| Closed ends funds you have to buy through a broker so there
will be a commission when you buy/sell. If it's an IPO
(Initial Public Offering) you can buy it without a commission
if you can find the brokerage house which is offering it.
But you'll still pay commission when you sell.
The main thing I don't like about them is the interest is
not reinvested. With open-ended mutual funds you can
re-invest the interest in additional shares.
My personal feeling is you can do the same buy just buying
a tax-free open-ended mutual fund. Also, unless you know
what your getting into, I would stay away from long term
(20+ years) bonds right now. You can get almost as much
interest with less risk with intermediate tax-free bonds
(10 years or less). I don't think it's worth the extra
risk right now of going long. With an intermediate term
muni you get about 0.5% less interest but with much less
risk. These 10 year bonds seem to be a good trade off
between long term and short term right now.
Also note that there is huge amounts of long term municipal
bonds being issued now, so even though there is demand for them,
the supply is also high which may not push rates much lower....
I'm staying with the 10 year bonds myself... (I'm assuming
with a 6% return and lots of AA and AAA this Oppenheimer
fund is buying long term muni's)
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