With little fanfare and almost no public notice the markup (or spread) paid by retail investors when they buy and sell municipal bonds (trades < $1MM) has collapsed over the last 16 years. A new Municipal Securities Rulemaking Board rule (G-18) which takes effect in May, 2018 will compress these spreads further. Retail investors will find that because of lower spreads they keep more of their capital when they buy a muni bond and interest will compound at a higher rate.

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