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. You will generally pay brokerage fees when buying or selling corporates and munis through a brokerage firm.
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.
FINRA's TRACE system provides price and trade data for corporate and agency bonds, and the MSRB's Electronic Municipal Market Access website provides trade data for municipals.
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