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You wrote, I'm starting to explore bond investing. I have a Fidelity account and have started looking for CA GO's. Fidelity's pickings are slim. I find only 3 medium term bonds (2018 maturity) which are currently unattractive.

Is this a function of the thin pickings in the bond market right now, or is it a function of Fidelity not having a good selection?

What brokers are best for bonds or are they all about the same? And if you have any other pointers for a new bond investor, I'm all ears.

I have never found Fidelity's selection of available bonds wanting; but I've never used it to search for munis. Did you actually do your screen on Sunday?

I have to admit, I'm still a novice when it comes to muni bonds - I've yet to purchase an individual muni. But I assume the muni markets are similar to the corporate bond markets in that they really consist of a bunch of separate bond trading desks that may or may not have inventory available. (There is no concept of market makers that attempt to create an orderly and regular market for listed securities.) What's more, brokers can only report what the bond desks are telling them is available and most bond desks remove their listings at the end of the market day. In that respect the bond market is completely unlike the stock market - if no desk is currently listing a bond, the bond won't show up in any screens with your broker. It doesn't mean the bond doesn't exist - it only means no desk is currently offering it to retail investors.

If you did your bond screen after market hours (or on Sunday when you posted) you probably got a very limited selection of bonds because a number of desks had withdrawn their listings at the close of the previous market day. Today is Columbus Day, which is a bank holiday. The bond markets tend to observe bank holidays, so a screen today probably won't do you any good either.

In fact, this is one of the frustrating aspects of today's bond market - it means that you have to screen for purchases during normal business hours because that's the only time you can know what's really available for purchase. That can be difficult if not completely problematic for most people. I actually bought part of my current corporate bond holdings while I was spending a lot of time in South Korea. That made it practical for me to search bond listings, do research and execute a purchase because the bond market was open when I was not working. It's a lot harder for me to do the same today and it is part of the reason I hold preferred stocks as part of my portfolio. It is also part of why I never bought munis when the muni market was running scared earlier this year.

- Joel
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