Democratic candidates take the stage together for the first time as they jockey for position in the race to take on President Trump in 2020.2020 Electionsread more
The issue over health insurance marked the first stark divide among the candidates, and sparked a heated back-and-forth between many of the candidates on stage.Politicsread more
In a strategy to draw attention away from Wednesday's Democratic debate, President Donald Trump's reelection campaign bought out YouTube's "masthead," the leading...2020 Electionsread more
Virginia Sen. Mark Warner breaks down the idea behind a bipartisan bill he introduced to provide more transparency in Big Tech.Technologyread more
The Federal Aviation Administration said on Wednesday that is has found an issue with the Boeing 737 Max that the manufacturer must address before it lifts the grounding...Airlinesread more
Tesla is working on new battery cell designs, and a way to make their own cells, with R&D teams in a lab near its car plant in Fremont, California.Technologyread more
These attacks have given the public the opportunity to examine the problems associated with ransomware, where corporations -- not obligated to disclose these attacks -- have...Technologyread more
"As a private company we don't have the tools to make the Russian government stop," Facebook CEO Mark Zuckerberg said at the Aspen Ideas Conference on Wednesday. "We can...Technologyread more
Something unusual is happening in financial markets, and it could mean more gains lie ahead for stocks, if history is any indication.Marketsread more
Underneath the impressive market rally is a trend that doesn't seem quite right, according to J.P. Morgan.Marketsread more
Wi-Fi 6 will be the next-generation wireless standard. Along with 5G, it will represent the next big shift in connectivity and data, said Irving Tan, senior vice president and...Shaping the futureread more
Some of the top-performing municipal bond funds over the past five years have held huge stakes in Puerto Rican debt. Now that Puerto Rico's governor has said the island's roughly $72 billion in debts are "not payable" and asked for U.S. bankruptcy protection for the commonwealth, investors in those funds may take a big hit.
U.S. bond funds have an $11.3 billion total exposure to Puerto Rican debt as of June 29, according to mutual fund firm research Morningstar. (Tweet This) See a list of 20 bond funds with the most exposure to Puerto Rican debt below.
Since U.S. mutual funds are only required to disclose their holdings quarterly, the list from Morningstar is a snapshot and many of these fund either could have sold, or could be selling their Puerto Rican holdings.
Yet one firm dominates Morningstar's list of funds with the highest exposure to Puerto Rican debt: OppenheimerFunds.
Sixteen of the 20 funds on Morningstar's list are members of the OppenheimerFunds' Rochester group, which describes as its strategy as venturing off "the well-worn path others follow " in tax-free municipal investing. These funds have consistently bested their muni bond peers over the past five years, but June has been brutal to them. Rochester Fund Municipals, the largest fund in the Rochester group with more than $1.3 billion in assets, had more than a quarter of its portfolio invested in Puerto Rican debt as of the end of May and experienced a 1.8 percent drop in net asset value on Monday.
"OppenheimerFunds Rochester and other creditors have offered Gov. Alejandro Garcia Padilla and Puerto Rico numerous creative and viable solutions to the current fiscal situation facing the island's public power authority. We strongly believe the commonwealth has the ability to provide essential services to its citizens, grow the economy and repay what bondholders are due.... We expect Puerto Rico to act within the tenets of the law, including the commonwealth's constitution, and are ready to defend the previously agreed to terms in each and every bond indenture," according to an OppenheimerFunds statement issued Tuesday. The company declined to comment further.
But the muni bond fund that has the biggest reported stake in Puerto Rican debt is not a part of OppenheimerFunds. That distinction goes to Franklin Double Tax-Free Income Fund, from Franklin Templeton Investments, which had more than 47 percent of its portfolio invested in the commonwealth's debt as of the end of March. That allocation is lower than it was a year ago when more than 61 percent of the fund was invested in Puerto Rican debt, according to mutual fund research company Lipper. This fund has been closed to new investors since August 2012.
A Franklin Templeton spokeswoman said that portfolio managers are analyzing an independent report on Puerto Rico's debt crisis written by Anne Krueger, a former IMF official, called "Puerto Rico – A Way Forward, " that was released Monday and is "waiting to hear more from the governor on next steps."