Still holding HYD and so far so good. Is is good to be diversified and hold a portion in Muni bonds.
Anyone reinvesting tax free gains or taking the cash and running?
After January when the trading action slows down they will push HYD to over $35.00 or higher a share is my bet. Traders are making to much $$ on their $$ to have it sit and only get 7.5% tax free. HYD could get a lift earlier if the Muni sector gets a lift from traders. I have noticed some news articles lately pumping the sector.
HYD is heading to my target of $35 but it could go much higher as more and more fixed income investors are getting back into the market. Even if HYD drops some the fixed income investors are still getting their dividends that are tax free. Yield now is about 6% tax free. Money markets are yielding near zero.
Be careful that wishful thinking doesn't replace common sense. As the equities market picks up and inflation becomes a concern, fixed income products could be in for a very rough time. It is just as likely that sidelines investors will get into the equities market. Today's remarkable action in HYD suggests the bubble is beginning to deflate.
HYD's total return is 25% since April, an extraordinary performance, unlikely to continue.
If you don't need the income every month, this would be a good point to re-evaluate your portfolio and think about reducing your HYD position.
Holding HYD as part of my diversification. Doing good so far and I have been pocketing the dividend and/or spend it to stimulate the economy. My cost is around $26 and very happy with it. Will hold HYD until fundamentals change and I don't know what that is and will make decision when it comes. GL