Market Drinks Up Water Bond

A $2 billion bond sale by California’s Department of Water Resources saw strong demand from individual investors looking for additional yield in a market starved for new deals.

By late afternoon, almost half the issue—$966 million—had been sold to retail investors. Backed by rates revenue and with solid credit ratings, the bonds are seen as safer than the state’s general-obligation bonds.

“They’re apples and oranges,” said Miller Tabak Asset Management CEO Michael Pietronico.

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