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Heard on the prairie; Municipal bond funds feel the crunch.(BUSINESS)
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Star Tribune (Minneapolis, MN)
- Article date:
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March 16, 2008
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Copyright informationCOPYRIGHT 2008 Star Tribune Co. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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Byline: KARA McGUIRE; STAFF WRITER
Dull but dependable and tax-free to boot. That's the appeal of municipal bonds and muni-bond funds. But the credit crisis is leaving no asset class untouched.
Municipal bond yields rose at the end of February, causing returns on Minnesota municipal bond funds to nose-dive to a level not seen since 2000.
According to Lipper, the cumulative total return in February for Minnesota Municipal Debt Funds was minus 4.38 percent.
"Some of the turmoil in the mortgage market has created investment volatility in some of the unlikeliest places," said Colin Lundgren, a fixed-income portfolio manager with RiverSource Investments in ...