Three ETFs that are likely to be influenced if the municipal bond market melts down are: SPDR Nuveen Barclays Capital Municipal Bond ( TFI) SPDR Nuveen S&P VRDO Muni Bond ( VRD) Market Vectors High Yield Muni ETF ( HYD) Investors in ETFs like these can benefit from using an exit strategy that identifies price points at which systemic risk may cause the ETFs' values to fall. Such a strategy can be found at www.SmartStops.net. -- Written by Kevin Grewal in Laguna Niguel, Calif.At the time of publication, Grewal had no positions in equities mentioned.
Investors in SPDR Nuveen Barclays Municipal Bond ETF saw new options become available this week, for the June 19th expiration. One of the key inputs that goes into the price an option buyer is willing to pay, is the time value, so with 165 days until expiration the newly available contracts represent a potential opportunity for sellers of puts or calls to achieve a higher premium than would be available for the contracts with a closer expiration.