When it comes to investing in municipal bonds, the Fidelity Intermediate Municipal Income Fund (FLTMX) has a "steadfast" approach that has served investors well, according to Morningstar. For its portfolio manager Michael Maka, that means being research driven and focused on total return. "We're really trying to build portfolios that just outperform over the long term and without trying to predict what the future holds," said Maka, who has spent two decades working in the muni market, first as a trader and now as a manager of several Fidelity funds.
Like the rest of the bond market, munis are enjoying elevated interest rates. The assets are particularly loved by wealthy investors because the income is free of federal taxes, as well as state taxes if the investor lives in the state where the bond was issued. FLTMX has a 30-day SEC yield of 3.
28% and a 5.54% tax-equivalent yield, as of Monday. It has nearly $11.
5 billion in total assets and an expense ratio of 0.36%. Meanwhile, muni bonds could see some price appreciation once the Federal Reserve starts to cut rates, which the market believes will begin in September .
Bond yields move inversely to prices. Finding opportunities Fidelity Intermediate Municipal Income Fund, as its name suggests, focuses on the middle of the yield curve — an area where bond investors have started moving in anticipation of Fed rate cuts. FLTMX has a duration — which measures a bond portfolio's sensitivity to interest rates — of 4.
89 years. Whe.