Tread carefully, though. Many firms maintain their own municipal-bond inventories, and they may offer brokers incentives to sell house bonds first. And don't think that comparing commissions will be easy. Most munis are sold on a markup basis, meaning that the broker charges a little higher price for the bond, thereby driving down its yield, and most brokers won't tell you how much that markup is. Be ready to pony up a good bit of cash here, too.
Some brokers use flat-fee pricing, and others work on a markup basis.
Your mortgage bond may come with a stated maturity of 30 years, but most of its borrowers will probably refinance or move well before that time is up. And even though corporates and munis also don't run in sync with Treasuries, don't expect consistency in how the price of your mortgage bond responds to interest rates. Because of the way prepayment rates can shift, mortgage interest-rate sensitivity can wax and wane a great deal. For more information on mortgage bonds, visit the Web sites of Ginnie Mae , Fannie Mae , and Freddie Mac . And for some general basics on all the bond types discussed above, stop by the Bond Market Association's Investing in Bonds Web site .