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3 Strong Buy California Muni Bond Mutual Funds to Invest in
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Investors focused on getting a tax-free stable income may consider municipal bond mutual funds or “munis.” Though munis come with lower yields than taxable bonds, they fetch better returns in high tax brackets, if we consider after-tax returns. So, municipal bonds are preferred by investors seeking a steady stream of tax-free income in a volatile market.
California municipal bond mutual funds form one of the main segments in this category. These funds invest in municipal debt obligations of the issuers from the state. These mutual funds are expected to offer the state’s investors stable income which is not only exempted from federal income tax but also from California state income tax.
Below we share with you three top-ranked California muni bond mutual funds. Each has earned a Zacks Mutual Fund Rank #1 (Strong Buy) and is expected to outperform its peers in the future. Investors can click here to see the complete list of muni bond funds.
Oppenheimer Rochester California Municipal Y (OCAYX - Free Report) invests a large chunk of its assets in muni bonds that in the opinion of counsel to the issuer of each security provide tax-free income. The fund invests heavily in California municipal securities. Oppenheimer Rochester C Municipal Y has one-year annualized returns of 5.9%.
As of August 2018, OCAYX held 446 issues, with 2.38% of its assets invested in LOS ANGELES CALIF DEPT WTR & PWR 5%.
BlackRock California Muni Opportunities Investor A (MECMX - Free Report) seeks to offer income that is free from California and federal income taxes. MECMX normally invests a huge portion of its assets in California municipal bonds, with more than 50% of its assets invested in investment-grade securities. BlackRock California Muni Opportunities Investor A has one-year annualized returns of 2.8%.
MECMX has an expense ratio of 0.79% as compared to the category average of 0.96%.
Franklin California High Yield Municipal A1 (FCAMX - Free Report) invests a large part of its assets in municipal securities, whose interest income is exempted from California personal income taxes as well as from regular federal income taxes. The fund invests almost all its assets in securities, whose income is subjected to the federal alternative minimum tax. Franklin California High Yield Municipal A1 has one-year annualized returns of 1.8%.
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3 Strong Buy California Muni Bond Mutual Funds to Invest in
Investors focused on getting a tax-free stable income may consider municipal bond mutual funds or “munis.” Though munis come with lower yields than taxable bonds, they fetch better returns in high tax brackets, if we consider after-tax returns. So, municipal bonds are preferred by investors seeking a steady stream of tax-free income in a volatile market.
California municipal bond mutual funds form one of the main segments in this category. These funds invest in municipal debt obligations of the issuers from the state. These mutual funds are expected to offer the state’s investors stable income which is not only exempted from federal income tax but also from California state income tax.
Below we share with you three top-ranked California muni bond mutual funds. Each has earned a Zacks Mutual Fund Rank #1 (Strong Buy) and is expected to outperform its peers in the future. Investors can click here to see the complete list of muni bond funds.
Oppenheimer Rochester California Municipal Y (OCAYX - Free Report) invests a large chunk of its assets in muni bonds that in the opinion of counsel to the issuer of each security provide tax-free income. The fund invests heavily in California municipal securities. Oppenheimer Rochester C Municipal Y has one-year annualized returns of 5.9%.
As of August 2018, OCAYX held 446 issues, with 2.38% of its assets invested in LOS ANGELES CALIF DEPT WTR & PWR 5%.
BlackRock California Muni Opportunities Investor A (MECMX - Free Report) seeks to offer income that is free from California and federal income taxes. MECMX normally invests a huge portion of its assets in California municipal bonds, with more than 50% of its assets invested in investment-grade securities. BlackRock California Muni Opportunities Investor A has one-year annualized returns of 2.8%.
MECMX has an expense ratio of 0.79% as compared to the category average of 0.96%.
Franklin California High Yield Municipal A1 (FCAMX - Free Report) invests a large part of its assets in municipal securities, whose interest income is exempted from California personal income taxes as well as from regular federal income taxes. The fund invests almost all its assets in securities, whose income is subjected to the federal alternative minimum tax. Franklin California High Yield Municipal A1 has one-year annualized returns of 1.8%.
John Wiley is a fund manager of FCAMX since 1993.
To view the Zacks Rank and past performance of all muni bond mutual funds, investors can click here to see the complete list of muni bond funds.
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