Municipal bonds have rallied in the past year, yet they remain inexpensive compared to Treasuries, said Julio Bonillo, Portfolio Manager for the Schroder Broad Tax-Aware Value Bond Fund. Bonillo added that he prefers dedicated revenue bonds as opposed to general obligation bonds where there may be pension liability problems like in Chicago and Puerto Rico. He said net issuance is still favorable for muni prices because refinancings are dominating the calendar. Finally, Bonillo said he has profited from holding Treasuries in his portfolio, nevertheless, he primarily has been using them as a storehouse of value and has been selling them to redeploy the capital into less pricey options.
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