This document discusses tax management strategies for municipal bonds. It notes that standard bond valuation models do not account for taxes, which impacts prices. It presents an analytical framework that overlays taxes onto standard bond valuation to determine an after-tax value. This allows for identifying opportunities to harvest tax losses or gains from sales. The value of the "tax option" to execute such trades depends on interest rate volatility. Selling when the tax efficiency signal is high realizes most of the tax option value. While tax management can significantly boost after-tax returns, it is largely ignored in practice currently.
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when will pi network coin be available on crypto exchange.DOT TECH
There is no set date for when Pi coins will enter the market.
However, the developers are working hard to get them released as soon as possible.
Once they are available, users will be able to exchange other cryptocurrencies for Pi coins on designated exchanges.
But for now the only way to sell your pi coins is through verified pi vendor.
Here is the telegram contact of my personal pi vendor
@Pi_vendor_247
how can i use my minded pi coins I need some funds.DOT TECH
If you are interested in selling your pi coins, i have a verified pi merchant, who buys pi coins and resell them to exchanges looking forward to hold till mainnet launch.
Because the core team has announced that pi network will not be doing any pre-sale. The only way exchanges like huobi, bitmart and hotbit can get pi is by buying from miners.
Now a merchant stands in between these exchanges and the miners. As a link to make transactions smooth. Because right now in the enclosed mainnet you can't sell pi coins your self. You need the help of a merchant,
i will leave the telegram contact of my personal pi merchant below. 👇 I and my friends has traded more than 3000pi coins with him successfully.
@Pi_vendor_247
how to sell pi coins in South Korea profitably.DOT TECH
Yes. You can sell your pi network coins in South Korea or any other country, by finding a verified pi merchant
What is a verified pi merchant?
Since pi network is not launched yet on any exchange, the only way you can sell pi coins is by selling to a verified pi merchant, and this is because pi network is not launched yet on any exchange and no pre-sale or ico offerings Is done on pi.
Since there is no pre-sale, the only way exchanges can get pi is by buying from miners. So a pi merchant facilitates these transactions by acting as a bridge for both transactions.
How can i find a pi vendor/merchant?
Well for those who haven't traded with a pi merchant or who don't already have one. I will leave the telegram id of my personal pi merchant who i trade pi with.
Tele gram: @Pi_vendor_247
#pi #sell #nigeria #pinetwork #picoins #sellpi #Nigerian #tradepi #pinetworkcoins #sellmypi
The secret way to sell pi coins effortlessly.DOT TECH
Well as we all know pi isn't launched yet. But you can still sell your pi coins effortlessly because some whales in China are interested in holding massive pi coins. And they are willing to pay good money for it. If you are interested in selling I will leave a contact for you. Just telegram this number below. I sold about 3000 pi coins to him and he paid me immediately.
Telegram: @Pi_vendor_247
Even tho Pi network is not listed on any exchange yet.
Buying/Selling or investing in pi network coins is highly possible through the help of vendors. You can buy from vendors[ buy directly from the pi network miners and resell it]. I will leave the telegram contact of my personal vendor.
@Pi_vendor_247
If you are looking for a pi coin investor. Then look no further because I have the right one he is a pi vendor (he buy and resell to whales in China). I met him on a crypto conference and ever since I and my friends have sold more than 10k pi coins to him And he bought all and still want more. I will drop his telegram handle below just send him a message.
@Pi_vendor_247
Turin Startup Ecosystem 2024 - Ricerca sulle Startup e il Sistema dell'Innov...Quotidiano Piemontese
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where can I find a legit pi merchant onlineDOT TECH
Yes. This is very easy what you need is a recommendation from someone who has successfully traded pi coins before with a merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi network coins and resell them to Investors looking forward to hold thousands of pi coins before the open mainnet.
I will leave the telegram contact of my personal pi merchant to trade with
@Pi_vendor_247
how to sell pi coins at high rate quickly.DOT TECH
Where can I sell my pi coins at a high rate.
Pi is not launched yet on any exchange. But one can easily sell his or her pi coins to investors who want to hold pi till mainnet launch.
This means crypto whales want to hold pi. And you can get a good rate for selling pi to them. I will leave the telegram contact of my personal pi vendor below.
A vendor is someone who buys from a miner and resell it to a holder or crypto whale.
Here is the telegram contact of my vendor:
@Pi_vendor_247
how can I sell pi coins after successfully completing KYCDOT TECH
Pi coins is not launched yet in any exchange 💱 this means it's not swappable, the current pi displaying on coin market cap is the iou version of pi. And you can learn all about that on my previous post.
RIGHT NOW THE ONLY WAY you can sell pi coins is through verified pi merchants. A pi merchant is someone who buys pi coins and resell them to exchanges and crypto whales. Looking forward to hold massive quantities of pi coins before the mainnet launch.
This is because pi network is not doing any pre-sale or ico offerings, the only way to get my coins is from buying from miners. So a merchant facilitates the transactions between the miners and these exchanges holding pi.
I and my friends has sold more than 6000 pi coins successfully with this method. I will be happy to share the contact of my personal pi merchant. The one i trade with, if you have your own merchant you can trade with them. For those who are new.
Message: @Pi_vendor_247 on telegram.
I wouldn't advise you selling all percentage of the pi coins. Leave at least a before so its a win win during open mainnet. Have a nice day pioneers ♥️
#kyc #mainnet #picoins #pi #sellpi #piwallet
#pinetwork
what is the best method to sell pi coins in 2024DOT TECH
The best way to sell your pi coins safely is trading with an exchange..but since pi is not launched in any exchange, and second option is through a VERIFIED pi merchant.
Who is a pi merchant?
A pi merchant is someone who buys pi coins from miners and pioneers and resell them to Investors looking forward to hold massive amounts before mainnet launch in 2026.
I will leave the telegram contact of my personal pi merchant to trade pi coins with.
@Pi_vendor_247
1. 61 Broadway New York, NY 10006 212.482.0900 www.kalotay.com
Tax Management of Municipal Bonds
Abbreviated Version
Charleston, SC, April 18,2014
2. 2
Unique Challenges of Managing Munis
Bond values depend on taxes on gains and losses
Standard systems ignore taxes; reported interest rate risk and
credit risk measures are unreliable
Theoretical bond valuation framework has been extended to
include taxes
Main topic: maximizing after-tax return
How to calculate benefit from selling
How to decide when to sell
Need after-tax analytics
3. 3
When Rates Rise Prices Will Fall More Than Expected
Bond Buyer, March 18, 2013
Single-A
Par Bonds
Rates Rise 100bps
Standard Approach Kalotay Approach
Mistake by
Standard Approach
Price Yield Price Yield Price
Yield
(bps)
2-yr 0.90% 98.05 1.90 96.82 2.54 -1.23 64
5-yr 1.65% 95.35 2.65 92.84 3.21 -2.51 56
10-yr 3.00% 91.82 4.00 88.94 4.38 -2.88 38
4. 4
Taxation of Tax-Exempt Munis Held to Maturity
Gain is taxable at maturity, but loss is not deductible
Large gain taxed as ordinary income
Small gain (purchase above de minimis threshold) taxed as
capital gains
When rates rise, tax on gain to new buyer depresses price
But ‘hold value’ depends on current investor’s purchase date and
price, and can differ from market price
5. 5
Analytical Approach:
Overlay Taxes on Standard OAS Framework
Incorporate taxes on capital gains and losses
Including callables and OID’s
Assume investors are in the top tax bracket
Key concepts: tax-neutral value and OAS
Tax-neutral value is the PV of after-tax cashflows, including tax
at maturity; determined iteratively
Tax-neutral OAS adjusts for both call option and taxes
7. 7
After-Tax Performance Is The Right Measure
Munis are held in after-tax accounts
Directly: Individual and separately managed accounts (SMA’s)
Indirectly: Mutual funds and ETF’s
Also: insurance companies and other financial institutions
Objective should be to achieve superior after-tax return
Including taxes associated with gains and losses
Performance can be enhanced by strategic sales
Tax-loss harvesting is the standard, but not the only, method
8. 8
Tax Treatment of Gain/Loss on
Sale Prior to Maturity
Depends on investor’s tax basis
Purchased at a premium: amortized value
Purchased at a discount: purchase price
Gain can have split treatment
OIDs are complicated (not discussed)
Can be short-term or long-term
For high-income individuals, short-term rate is 43.4%; long-term
rate is 23.8%
Losses need offsetting gains; otherwise carry forward
9. 9
Tax Management Opportunities
Familiar transaction: selling losers
Known as tax-loss harvesting
Short-term loss @ 43.4% can be very valuable
Selling winners (bonds purchased at a discount whose value
surged) can also be beneficial
Can you figure out why?
10. 10
‘Hold Value’ is Critical to the Sale Decision
Hold Value = PV (bond flows + tax due from current holder)
Tax is based on purchase date and price
Applicable tax rate is investor-specific
Discount rates estimated from trades of like bonds
Hold value and market price can diverge
Market price depends on tax considerations of the new buyer
It is also affected by liquidity
Bonds purchased or selling at a discount
require special attention
11. 11
Market Price and Hold Value Can Diverge
10-Year Bullets
91
92
93
94
95
96
97
98
99
100
101
2.40 2.50 2.60 2.70 2.80 2.90 3.00 3.10
Value(%Par)
Coupon (%)
Hold Value Given Above-
Par Purchase Price
Market Price
Hold Value Given
Purchase at 90
10-Yr Rate 3%
12. 12
Sale Decision Is a Two-Step Process
1. Is it beneficial?
Compare after-tax proceeds from sale to hold value
Benefit does not depend on the replacement bond, but
reinvestment in like bond maintains risk exposure
In practice, tax-driven sales are presented to retail clients as ‘swaps’
– an unnecessary source of confusion
13. 13
Calculation of Benefit from Selling a Loser
Bond Purchased at a Premium, Sold Below Par
2.50% Bond – 10 Years to Maturity
Purchase Price (2 years ago) 111.85
Holder’s Basis 110.00
Sale Price (after 0.5% spread) 93.22
Loss = – (16.78)
Tax Savings @ 23.8% 3.99
After-tax Proceeds from Sale = + 97.21
Hold Value 95.57
Net Benefit of Transaction = – 1.64
All values in percent of par
14. 14
Sale Decision Is a Two-Step Process
1. Is it beneficial?
Compare after-tax proceeds from sale to hold value
2. Do it now or wait?
Sale at a later time may be more beneficial, depending on rates
How to deal with interest rate uncertainty?
15. 15
Benefit from Selling Increases as Rates Rise
-1.0
-0.5
0.0
0.5
1.0
1.5
2.0
2.5
3.0
-75 -50 -25 0 25 50 75 100
NetBenefitfromSelling(%par)
Yield Curve Shift (bps)
Bond Purchased at Premium, Sold Above Par
Lower Prices
Current bid
price 117.20
5% bond, 10 years to maturity
Purchased 2 years ago at 125.78
Current tax basis 122.00
Higher Prices
16. 16
Introducing the Tax Option
The right to execute tax-driven trades is a tax option
Every investor owns this free option
But only astute managers know how to ‘monetize’ it
Value of tax option depends on volatility of interest rates
Interest rates affect price, which in turn affects tax benefit
17. 17
Volatility Increases Value of Tax Option
Greater Potential for Tax-Loss Harvesting
1.0
1.1
1.2
1.3
1.4
1.5
0 5 10 15 20
TaxOptionValue(%par)
Interest Rate Volatility (%)
5% bond, 10 years to maturity
Purchased 2 years ago at 125.78
Current bid price 117.20
18. 18
Tax Efficiency Signals When to Sell
Benefit should realize most of forfeited tax option value
Decision depends on risk tolerance; 90% minimum recommended
No reason for delaying at 100%
𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸𝐸 =
𝐴𝐴𝐴𝐴𝐴𝐴𝐴𝐴 𝑃𝑃𝑃𝑃𝑃𝑃𝑃𝑃 − 𝐻𝐻𝐻𝐻 𝑉𝑉𝑉𝑉𝑉
𝑇𝑇𝑇 𝑂𝑂𝑂𝑂𝑂𝑂 𝑉𝑉𝑉𝑉𝑉
19. 19
Short-Term Loss Enhances Tax Efficiency
-20
0
20
40
60
80
100
119 120 121 122 123 124
Efficiency(%)
Purchase Price (% par)
5% bond, 10 years remaining
Purchased 6 months ago at prices shown
Current sale price 117.20
10-Yr Rate 3%
Transaction Cost 0.5%
IR Volatility 20%
Wait
Sell
20. 20
Summary
Munis offer opportunities for tax-driven sales
Can generate positive after-tax cashflow
Tax option: right to execute such sales
Its value depends on market volatility and transaction cost
Tax efficiency signals when to execute
21. 21
Tax Management Today: Theory and Practice
Benefit can be considerable
Value of tax option in new long-term muni is roughly 5 points
Translates into at least 30 bps annual outperformance over
‘buy-and-hold’
But tax considerations are largely ignored by managers
Mutual funds and ETF’s report only pretax performance
Investors are responsible for taxes on capital gains
Managers of SMA’s are reluctant to advise on taxes
For individuals, transaction cost is prohibitive
22. 22
References
“Bond Valuation in Tax Denial”, Quant Forum (March 29, 2014)
“The Tax Option in Municipal Bonds,” A. Kalotay, D. Howard, Journal of Portfolio
Management, (Winter 2014)
“The Interest Rate Sensitivity of Tax-Exempt Bonds under Tax-Neutral
Valuation,” Journal of Investment Management, (First Quarter 2014)
“Optimum Tax Management of Municipal Bonds” (working paper)
“How to Take a Tax Loss and Then Profit From Obamacare”, The Bond Buyer,
(December 11, 2014)