Skip to content

How can investors navigate a volatile rate and muni market environment?

May 1, 2017 / by Peter Hayes

Jun 6, 2017

Worried about how your municipal strategies will navigate today’s volatile conditions? Peter Hayes discusses why volatility may actually be an opportunity for flexible bond strategies to excel.

Discover more reasons why investing in municipals may make sense.

  • View transcript

    Peter Hayes
    Head of Municipal Bonds Group

    Q: How can investors navigate the rising rates environment and a generally more volatile muni market?

    We think volatility is going to be a key theme this year going forward in 2017. In fact, already in the first three months of the year, we have seen a fair amount of volatility. If you break down the month-to-month performance of the municipal market, we have seen months that have seen half a month of positive performance and half a month of negative performance. This is a good example that we are going through right now in fact.

    So the question is how you navigate that? And, we think the best way to do that is through a flexible strategy fund. We can take advantage of volatility and opportunities in number of different ways. Many investors shy away from volatility. We think volatility actually creates opportunity. The opportunity can exist in the form of yield-curve, in the form of credit, in the form of liquidity, capital structure. And flexible strategy funds have actually helped build against and navigate against rising rates through a risk mitigation strategy in the form of treasury futures.

    So we think, this is definitely the key environment, the key year to think about a flexible strategy fund to navigate against some of that volatility that we are expecting going forward.




Net Asset Value ($)


Total Returns (%)

Morningstar Rating

Peter Hayes
Head of Municipal Bonds Group
Peter Hayes, Managing Director, is Head of the Municipal Bonds Group within BlackRock's Fundamental Fixed Income Group.
Read bio