Free Application Download: http://www.arbitrageportfolio.com/After-Tax-Equivalent-Yield-Calculator.xlsx Full Article: http://www.arbitrageportfolio.com/tax-exempt-investing-and-municipal-bonds Tax Exempt (Free)Investing Investing in tax exempt securities like municipal bonds is a very simple way to produce tax efficient returns without the complications of a corporate structure

1. Tax Exempt (Free)
Investing
Investing in tax exempt securities like municipal bonds is a very simple
way to produce tax efficient returns without the complications of a
corporate structure.
www.arbitrageportfolio.com
Page 1

2. Tax Equivalent Yield:
Tax Equivalent Yield Formula:
Yc = Ym / (1-R)
Yc: corporate after tax equivalent yield
Ym: municipal yield
R: capital gain tax rate bracket
This equation gives us the comparable effective yield between the two
investment securities.
www.arbitrageportfolio.com
Page 2

3. Tax Free Investing Calculator
www.arbitrageportfolio.com
Page 3