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The municipal bond story

While many people purchase municipal bonds as part of their overall investing strategy, they may not know the interesting story behind municipal bonds. Learn more about this story - why municipal bonds are created, how they work, and who plays a role in the process.

All Fixed Income Lessons

Any fixed income security sold or redeemed prior to maturity may be subject to loss.

In general the bond market is volatile, and fixed income securities carry interest rate risk. (As interest rates rise, bond prices usually fall, and vice versa. This effect is usually more pronounced for longer-term securities.)  Fixed income securities also carry inflation risk, liquidity risk, call risk and credit and default risks for both issuers and counterparties. Unlike individual bonds, most bond funds do not have a maturity date, so avoiding losses caused by price volatility by holding them until maturity is not possible.

Fidelity Brokerage Services LLC, Member NYSE, SIPC, 900 Salem Street, Smithfield, RI 02917