MacKay Municipal Managers™, the municipal bond team of fixed income and equity management firm MacKay Shields, LLC, recently published their top five insights for the municipal bond market in 2020.  

John Loffredo and Robert DiMella, co-heads of MacKay Municipal Managers™, commented on the firm's outlook: "While we do not believe that 2019's municipal performance will repeat, we do expect that active management has the potential to enhance performance in 2020. We believe the most prudent strategy for 2020 is security selection based on the key qualities of prospective investments. Whether evaluating investment grade or high yield municipal bonds, we look beyond a stated rating to further assess each bond's structure, liquidity profile, rate sensitivity, and credit fundamentals. Anticipating the potential for periods of higher volatility, we also place a premium on maintaining liquidity as an essential strategy for capitalizing on the resulting opportunities that may arise."

The top five insights include:

  1. Security selection and bond structure drive performance.
  2. Tactically positioning portfolios when volatility rises can reward investors
  3. Strategic underweight exposures likely to drive outperformance in the high yield municipal market.
  4. Taxable municipal refunding trend leaves the weak behind.
  5. Beware of fleeting income.

To view the full outlook, read here.  

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Media contact
Allison Scott
New York Life Insurance Company
(212) 576-4517

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This material contains the opinions of the MacKay Municipal Managers™ team of MacKay Shields LLC but not necessarily those of MacKay Shields LLC. The opinions expressed herein are subject to change without notice. This material is distributed for informational purposes only. Forecasts, estimates, and opinions contained herein should not be considered as investment advice or a recommendation of any particular security, strategy or investment product. Information contained herein has been obtained from sources believed to be reliable, but not guaranteed. Any forward-looking statements speak only as of the date they are made and MacKay Shields assumes no duty and does not undertake to update forward-looking statements. No part of this document may be reproduced in any form, or referred to in any other publication, without express written permission of MacKay Shields LLC. ©2020, MacKay Shields LLC.

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