Two CEFs Offering Tax Equivalent Yields of 13%

With rates still near record lows, it's hard to find a reasonably safe investment to earn an attractive return. However, there are some interesting places to get paid high yields if you look at closed end bond funds. Both of the two funds I found invest most of their portfolios in municipal bonds which are exempt from federal taxes. These funds trade at a premium to net asset value which means you should try to buy on dips. Some investors are concerned that with all the budget deficits, some municipalities will default. Meredith Whitney recently predicted that there would be 50 to 100 municipal bonds defaulting in 2011 totaling hundreds of billions of dollars. However, Alexandra Lebenthal, President of Lebenthal & Co., and a well known muni bond expert does not agree with that assessment. Meredith Whitney made the prediction on December 19, and according to Lebenthal, only two muni... Read more

Older articles featuring NMZ: