Top Performing Municipal Bond Mutual Funds of 2011

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This article will look into the Top Performing Municipal Bond Mutual Funds of 2011. Among the best performing funds are: Eaton Vance Tax-Advantaged Bond Strategy Intermediate Term A, New Hampshire Municipal, Dupree Taxable Municipal Bond, Oppenheimer AMT-Free Municipals A, etc.

Top Performer Muni Bond Funds 2011
Best of the categories

Municipal bond funds were one of the dislike classes of mutual funds for 2011. Meredith Whitney is one of the well known analyst who predicted the economic crisis on 2008. On December 2010, Whitney said there will be hundreds of municipal bonds goes default on 2011. However, 2011 has passed; municipal bond funds are not only recovered. They are one of the top bond funds which outperformed other fund’s categories such as international stock funds and US stock funds.

As we know, Municipal bond funds are part of fixed income funds or bond funds. Bond funds itself can be categorized into two such as taxable bond funds (government bond, sovereign bond, high yield bond, etc), and municipal bond funds. Municipal bond funds are also known as non-taxable bond funds. These Muni bond funds invest in variety of municipal debts that are tax exempt from federal tax rate.

Top Performers

From this article, you will find different categories of top performer Muni bond funds such as Muni National Intermediate, Muni National Long, Muni Short, and High Yield Muni. More details about each category can be found below. These tax free bond funds may have sales load, higher expense ratio, and part of actively managed fund. Please check the fund’s website or prospectus for additional details. Previously, I may have reviewed some of these top performers.

Muni National Intermediate

The intermediate term national municipal bond funds invest mainly in diversified portfolio of municipal obligations with investment grade rating. These debts are tax fee from federal income tax. The portfolio duration should be around 5-10 years.

The Top Intermediate Term National Municipal Bond Funds of 2011 are:
Eaton Vance funds
  1. Eaton Vance Tax-Advantaged Bond Strategies Intermediate Term (EITAX)
    • 1.34% yield, sales load of 2.25%, 0.95% expense ratio 
  2. Managers AMG GW&K Municipal Bond Fund Investor Class (GWMTX)
    • $63 million total assets, $2,000 minimum to invest, no sales load
  3. TIAA-CREF Tax-Exempt Bond Retail (TIXRX)
    • 4 stars rating, dividend yield of 3.09%, no sales load
  4. First Investors Tax-Exempt II A (EIITX)
    • yield of 3.72%, expense ratio of 1.01%, high sales load of 5.75%
  5. ActivePassive Intermediate Muni Bond A (APMUX)
    • 5.75% sales load, 13% turnover rate, $1,000 min. to invest

NoFund NameSymbol1 Year Return3 Year Return5 Year Return10 Year ReturnExpense Ratio
1
Eaton Vance TxAdvtg Bd Strat IntermTrm A
EITAX
12.86%
-
-
-
0.95%
2
Managers AMG GW&K Muni Bd Inv
GWMTX
12.16%
-
-
-
0.75%
3
TIAA-CREF Tax-Exempt Bond Retail
TIXRX
11.89%
8.45%
5.32%
-
0.55%
4
First Investors Tx-Ex II A
EIITX
11.76%
8.66%
5.42%
5.71%
1.06%
5
ActivePassive Intermediate Muni Bond A
APMUX
11.52%
6.64%
-
-
1.12%

Muni National Long

This class of municipal bond funds invests most of its assets in investment grade quality of municipal bonds. It typically has an average maturity of 10-30 years. The yield of these long term bond funds is higher than intermediate term municipal bond and short term muni bond.

The Best Performer Long Term National Municipal Bond Funds of 2011 are:
Dupree mutual funds
  1. Dupree Taxable Municipal Bond (DUTMX)
    • 4.99% dividend yield, 0.49% expense fee, $100 minimum initial investment
  2. Eaton Vance Tax-Advantaged Bond Strategies Long Term A (EALTX)
    • 4.75% sales load, 200% turnover rate, 0.95% expense ratio
  3. Nuveen All-American Municipal Bond A (FLAAX)
    • 4 stars rating, yield of 4.63%, $3,000 minimum investment
  4. Lord Abbett AMT Free Municipal Bond A (LATAX)
    • 55% turnover rate, 2.25% sales load, 4.54% yield
  5. Legg Mason WA Managed Municipals A (SHMMX)
    • sales load of 4.25%, 4 stars rating, $1,000  initial investment

NoFund NameTicker1 Year Return3 Year Return5 Year Return10 Year ReturnExpense Ratio
1
Dupree Taxable Municipal Bond
DUTMX
18.80%
-
-
-
0.76%
2
Eaton Vance Tx-Advntgd Bd Strat Lg Trm A
EALTX
17.19%
-
-
-
0.95%
3
Nuveen All-American Municipal Bond A
FLAAX
12.95%
13.41%
5.09%
5.22%
0.78%
4
Lord Abbett AMT Free Municipal Bond A
LATAX
12.91%
-
-
-
0.50%
5
Legg Mason WA Managed Municipals A
SHMMX
12.90%
11.72%
5.66%
5.34%
0.64%

Best Diversified National Municipal Bond Mutual Funds 2012

Muni Short

This short term municipal bond fund invests mainly in short duration muni debt obligations with investment grade rating. The average duration of this fund is typically in the range of 3-5 years. The yield of this fund is also lower than the previous two muni bond funds.

The Top Short Term Municipal Bond Funds of 2011 are:
Integrity Viking Funds
  1. New Hampshire Municipal (NHMUX)
    • New Hampshire muni bond, 3 stars rating, 4.25% sales load, part of Integrity Viking fund
  2. AllianceBernstein CA Municipal (SNCAX)
    • California municipal bond, no sales load, 5 stars rating
  3. AllianceBernstein Intermediate CA Municipal A (AICAX)
    • 4 stars rating, california muni bond, 0.88% expense ratio
  4. AllianceBernstein Diversified Municipal (SNDPX)
    • no sales load, 5 stars rating, 2.96% yield
  5. AllianceBernstein Intermediate Diversified Municipal A (AIDAX)
    • 3 stars rating, $2,500 initial min investment

NoFund NameSymbol1 Year Return3 Year Return5 Year Return10 Year ReturnExpense Ratio
1
New Hampshire Municipal
NHMUX
8.08%
5.65%
4.16%
3.57%
1.16%
2
AllianceBern CA Municipal
SNCAX
7.36%
5.78%
4.55%
3.95%
0.63%
3
AllianceBern Interm CA Muni A
AICAX
7.07%
5.50%
4.26%
3.68%
0.87%
4
AllianceBern Diversified Municipal
SNDPX
7.02%
5.55%
4.63%
4.11%
0.56%
5
AllianceBern Interm Divers Muni A
AIDAX
6.76%
5.26%
4.34%
3.83%
0.79%

Note: Some of these bond funds may include single state municipal bond only (i.e. not consist of diversified national municipal bond)

High Yield Muni

These high yield municipal bond funds invest primarily in non-investment grade municipal debts. These funds also have higher yield than previous investment grade muni bond funds. This high yield muni bond fund is also known as junk muni bond fund. The yield is also tax exempt from federal income tax.

The Top High Yield Municipal Bond Funds of 2011 include:
Oppenheimer Funds
  1. Oppenheimer AMT-Free Municipals A (OPTAX)
    • 4.75% sales load, 6.29% yield, 2 stars rating
  2. Managers AMG GW&K Municipal Enhanced Yield Inv (GWMNX)
    • 3 stars rating, total assets of $146 million 
  3. AllianceBernstein High Income Municipal A (ABTHX)
    • 5.2% yield, 3% sales load, no rating
  4. Spirit of America High Yield Tax Free Bond A (SOAMX)
    • expense ratio fee of 0.90%, 5.05% yield, 4.75% sales load
  5. Thornburg Strategic Municipal Income A (TSSAX)
    • $122 million assets, 1.25% expense fee, $5,000 minimum investment

NoFund NameTicker1 Year Return3 Year Return5 Year Return10 Year ReturnExpense Ratio
1
Oppenheimer AMT-Free Municipals A
OPTAX
16.40%
18.54%
-2.43%
2.62%
0.95%
2
Managers AMG GW&K Muni Enhanced Yld Inv
GWMNX
13.48%
17.33%
2.87%
-
1.12%
3
AllianceBern High Income Municipal A
ABTHX
12.92%
-
-
-
0.80%
4
Spirit of America High Yield T/F Bond A
SOAMX
12.41%
14.62%
-
-
0.90%
5
Thornburg Strategic Municipal Income A
TSSAX
12.40%
-
-
-
1.25%

Disclosure: No Position

Other Top Performer Mutual Funds of 2011:

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