New York municipal bond mutual funds provide investors with professionally managed exposure to ౠthe New York municipal bond market. These municipal bond funds primarily invest in bonds issued by New York state, local governments, regional governments, and special purpose districts. In turn, they support public projects, such as schools, highways, and hospitals. Investors get long-term, steady capital appreciation with a low degree of volatility.

These funds may beﷺ enticing for investors in high tax brackets residing in New York who are willing to assume these risks: generally, interest earned on New York's triple🃏-exempt municipal bonds are . Let's explore the top four New York City municipal bonds,

Vanguard Ne𓆉w York Long-Term Tax-Exempt Fund Investor Shares (VNYTX)

The Vanguard New York Long-Term Tax-Exempt Fund Investor Shares was issued on April 7, 1986, by Vanguard. The fund is advised by Vanguard Fixed Income and charges an expense ratio of 0.17%. As of Sept. 30, 2024, the fund has a portfolio of 1505 investment-grade New York municipal bonds with total net assets of $5.1 billion. Since its inception, the fund achieved an average annualized return of 5.13%.

This fund normally invests at least 80% of its total net assets in debt securities whose incomes are exempt from both federal and New York state taxes. The fund does not limit the maturities of these securities and expects its dollar-weighted average maturity to be๊ between 10 and 25 years. Thꦦe fund has a(n):

• Yield to maturity of 3.7%
• Average coupon of 4.2%
• Average duration of 7.9 years
• 30-day SEC yield of 3.23%

The fund is best suited for fixed-income investors residing in New York with a long-term investment horizon seeking specialized exposure to the New York municipal 澳洲幸运5官方开奖结果体彩网:bond market. This mutual fund allows in𝓀vestors to receive federal and New York state tax-exempt income while maintaining a steady, but slow, level of capital appreciation with a low level of volatility.

Franklin New York Tax-Free Income Fund (FNYQX)

Launched on Sept. 13, 1982, by Franklin Templeton Investments, the Franklin New York Tax-Free Income Fund achieved an average annual return of 1.59% over the past 10 years, as of Sept. 30, 2024. The fund has an expense ratio of 0.75%. As of Sept. 30, 2024, the fund had total net assets of $2.81 billion with 442 bonds in its portfolio, which is managed by Franklin Advisors.

Under normal market conditions, the Franklin New York Tax-Free Income Fund invests at least 80% of its total net assets in debt securities that are exempt from federal income taxes, the federal 澳洲幸运5官方开奖结果体彩网:alternative minimum tax (AMT), and New York state taxes. Although the fund seeks to invest a substantial amount of its total net assets in tax-free securities, it may invest in debt securities subject to the federal AMT. It may also invest up to 35% of its assets in municipal securities of issuers domiciled in U.S. territories.

By sector, the fund allocates 19.99% of its portfolio in transp♊ortation, followed by special tax, utilities, and education. The fund has a(n):

• Average duration of 7.59 years
• Distribution rate of 2.86%
• 30-day standardized SEC yield of 2.90%

In terms of 澳洲幸运5官方开奖结果体彩网:modern portfolio theory (MPT), the Franklin New York Tax-Free Income Fund is best suited for fixed-income investors ꧒located in New York with a short- to medium-term investment horizon seeking to gain exposure to the New York bond market while generating tax-free income with a moderate degree of interest rate risk and credit risk. Since it provides specialized exposure to New York municipal bonds, the fund should be purchased as a sat♊ellite holding to generate tax-free income in a well-diversified portfolio.

Invesco Rochester New York Municiꦅpals Fund (RMU🐼NX)

The Rochester Fund Municipals Class A was issued on May 15, 1986, by Oppenheimer Funds, which was acquired by Invesco in 2018. It is now called the Invesco Rochester New York Municipals Fund. As of Sept. 30, 2024, the fund charges an expense ratio of 1.27%.

The Invesco Rochester New York Municipals Fund normally invests at least 80% of its total net assets in securities that are exempt from federal taxes and New York state income taxes. The fund invests primarily in investment-grade New York municipal bonds. However, the fund may also invest in debt securities of issuers outside of New York, such as U.S. territories. In 2024, the fund had a total calendar year return of 14.94%.

The Rochester Fund Municipals Class A has an effective duration of 10.7 years, which indicates it carries a high degree of interest rate risk. This high degree of interest rate risk is compensated for with the fund's high potential yield. The fund offered a 30-day standardized SEC yield of 3.49% as of Sept. 30, 2024.

Inꦰ terms of MPT, the fund is best suited for highly risk-tolerant, long-term, fixed-income investors who reside in New York, are willing to assume a moderate to high degree of credit and interest rate risk and seek to generate tax-free income.

Fidelity New York Municipal Income Fund (FTFMX)

Launched on July 10, 1984, by Fidelity Investments, the Fidelity New York Municipal Income Fund seeks to provide investors with a high level of income that is exempt from federal and New York state taxes. To achieve its investment objective, the fund normally invests at least 80% of its total net assets in investment-grade, tax-free municipal securities of issuers across many different sectors and maturities. The fund is advised by FMR and charges a low net expense ratio of 0.45%.

As of Sept. 30, 2024, the Fidelity New York Municipal Income Fund has a duration of 7.16 years, a 30-day SEC yield of 3.16%, and a tax-equivalent yield of 7.19%. Based on trailing 10-year data, the fund has generated an average annualized return of 2.42%. The fund's low-cost exposure to the New York municipal bonds market is best suited for long-term, fixed-income investors living in New York who seek steady capital appreciation and tax-free income.

The Bottom Line

Municipal bonds can help you invest your money, preserve your capital, and give you tax-free income. The bonds highlighted in this article are issued by New York State and local governments as well as the federal government. Although they may provide you with tax-free interest income, be sure you understand all the risks associated with them before you dive in with your capital. If you're unsure, speak to a financial professional about the pros and cons of investing in bond funds like these.