BondView

Data for municipal bond funds show the so-called smart money investors have big bets on junk-rated bonds despite the worries over Puerto Rico and pension deficits across the U.S. Perhaps fears over pension costs are overblown.

Puerto Rico’s municipal bonds have crashed just like Greek bonds did three years ago. Puerto Rico issues hundreds of different types of bonds. They shouldn’t be viewed as a homogeneous h?oard??. They have varying degrees of credit quality and risks. Some are insured. Many have become mispriced because of the company they keep and are trading at a steep discount to face value.