No. of Recommendations: 3
Take a look at the 12 mo price chart for a closed end bond fund like NQS (Nuveen Select Municipals traded NYSE)--

The shares pay monthly interest at essentially a fixed rate (it varies by pennies per year over time). Hence, the share price translates directly to changes in yield.

The chart shows that right after the fed announces an increase in interest rates, the share price drops, but then investors steadily bid the value back up to higher levels. Hence, rates rise sharply and then slowly decline.

The analysis is simply explaining that NAVs have increased, and bond traders have had chances to make money trading bonds. The fact that interest rates have such a major effect on the total returns of bond funds makes it an iffy measure of fund management. With stock funds, total return indicates solid management. But for bond funds, total return this year does not predict the future--especially when you know what the Fed has planned for interest rates.

These are uncertain times for bonds. Risk is higher than ususal due to uncertainty. Best is to diversify or park your funds in CDs and wait for a more settled environment.
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