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Tuesday, November 6, 2018

MANAGING DIRECTOR:
Scott Carrithers
 
PORTFOLIO SALES AND SERVICE:
Steve Panknin • George Morris • Jeff Goble • Chris Thompson • Sean Doherty
Kevin Doyle • Lonnie Harris •  Mark Tranckino • Robert Schuyler • Tom Toburen • Josh Kiefer
 Nicole Burczyk • Kelley Frye • Natalie Regan • Aaron Stoffer • Chuck Honeywell • Gus Koppen

US Treasury Market
Date 1 mo 3 mo 6 mo 1 yr 2 yr 3 yr 5 yr 7 yr 10 yr 20 yr 30 yr
10/30/18 2.21 2.33 2.48 2.66 2.84 2.90 2.94 3.03 3.12 3.26 3.36
10/31/18 2.20 2.34 2.49 2.69 2.87 2.93 2.98 3.07 3.15 3.30 3.39
11/1/18 2.21 2.32 2.49 2.67 2.84 2.91 2.96 3.06 3.14 3.29 3.38
11/2/18 2.19 2.33 2.50 2.70 2.91 2.98 3.04 3.13 3.22 3.37 3.46
11/5/18 2.20 2.36 2.51 2.71 2.91 2.99 3.03 3.12 3.20 3.34 3.43
                                                                                                                                       Source: U.S. Department of the Treasury, as of 11/5/2018

MUNICIPAL YIELD CURVE OVER THE LAST THREE YEARS

We know, in general, what has happened to the taxable (UST) yields since the Fed started raising short term rates.  The chart below illustrates the following:
 
           12/01/15 - Start of Fed Raising Federal Funds Rate
 
           12/01/16 - Start of Fed Kicking Into Raising Gear
 
           11/01/18 - Present


Source:  Bloomberg 11/06/18


BUT:  What have tax free yields done during the same periods? 



Source:  Bloomberg 11/06/18

Yields on taxables (UST) and AAA municipals have gone up, but not in complete tandem.  When should one buy out on the municipal curve?  Was it a mistake to go longer “too early"?  
 
Tomorrow we will discuss these and other investment strategy topics.

                                                                                                                                                                                                                                                     


This information is intended for institutional investors only. The material provided in this document/presentation is for informational purposes only and is intended solely for private use. Past performance is not indicative of future results. This material is not intended as an offer or solicitation for the purchase or sale of any financial instruments.

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