Investors are flooding into municipal bond mutual funds and embracing their yields, which were once scorned as being far too low, according to a Bond Buyer article .

Municipal bond mutual funds that report their figures weekly posted a net inflow of $927.1 million during the week ended Aug. 18, writes Dan Seymour, citing data from Lipper FMI.

All funds, including those that report their figures monthly, have reported an average of $1.14 billion in new assets from investors the past four weeks. And the combination of $25.9 billion in new money and $22.9 billion in market gains this year has expanded the industry's assets by 10.8 percent in 2010, to a record $514.85 billion.

The article also cites Josh Gonze, who co-manages six municipal bond mutual funds for Thornburg Investment Management, and Greg Kurek, client portfolio manager in the fixed-income and currencies group at JPMorgan Asset Management.  

Edited by: Hung Tran


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