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Abstract: 

This professional development panel discusses incorporating relative value and financial modeling into the credit analysis process. The intersection between portfolio management and credit analysis has become increasingly fluid and dynamic. It is essential to evaluate relative value opportunities across credits, sectors, and asset classes, as well as to incorporate forward-looking scenario analyses into the review process. Familiarity and understanding of relative value, projections, and financial modeling have increasingly become required skillsets. The panel reviews the fundamentals to incorporate both relative value and financial modeling into analyses to make informed forward-looking evaluations. This article is based on part of a discussion by the same title presented at the 36th Annual Conference of the National Federation of Municipal Analysts held in Charleston, South Carolina, May 7–10, 2019. Nicole Byrd is vice chair of the National Federation of Municipal Analysts. John Mousseau is chief executive officer, president, and director of fixed income at Cumberland Advisors Inc. The conference proceedings are being published in a special double issue of Municipal Finance Journal, as Volume 40, Number 4 and Volume 41, Number 1.

Keywords: Portfolio management, credit analysis, de minimis bonds, advance refunding, tax loss swap

Affiliations:  1: National Federation of Municipal Analysts; 2: Cumberland Advisors, Inc..