Western Asset Municipal High Income Fund Inc. (NYSE: MHF) is a diversified, closed-end management investment company that seeks to provide a high level of tax-exempt current income by primarily investing in municipal securities. The fund’s portfolio is managed by Western Asset Management Company, a leading fixed-income specialist with decades of experience in credit analysis and interest rate management. MHF aims to deliver consistent income through a combination of high-yield and investment-grade municipal bonds, using derivatives selectively to enhance yields and manage duration.
The fund’s primary holdings include general obligation and revenue bonds issued by states, municipalities and municipal authorities across the United States. MHF focuses on opportunities in sectors such as transportation, education, healthcare and utilities, while maintaining an emphasis on credit quality and diversification. Under normal market conditions, at least 80% of the portfolio is invested in tax-exempt municipal securities, with a portion allocated to unrated or below-investment-grade bonds to capture incremental yield.
Since its inception in 2005, Western Asset Municipal High Income Fund has employed a disciplined, research-driven approach to identify value in both primary and secondary markets. The fund’s team conducts in-depth credit analysis, assessing issuer fundamentals, revenue pledges and legal covenants to position the portfolio for potential capital appreciation as well as current income. Interest rate outlook and sector rotation decisions are guided by Western Asset’s global macroeconomic research capabilities.
Governed by an independent board of directors, MHF benefits from the operational support and compliance infrastructure of Western Asset Management. The fund distributes income monthly to shareholders and pursues a managed leverage strategy to enhance returns. Through its focus on high-income municipal securities, Western Asset Municipal High Income Fund strives to offer investors a tax-efficient source of income within a closed-end fund structure.
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