This is a terrific explanation by the MSRB, the Municipal Securities Rulemaking Board. We label these bonds "Anytime 30-Day Call Bonds"... or "A Bond an investor will never see at a Brokerage firm"
"When a bond reaches the call date without being redeemed, the call feature usually reverts to a 30-day rolling call. This means, the issuer can redeem the bonds at any time with 30 days’ notice to investors." page 1
Because the bond can be called at par with 30-days notice, investors are hesitant to pay a premium. Hence, these Bonds tend to trade very close to par.
At times, over the low interest rate environment of the last decade, when one had to go out 10years to get a 1% yield on an AAA #MuniBond, we had these bonds yielding over 5% tax-exempt on the books for years.
Contact me if you want to get these #Bonds in your portfolio.
Compare the MSRB "Negative Yield Bonds" write up to my writeup..
#munis #municipalBonds #TaxFreeIncome #MunicipalBond #MuniBondVana