Read the Eaton Vance Market Insight of November 2010: "Willful or Wary? Why Recent Volatility May Spell a Buying Opportunity for Municipal Investors."
Also, in general muni CEFs tend to be sensitive to the long bond (30yr TBill) since the durations of their holdings also tend to be longer. I've seen estimates for individual munis that a 0.40% increase in the 30yr caused an avg 6% decrease in price (a Morningstar estimate). Have not attempted that calculation myself for the multiple holdings of a muni CEF so just throwing it out.
The same article mentioned that some added price movement from investor worries about state & local gov't stability should be expected. Volatility may be with us for a while but my own bet is that interest rates will stay low for most of 2011.
Does anyone know if PML has exposure to the alt min tax? In the annual report of 31 May 10, the report states that this fund is 97.50% free from AMT. I take that to mean that us share holders will have to make out AMT forms. Am I wrong? If you have the annual report, see page 45. Does anyone out there have ever made out AMT forms?