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New Jersey Tobacco Settlement Bonds Are Smoking: Chart of Day 

Now may be the time to sell your tobacco bonds.

The CHART OF THE DAY shows how one issue, the Tobacco Settlement Financing Corporation of New Jersey’s 5 percent bond due in 2041, has outperformed the Bond Buyer 40, a price index of long-term benchmark municipal debt, since the end of the first quarter of 2009. The New Jersey security gained 83 percent by the end of the third quarter, while the index rose 32 percent.

Long-term tobacco bonds, sold by states and municipalities to cash in on their shares of the 1998 settlement with cigarette makers, have rallied more than any other major segment of the municipal market this year, according to Bank of America Corp.’s Merrill Lynch & Co. About $37 billion of such bonds have been sold.

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