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High-Yield Muni ETFs Remain Excellent Buys

Jim Colby of Van Eck Global says investors are best off diversifying their municipal bond portfolios instead of buying individual Puerto Rico bonds for their high yields.

Discounts in muni-bond closed-end funds have narrowed recently, but they remain a good buy, says Jim Colby, Senior Municipal Strategist at Van Eck Global. Colby says high-yield munis are especially attractive because spreads remain wide. He says he is seeing high-yield corporate bond investors cross over into the high-yield muni space. Finally, he says investors are best off diversifying their municipal bond portfolios instead of buying individual Puerto Rico bonds for their high yields.

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