1. Municipal Bonds Red October
October 31, 2018
JR Rieger
JR@RiegerReport.com| (516) 524-1110 | riegerreport.com
2. October 31, 2018
1 (516) 524-1110 JR@RiegerReport.com | www.theriegerreport.com
Municipal Bonds Can’t Escape Red October
• The S&P Municipal Bond Index fell 0.66% in October and is down 0.82% year-to-date
• Taxable municipal bonds tracked in the S&P Taxable Municipal Bond Index fell 0.77% in October and is down 1.88% year-to-date
• Municipal bond sectors spooked the worst:
• S&P Municipal Bond Tobacco Index (Tobacco Settlement bonds) was down 2.92% in October (the index is up 3.82% year-
to-date.
• Impacted by Tobacco bonds, the S&P Municipal Bond High Yield Index was down 1.2% in October (the index is up 4.17%
year-to-date)
• The 10 year range tracked in the S&P Municipal Series 2028 was down 1.11% in October and is down 3.16% year-to-date.
Yielding 3.1% the index is jus a few bps cheaper than the 10 year MBIS AA Municipal Curve.
• Yield curve shifts in October:
10 Year AAA Municipal Bonds +28bps
10 Year US Treasury Bond +10bps
10 Year Apple Inc. Bonds +27bps
Data as of 10/31/2018. Sources: Municipal bond yields & performance data sourced from The Bond Buyer www.bondbuyer.com
Data Workstation and MBIS www.mbis.com and S&P Dow Jones Indices www.spdji.com . Apple Inc. bond yields provided by SQX
https://sqx.com/
3. October 31, 2018
1 (516) 524-1110 JR@RiegerReport.com | www.theriegerreport.com
Data as of 10/31/2018. Sources: Municipal bond yields sourced from The Bond Buyer www.bondbuyer.com Data Workstation and
MBIS www.mbis.com , U.S. Treasury bond yields sourced from the U.S. Department of the Treasury www.treasury.gov and the S&P
500 Dividend Yield data as of 10/26/2018 and was sourced from S&P Dow Jones Indices www.spdji.com . Current indicated dividend
yield is used. Chart is provided for illustrative purposes only.
73%
71%
72%
78%
84%
93%
103% 104%
70%
75%
80%
85%
90%
95%
100%
105%
110%
1.25
1.75
2.25
2.75
3.25
3.75
0 5 10 15 20 25 30 35
%ofUSTYield
Yield%
Year
AAA Municipal Bond Yields
Relative to UST Yields & S&P 500 Dividend Yield
AAA Muni Yield US Treasury Yield S&P 500 Dividend Yield % of UST Yield
S&P 500 Dividend Yield 2.07%
4. October 31, 2018
1 (516) 524-1110 JR@RiegerReport.com | www.theriegerreport.com
1.5
2
2.5
3
3.5
4
4.5
5
5.5
6
0 5 10 15 20 25 30
Yield%
Year
AAA Municipal Bond Yields & Taxable Equivalent
Yields v.
U.S. Treasury Bond Yields
AAA Muni UST TEY 37% TEY 32% TEY 24% TEY 12% TEY 10%
Data as of 10/31/2018. Sources: Municipal bond yields sourced from the Bond Buyer Data Workstation www.bondbuyer.com and MBIS
www.mbis.com Municipal Yield Curves, U.S. Treasury bond yields sourced from the U.S. Department of the Treasury www.treasury.gov. Chart is
provided for illustrative purposes only. TEY = Taxable Equivalent Yield at tax rate assumption stated.
Munis are rich here
5. October 31, 2018
1 (516) 524-1110 JR@RiegerReport.com | www.theriegerreport.com
1.5
2
2.5
3
3.5
4
4.5
5
5.5
6
0 5 10 15 20 25 30
Yield%
Year
AAA Municipal Bond Yields & Taxable Equivalent
Yields v.
Apple Inc. Corporate Bond Yields
AAA Muni Apple Inc. TEY 37% TEY 32% TEY 24% TEY 10%
Data as of 10/31/2018. Sources: Apple Inc. bond yields provided by SQX https://sqx.com/ . Municipal bond yields sourced from the Bond Buyer
Data Workstation www.bondbuyer.com and MBIS www.mbis.com. Chart is provided for illustrative purposes only. TEY = Taxable Equivalent
Yield at tax rate assumption stated.
6. October 31, 2018
1 (516) 524-1110 JR@RiegerReport.com | www.theriegerreport.com
1.5
2
2.5
3
3.5
4
4.5
5
5.5
6
0 5 10 15 20 25 30
Yield%
Year
AA Municipal Bond Yields & Taxable Equivalent
Yields v.
Apple Inc. Bond Yields
AA Muni Apple Inc. TEY 37% TEY 32% TEY 24% TEY 10%
Data as of 10/31/2018. Sources: Apple Inc. bond yields provided by SQX https://sqx.com/ . Municipal bond yields sourced from the Bond Buyer
Data Workstation www.bondbuyer.com and MBIS www.mbis.com. U.S. Treasury bond yields sourced from U.S. Department of the Treasury
www.treasury.gov. Chart is provided for illustrative purposes only. TEY = Taxable Equivalent Yield at tax rate assumption stated.
Munis show their value here
7. October 31, 2018
1 (516) 524-1110 JR@RiegerReport.com | www.theriegerreport.com
• Municipal bond yields: the Bond Buyer Data Workstation
https://dataworkstation.bondbuyer.com/
• Municipal bond yields: MBIS https://mbis.com/
• Apple Inc. bond yields: SQX https://sqx.com/
• U.S. Treasury bond yields: U.S. Department of Treasury
https://www.treasury.gov
Data Resources Used in this Report
8. October 31, 2018
1 (516) 524-1110 JR@RiegerReport.com | www.theriegerreport.com
Notes:
• Taxable Equivalent Yield = Tax Exempt Yield / (1 – Federal Tax Rate)
• 2018 tax brackets, however not all tax brackets are represented herein
• End of day yields are used
Analyst Disclosure:
• JR Rieger and or the Rieger Report LLC has not received compensation either directly or indirectly from the
sponsor(s) of the ETF(s) included in this report.
• At the time of this writing, JR Rieger does not own the ETF(s) cited in this report, nor bonds issued by Apple Inc.
• Between July 1st and July 13th 2018, JR Rieger purchased insured municipal bonds and AA and higher rated
municipal bonds in the 8 – 14 year maturity range. In September 2018 JR Rieger purchased insured municipal
bonds in the 10 year range.