What Is A Municipal Bond?



Next video:
Loading the player...

Municipal bonds, often called munis, are considered a debt instrument because when the investor purchases one, he or she is essentially loaning funds to the authority that issued it. In exchange, the authority promises to pay interest, called the coupon rate, during the years prior to maturity, at which point it repays the bond’s par value.

Related Articles
  1. ETFs & Mutual Funds

    How to Find the Best Bets in Muni Bonds

    Approach investing in municipal bonds the same as you would investing in stocks.
  2. Managing Wealth

    20 Investments: Municipal Bonds

    What Is It? Municipal bonds, or "munis" for short, are debt securities issued by a state, municipality or county to finance its capital expenditures. Such expenditures might include the construction ...
  3. ETFs & Mutual Funds

    Why You Should Invest In Municipal Bond ETFs

    These versatile instruments have become popular with investors in higher tax brackets and fill a specific niche in the wide selection of fixed-income offerings.
  4. ETFs & Mutual Funds

    Why Muni Bonds and Bond Funds are Perfect Together

    Municipal bonds and bond funds differ in several ways, which is partly why they complement each other well.
  5. ETFs & Mutual Funds

    The 6 Most Liquid Muni Bond ETFs (MUB,SHM,TFI,ITM)

    Looking for safety in an uncertain world? Consider these liquid muni bond ETFs.
  6. ETFs & Mutual Funds

    The Stealth Wealth In Municipal Bonds

    For a few municipal bond ETFs the present risk within muni markets might actually be a blessing in disguise.
  7. Managing Wealth

    Muni Bonds, Taxable Bonds or CDs: Which is Best?

    Here's how to tell if municipal bonds are a better investment than taxable bonds or CDs.
  8. Investing

    Should You Consider Muni Bonds?

    Municipal bonds come in two types. General obligation bonds repay their holders through taxes. They often have low interest rates, but they’re safe.
  9. Markets

    Municipalities Free Up Cash With Chapter 9

    Find out what happens to municipalities when they need money, but have no other option than bankruptcy.
  10. Managing Wealth

    How to Diversify with Muni Bond ETFs

    Thinking of diversifying with bonds? Consider these muni bond ETFs.
Hot Definitions
  1. Brazil, Russia, India And China - BRIC

    An acronym for the economies of Brazil, Russia, India and China combined. It has been speculated that by 2050 these four ...
  2. Brexit

    The Brexit, an abbreviation of "British exit" that mirrors the term Grexit, refers to the possibility of Britain's withdrawal ...
  3. Underweight

    1. A situation where a portfolio does not hold a sufficient amount of a particular security when compared to the security's ...
  4. Russell 3000 Index

    A market capitalization weighted equity index maintained by the Russell Investment Group that seeks to be a benchmark of ...
  5. Enterprise Value (EV)

    A measure of a company's value, often used as an alternative to straightforward market capitalization. Enterprise value is ...
  6. Security

    A financial instrument that represents an ownership position in a publicly-traded corporation (stock), a creditor relationship ...
Trading Center