Buying and Selling Corporate and Municipal Bonds |
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Like other types of bonds, corporate and municipal bonds may be purchased, like stock, through a broker. Investors may either buy the bond at issue or in the secondary market. You buy a bond at issue through full-service, discount, or online brokers as well as through investment and commercial banks. Once new-issue bonds have been priced and sold, they begin trading on the secondary market, where buying and selling is also handled by a broker. When buying or selling corporates and munis through a brokerage firm, you will generally pay brokerage fees.
When secondary trading begins, most corporate and municipal bonds sell on the over-the-counter (OTC) market. Some bonds are traded in smaller quantities on the facilities of the New York Stock Exchange (NYSE) and the American Stock Exchange (Amex), and a few trade on The NASDAQ Stock Market.
Real-time trade reporting systems such as FINRA's TRACE system and the MSRB's Real-Time Transaction Reporting System now provide price and trade data for corporates and municipals.
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