{"id":5593,"date":"2014-03-10T00:00:00","date_gmt":"2014-03-10T05:00:00","guid":{"rendered":"https:\/\/institutionalinvestorsecuritiesblog.blawgcloud.com\/2014\/03\/muni_bond_investors_pay_twice_1"},"modified":"2022-05-05T12:42:04","modified_gmt":"2022-05-05T17:42:04","slug":"muni-bond-investors-pay-twice-1","status":"publish","type":"post","link":"https:\/\/www.investorlawyers.com\/blog\/muni-bond-investors-pay-twice-1\/","title":{"rendered":"Muni Bond Investors Pay Twice More In Commissions than When Investing in Corporate Bonds, Reports The Journal"},"content":{"rendered":"\n

According to a study for The Wall Street Journal<\/em>, investors in municipal bonds are paying trading commissions that are around twice as high as those for corporate bonds. Individuals continue to be the largest participants in the muni bond industry, currently valued at $3.7 trillion, because these bonds are considered pretty safe and have interest payments that are not taxed. <\/p>\n

The municipal bond industry offers funding to cities, states, school districts, and hospitals. While regulators have largely overlooked municipal debt in the last two decades, lately they are scrutinizing these securities more closely. That said, unlike corporate bond and stock brokers, who are obligated to reveal market price and provide \u201cbest execution\u201d on trades to individuals to make sure they get the best prices, brokers in the muni bond industry aren’t held to the same duties, making it easier for them to buy bonds at low prices and sell them at high ones. <\/p>\n

This can leave many investors vulnerable to fees and pricing that they should be protected from. For example, The Journal<\/em> cites an example of one Massachusetts man who sold bonds promising a 5% yearly interest from his home state in two lots at $100K each in July 2013. The next day, he sold the same amount of bonds to investor at $1060\/bond\u2014making about $112,000. Municipal Securities Rulemaking Board records show that for that month, brokers in Massachusetts sold $1 million in state bonds to investors with a 3% average markup than what they actually paid\u2014that\u2019s a $30,000 profit. <\/p>\n

Continue Reading \u203a<\/a><\/div>\n","protected":false},"excerpt":{"rendered":"

According to a study for The Wall Street Journal, investors in municipal bonds are paying trading commissions that are around twice as high as those for corporate bonds. Individuals continue to be the largest participants in the muni bond industry, currently valued at $3.7 trillion, because these bonds are considered pretty safe and have interest […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"jetpack_post_was_ever_published":false,"footnotes":""},"categories":[3922],"tags":[],"class_list":["post-5593","post","type-post","status-publish","format-standard","hentry","category-municipal-bonds"],"yoast_head":"\nMuni Bond Investors Pay Twice More In Commissions than When Investing in Corporate Bonds, Reports The Journal — Investor Lawyers Blog — March 10, 2014<\/title>\n<meta name=\"description\" content=\"According to a study for The Wall Street Journal, investors in municipal bonds are paying trading commissions that are around twice as high as those for — March 10, 2014\" \/>\n<meta name=\"robots\" content=\"index, follow, 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