According to the Wall St. Journal For some investors in the municipal-bond market, June added insult to injury. In an otherwise bleak month for many investments, tobacco bonds were star performers, rising an average of 10%. Some jumped more than 60%.
But many municipal-bond funds missed out on the gains. They had been forced to sell the bonds months earlier, often at a big loss, after a credit-rating downgrade made them noninvestment grade.
Instead, the big beneficiaries were hedge funds that scooped up the bonds at pennies on the dollar. Municipal bonds overall returned 0.35% in June, according to Barclays Capital's municipal-bond index….
Find out more at http://online.wsj.com/article/SB10001424052702304793504576432222653933718.html?mod=WSJ_hp_LEFTWhatsNewsCollection
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