General obligation bonds, like most municipal bonds, are typically sold in denominations of $5,000. While it is sometimes possible to buy directly from the municipality that issues them, most GO bonds are purchased on the secondary market. If you buy through secondary dealers such as brokers, you may be required to make a minimum purchase of from $10,000 to $25,000 or more.
For those who want the benefits of GO bonds without the high purchase prices, there are several opportunities to buy into pools of GO bonds. A number of mutual fund companies offer shares in managed open-end or closed-end municipal security funds. Another alternative is a unit investment trust, an unmanaged pool of GO bonds. These pooled funds give investors a chance to participate in a diversified portfolio of municipal bonds without the need to lay out thousands of dollars initially. A typical minimum purchase for these pooled investments is $1,000.
Community Resources Financed by General Obligation Bonds >>