyn discuss the five factors driving value in municipal bonds today.

More from this section

Read Transcript

Text on screen: PIMCO

Text on screen: PIMCO provides services only to qualified institutions and investors. This is not an offer to any person in any jurisdiction where unlawful or unauthorized.

Text on screen: Daniel J. Ivascyn, Group Chief Investment Officer

Ivascyn: After a really, really tough 2022, where we saw muni yields rise and in some cases, particularly up the yield curve, rise quite sharply, we see a lot of value within the municipal and the tax free investing space.

Text on screen: 1. High yields

Images on screen: Suspension and arch bridge construction

Number one, yields are quite high in a historical context, slightly off the absolute highs we saw a few months ago, but still very, very attractive from a long term perspective. Then the really good news, of course,

Text on screen: 2. Declining inflation

Images on screen: Products scanned at a grocery store

is that inflation is beginning to decline. A more subtle point within the municipal market versus the taxable market is that you still have

Text on screen: 3. Steep yield curves

Images on screen: Large building construction site

quite steep yield curves, meaning by buying longer maturity municipal bonds, you pick up a significant relative yield advantage versus what you see in the taxable space.

Given the significant economic uncertainty, there is the ability to leverage the fact that municipal bonds, both at the investment grade level as well as the high yield segment of the distribution, have typically been much more

Text on screen: 4. Resilient credit performance

Images on screen: Overpass and highway construction

resilient from a credit performance perspective. And then finally, a lot of municipalities, even some of the areas of the market with lower ratings,

Text on screen: 5. Strong initial conditions

Images on screen: Underground water supply construction

have pretty strong initial conditions. So bottom line, I know it’s been a rocky road for interest rate sensitive segments of the opportunity set, but we do think that opportunities are looking a lot brighter, both from a yield and a total return perspective across this asset class.

Text on screen: For more insights and information, visit pimco.com

Text on screen: PIMCO

Disclaimer


Past performance is not a guarantee or a reliable indicator of future results.

Investing in the bond market is subject to risks, including market, interest rate, issuer, credit, inflation risk, and liquidity risk. The value of most bonds and bond strategies are impacted by changes in interest rates. Bonds and bond strategies with longer durations tend to be more sensitive and volatile than those with shorter durations; bond prices generally fall as interest rates rise, and low interest rate environments increase this risk. Reductions in bond counterparty capacity may contribute to decreased market liquidity and increased price volatility. Bond investments may be worth more or less than the original cost when redeemed. Income from municipal bonds is exempt from federal income tax and may be subject to state and local taxes and at times the alternative minimum tax.

Statements concerning financial market trends or portfolio strategies are based on current market conditions, which will fluctuate. There is no guarantee that these investment strategies will work under all market conditions or are appropriate for all investors and each investor should evaluate their ability to invest for the long term, especially during periods of downturn in the market. Investors should consult their investment professional prior to making an investment decision. Outlook and strategies are subject to change without notice.

PIMCO does not provide legal or tax advice. Please consult your tax and/or legal counsel for specific tax or legal questions and concerns.

PIMCO as a general matter provides services to qualified institutions, financial intermediaries and institutional investors. Individual investors should contact their own financial professional to determine the most appropriate investment options for their financial situation. This material contains the opinions of the manager and such opinions are subject to change without notice. This material has been distributed for informational purposes only and should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. Information contained herein has been obtained from sources believed to be reliable, but not guaranteed. No part of this material may be reproduced in any form, or referred to in any other publication, without express written permission. PIMCO is a trademark of Allianz Asset Management of America LLC in the United States and throughout the world. ©2023, PIMCO.

Pacific Investment Management Company LLC, 650 Newport Center Drive, Newport Beach, CA 92660, 800-387-4626.

CMR2023-0210-2734105

Filters: Reset All

Filters

Close Filters Dropdown

  • Tags

    Reset

    Close

  • Category

    Reset

    Bond by Bond
    Careers
    Economic and Market Commentary
    Investment Strategies
    PIMCO Foundation
    PIMCO Education
    View from the Investment Committee
    View From the Trade Floor
    Viewpoints
    Education
    Close

  • Order By

    Reset

    Alphabetical
    Most Recent
    Close
() filters applied

Multimedia Finder

Filter By:
  • Bond by Bond
  • Careers
  • Economic and Market Commentary
  • Investment Strategies
  • PIMCO Foundation
  • PIMCO Education
  • View from the Investment Committee
  • View From the Trade Floor
  • Viewpoints
  • Understanding Investing
  • A
  • B
  • C
  • D
  • E
  • F
  • G
  • H
  • I
  • K
  • L
  • M
  • N
  • P
  • Q
  • R
  • S
  • T
  • W
  • Z
Clear
Tina Adatia
Global and Core Fixed Income Product Strategist
Joshua Anderson
Portfolio Manager, Income and Asset-Backed Securities
Del Anderson
Credit Analyst
Robert Arnott
Founder and Chairman, Research Affiliates
Andrew Balls
CIO Global Fixed Income
Rachel Betton
Justin Blesy
Asset Allocation Strategist
Meredith Block
ESG Research Analyst
Allison Boxer
Economist
David L. Braun
Portfolio Manager
Jelle Brons
Portfolio Manager, Global Investment Grade Credit
Nathaniel Brown
Director of the PIMCO Foundation
Erin Browne
Portfolio Manager, Multi-Asset Strategies
Esteban Burbano
Fixed Income Strategist
Grover Burthey
Portfolio Manager, ESG
Libby Cantrill
Public Policy
John R. Cavalieri
Kenneth Chambers
Fixed Income Strategist
Stephen Chang
Portfolio Manager, Asia
Devin Chen
Portfolio Manager, Commercial Real Estate
Richard Clarida
Global Economic Advisor
Tony Crescenzi
Portfolio Manager, Market Strategist
Josh Davis
Global Head of Risk Management
Pramol Dhawan
Portfolio Manager
Devin Ekberg
Senior Consultant, Advisor Education
David Fisher
Co-Head of Strategic Accounts, U.S. Global Wealth Management
David Forgash
Portfolio Manager
Nick Granger
Portfolio Manager, Quantitative Analytics
Adam Gubner
Portfolio Manager, Distressed Debt
Bill Gurtin
Gregory Hall
Head of U.S. Global Wealth Management
David Hammer
Portfolio Manager
Mary Hoppe
Ray Huang
Portfolio Manager, Real Estate
Daniel H. Hyman
Portfolio Manager
Daniel J. Ivascyn
Group Chief Investment Officer
Henry Kao
Account Manager, Stable Value
Mark R. Kiesel
CIO Global Credit
Erica Kinsella
Product Strategist, ESG Strategies
Sean Klein
Head of Client Business Strategy – Client Solutions and Analytics
Brian Kyle
Global Wealth Management
Kaboo Leung
Michael Levinson
Portfolio Manager, Leveraged Finance
Christine Long
Head of Retirement Marketing
Raji O. Manasseh
Equity Strategist
Chantal Manseau
Rene Martel
Head of Retirement
Samuel Mary
ESG Research Analyst
Kyle McCarthy
Alternative Credit Strategist
Sean Meeker
Head of Business Development - Capital Markets (US)
Mohit Mittal
Portfolio Manager, Multi-Sector
Alfred T. Murata
Portfolio Manager, Mortgage Credit
John Murray
Portfolio Manager, Global Private Real Estate
John Nersesian
Head of Advisor Education
Roger Nieves
Rick Pagnani
Head of Insurance-Linked Securities
Sonali Pier
Portfolio Manager, Multi-Sector Credit
Christina Pihos
Defined Contribution Marketing
Steven Pogorelec
Global Wealth Management
Chitrang K. Purani
William Quinones
Product Strategist
Lupin Rahman
Portfolio Manager
Libby Rodney
Steve A. Rodosky
Portfolio Manager
Emmanuel Roman
Chief Executive Officer
Steve Sapra
Senior Advisor
Jerome M. Schneider
Portfolio Manager
Marc P. Seidner
CIO Non-traditional Strategies
Emmanuel S. Sharef
Portfolio Manager, Asset Allocation and Multi Real Asset
Greg E. Sharenow
Portfolio Manager, Commodities and Real Assets
Anmol Sinha
Candice Stack
Head of Client Management, Americas
Kimberley Stafford
Global Head of Product Strategy
Cathy Stahl
Global Head of Marketing
Christian Stracke
Global Head of Credit Research
Geraldine Sundstrom
Portfolio Manager, Asset Allocation, EMEA
Richard Thaler
Distinguished Service Professor of Economics and Behavioral Science at the University of Chicago's Booth School of Business
Mark Thomas
Account Manager, Global Wealth Management
Jessica K. Tom
Senior Credit Analyst
Francois Trausch
D. Alan Trice
Jerry Tsai
Client Solutions and Analytics
Megan Walters
PIMCO Prime Real Estate
Qi Wang
CIO Portfolio Implementation
Jamie Weinstein
Portfolio Manager, Corporate Special Situations
Tiffany Wilding
Economist
Andrew T. Wittkop
Portfolio Manager, Treasuries, Agencies, Rates
Jerry Woytash
Portfolio Manager, Short-Term Desk
Kirill Zavodov
Portfolio Manager
Chris Brightman
Chief Executive Officer and Chief Investment Officer, Research Affiliates
PIMCO
Ben Bernanke
Chair, Global Advisory Board
Seray Incoglu
Portfolio Manager, Commercial Real Estate
  • Alphabetical
  • Most Recent
Section : Date : Experts :
Reset All
Two Former Fed Leaders Decode Central Banks: Part 2 (video)
Economic and Market Commentary

Two Former Fed Leaders Decode Central Banks: Part 2(video)

Two Former Fed Leaders Decode Central Banks: Part 2

In this two-part series, former Fed chairman Dr. Ben Bernanke, who is now a senior advisor at PIMCO, and Dr. Richard Clarida, a former Fed vice chairman who now is PIMCO’s global economic advisor, share policymakers’ playbook for navigating global challenges. For other insights and our latest economic outlook visit: pimco.com/secular.

WATCH PART 1

Two Former Fed Leaders Decode Central Banks: Part 1
Economic and Market Commentary

Two Former Fed Leaders Decode Central Banks: Part 1(video)

Two Former Fed Leaders Decode Central Banks: Part 1

In this two-part series, former Fed chairman Dr. Ben Bernanke, who is now a senior advisor at PIMCO, and Dr. Richard Clarida, a former Fed vice chairman who now is PIMCO’s global economic advisor, share policymakers’ playbook for navigating global challenges. For other insights and our latest economic outlook visit: pimco.com/secular.

WATCH PART 2

Positioning Portfolios for Today’s Markets