What are tax-free municipal bonds?
They are bonds issued by the various states in our country and their political subdivisions, such as counties, cities, school districts, and local public authorities and agencies to finance various vital infrastructure needs. As an investment, municipal bonds are generally considered to provide the second highest degree of credit quality available – second only to U.S. Government obligations – due to the taxing or revenue raising power of municipal issuers. Interest on most municipal bonds is exempt, under present tax laws, from Federal income tax and generally from the income taxes of the states in which they are issued. However, a portion of the income from the Fund may be subject to Federal and state taxes, including the Alternative Minimum Tax, for certain investors.
How do the Aquila Municipal Bond Funds operate?
The Funds combine your investment with that of many other investors. They purchase and maintain a continuously managed portfolio consisting of a diverse number of tax-exempt state municipal bonds and similar type obligations having various maturities and meeting select quality standards.
What are some of the benefits of investing in a municipal bond fund?
The Fund’s professional management monitors the investments on a continuing basis and can react to changing economic and market conditions, and the varying interest rate environment. You also benefit from greater diversification and from economies of scale provided by the Fund’s overall size. Additionally, through ownership of a municipal bond fund you avoid certain administrative problems and transaction costs associated with the purchase and maintenance of individual municipal bonds.
Before investing in one of the Aquila Group of Funds, carefully read about and consider the investment objectives, risks, charges, expenses, and other information found in the Fund prospectus. The prospectus is available from your financial advisor, on this site, and when you call 800-437-1020.
Consideration should be given to the risks of investing. Investments in bonds involve certain risks including a decline in value due to rising interest rates, a real or perceived decline in credit quality of the issuer, borrower, counterparty, or collateral, adverse tax or legislative changes, court decisions, market or economic conditions. Fund performance could be more volatile than that of funds with greater geographic diversification. For certain investors, some dividends may be subject to federal and state taxes, including Alternative Minimum Tax (AMT). Please consult your professional tax advisor.
What size investment can be made in a Fund ?
The minimum initial investment in a Fund is $1,000—a far smaller amount than if you were to buy a municipal bond directly. You may also open an account by establishing an Automatic Investment Program which permits purchases of $50 or more each month. You may make any size investment you wish above the initial minimum amount. Just as important, any subsequent investment you make may be of any amount – there is no minimum. Class I and Class Y shares are available to investors only through a professional financial advisor or a financial institution. Please see the prospectus for details.
Who maintains the Funds's portfolio securities?
All securities owned by the Funds are kept in a separately segregated custody account at Bank of New York Mellon.
How often do the Funds pay dividends?
The bond fund dividends are declared daily and paid monthly. The equity fund declares and pays dividends annually, at year-end. Unless you specifically request otherwise, your dividends and distributions will be reinvested automatically for you in full and fractional shares of the Fund at the then current Net Asset Value per share, without any sales charge. You can, of course, if you wish, have any or all fund dividends or distributions paid to you by check, or electronically transferred to your personal bank account. Alternatively, you may direct all of your distributions to another one of your existing accounts in the Aquila Group of Funds.
How can I get an Aquila Fund's yield?
You may call the us toll-free at 1-800-437-1020. The latest 30-day SEC yield is available to you on any business day between 9:00 a.m. and 5:00 p.m. (Eastern Time).
What's the difference between an SEC yield and a distribution yield?
Prior to 1988, when the Securities and Exchange Commission imposed standards for the way yields must be calculated, performance figures were calculated using many different methods. The SEC implemented the standardized yield formula, which a fund must use when advertising its yield, to enable investors to compare funds on an “apples to apples” basis.
The SEC formula annualizes a fund’s yield based on a 30-day trailing period of time. It reflects a current picture of the yield based on the current interest rate environment and takes into account a bond’s yield to maturity.
The distribution yield reflects the fund dividend distributions relative to the fund price per share. The total of the per share dividend payments for a 30-day period of time is then annualized.
How can I keep track of my investment in the Funds?
Go to “Our Funds” above and click on the fund(s) you invest in for more information, including current Net Asset Value. Additionally, you will receive a statement at the end of each month, either from the Fund’s Shareholder Servicing Agent or your or your broker-dealer, as to the status of your investment. Further, any time you put money into or take money out of your account, a confirmation will be sent to you. At year end, you will receive a summary statement. In addition, an audited report on the Fund is sent to you annually, as well as an unaudited semi-annual report.
For your further convenience, if your account is maintained by the Fund’s Shareholder Servicing Agent, BNY Mellon, you may click here or call the Fund’s Shareholder Servicing Agent, toll-free at 1-800-437-1000, on any business day to get an update of your account.
Please contact your brokerage firm, or see the statement they provide to you, if your shares are held in your account with that brokerage firm.
How liquid is my investment in the Fund?
While you have ready liquidity, you should consider the Fund as a long-term investment. You may redeem all or part of your investment on any business day at the next-determined Net Asset Value of the Fund’s shares after acceptance of your redemption request. You should be aware, however, that, the securities which comprise a Fund’s portfolio vary in market price with prevailing market and economic factors, and since the Fund’s price per share is determined by the market value of the securities in the Fund’s portfolio at the time of liquidation, the per share price you receive may be more or less than what you originally paid. The prospectus outlines a number of different ways you may redeem your shares. A 1% contingent deferred sales charge (CDSC) applies to Class C Shares redeemed within the first 12 months of purchase.
Is the Fund right for me?
This is something which you must ultimately decide for yourself. The mutual funds available in the Aquila Group of Funds are intended as long-term investments seeking investment objectives as described in the Fund prospectus. Before investing in one of the Aquila Group of Funds, carefully read about and consider the investment objectives, risks, charges, expenses, and other information found in the Fund prospectus. The prospectus is available on this site, from your financial professional, and when you call 800-437-1020. You may also be interested in our brochure, A Careful Approach to Today’s Markets, which describes our Guiding Principles and the funds we offer.
How can I invest in the Fund ?
You may invest in any of the Aquila Group of Funds through your professional financial advisor or by completing the Fund‚ application. The Fund offers both Front-Payment Class Shares (Class A Shares) or Level-Payment Class Shares (Class C Shares). The maximum sales charge included in the offering price of Class A Shares varies by fund. Please see the prospectus, or fund-specific information on this site, for details. Class C Shares do not have a sales charge, but do have a contingent deferred sales charge (CDSC) of 1% if a redemption occurs within the first 12 months of purchase. Class I and Class Y shares are available to investors only through a professional financial advisor or a financial institution. Before investing, carefully read about and consider the investment objectives, risks, charges, expenses, and other information found in the Fund prospectus. The prospectus is available on this site and from your financial advisor, or by calling 800-437-1020.
Where can I find information regarding Cost Basis Reporting?
How can I get answers to any other questions I might have?
Your local financial professional should be able to help you with any questions you have. Or, you may call toll-free at 1-800-437-1020 or contact us by e-mail.