Municipal bonds have been a steady bet in 2021 despite all the volatility, with certain exchange traded funds (ETFs) high on momentum according to their relative strength index (RSI).
The RSI can be a helpful indicator to know if momentum is behind a certain ETF — the closer to a reading of 70, the higher the momentum. It can also indicate an oversold condition, so investors need to be aware of potential sell-offs. Likewise, it’s not an end-all-be-all when it comes to choosing a momentous fund, but rather a tool that investors can add to their toolboxes.
Fundamentally, municipal bonds have also been a strong bet in 2021. The trillion-dollar infrastructure package and the prospect of higher taxes are also propping up demand for municipal bonds.
ETF TRENDS
by BEN HERNANDEZ
DECEMBER 20, 2021