SEC Probes Muni Funds’ High-Yield Holdings

The Securities and Exchange Commission is looking into whether municipal bond funds may have overstated the value of their high-yield holdings, The Wall Street Journal reports.

Since mid-November, municipal bond managers have had to sell high-quality holdings to keep up with record redemptions nearly $25 billion, leaving them with more high yield on their hands.

And because high-yield bonds are thinly traded, they are more difficult to value.

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