High yield municipal bonds hold a special allure for many investors thanks to the high levels of tax-free income they have the potential to deliver. These securities are designed for investors who understand the risks of an aggressive, yield-driven strategy.
Oppenheimer Rochester® High Yield Municipal Fund has a long history of generating above-average, tax-free yields, and has no limit on the amount of below-investment-grade securities it may hold. The Fund is also not limited to any maturity range, giving the portfolio managers the broadest investment discretion of all Oppenheimer Rochester municipal bond funds.
In addition, its portfolio currently includes over 1,000 holdings from about 600 issuers, an approach that’s aimed at reducing the overall risk of owning speculative, high yield securities and can help generate competitive levels of tax-free, yield-driven total return.
Follow @RochesterFunds for more about Oppenheimer Rochester funds.
Fixed income investing entails credit and interest rate risks. Interest rate risk is the risk that rising interest rates, or an expectation of rising interest rates in the near future, will cause the values of a fund’s investments to decline. Risks associated with rising interest rates are heightened given that rates in the U.S. are at, or near, historic lows. When interest rates rise, bond prices fall and a fund’s share price can fall. Municipal bonds are subject to default on income and principal payments. Monthly distribution payments are not guaranteed.
Below-investment grade (“high yield” or “junk”) bonds are more at risk of default and are subject to liquidity risk. Under certain market conditions, some unrated securities may trade less actively than rated securities. Our funds can have a relatively high portion of their portfolio holdings in particular segments of the municipal securities market, such as tobacco bonds or real-estate-related securities. They may also invest substantially in municipal securities within a single state or related to similar type projects, which can increase volatility and exposure to regional issues. Funds may also invest substantially in Puerto Rico and other U.S. territories, commonwealths and possessions, and could be exposed to their local political and economic conditions. Deterioration of the Puerto Rican economy could have an adverse impact on Puerto Rican bonds and the performance of the Rochester municipal funds that hold them.