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    Municipal bonds: The most overlooked opportunity for non-US investors

    Municipal bonds: The most overlooked opportunity for non-US investors

    17 September 2024 Fixed income

    The US municipal bond (munis) market represents one of the most overlooked fixed income opportunities for non-US investors, with non-US ownership of munis representing under 3% of the market.

    We believe the apparent under-utilisation of the asset class by investors from outside the US creates an underappreciated opportunity to invest in high quality fixed income assets issued by virtual monopolies that deliver services with inelastic demand.

    In this paper, we explore the benefits of allocating to US taxable munis, the most common type of muni for non-US investors, before exploring how an allocation to the asset class could impact a fixed income portfolio.

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