Investors seek municipal bonds for the tax free yield, low default rate, and as a diversifier to a portfolio. We aim to increase a client’s tax free income by 15-20% through our methodology. Please see our current quarterly fact sheet which is a composite of our client’s accounts.
The yield of a municipal bond and of the composite portfolio is the key metric for the Watkinson Capital Advantage Strategy.
Our goal is to maximize an investor's yield without downgrading in quality nor extending in quality. We also compare a TEY (taxable equivalent yield) to US Treasuries, US Corporate Bonds, CDs, Money markets and savings accounts.
The market price of a MuniBond will fluctuate due to interest rate movement along with the market forces of supply/demand. However, upon purchase, the investor of the MuniBond knows exactly how the story will end.
This investor will know when and how much interest this bond will pay and when the bond will mature, thus returning all capital to the investor.