Sage Seizes Opportunities in the Muni Bond Market

June 10, 2020 — During the month of March, solid AAA municipal credits were trading at distressed levels as mutual funds and other institutions were forced to liquidate to raise cash for withdrawals. The municipal to Treasury yield ratio (M/T ratio) diverged from its long-term average, reaching levels not seen since 2009. At its peak, AAA municipal bonds were trading at 2,100% or 21.0x the yield of comparable Treasuries. Prudent investors with cash and rational foresight were able to take advantage of once-in-a-decade, if not lifetime, opportunities to put money to work at deeply discounted levels.