Exchange-traded funds (ETFs) are investment vehicles that trade like stocks, but like a mutual fund hold a bundle of securities. Municipal Bond ETFs invest primarily in municipal bonds issued by local and state government for the purpose of funding various projects.
3 Benefits of Municipal Bond ETFs:
- ETFs offer lower fees when compared to other investment funds and vehicles, such as mutual funds.
- They provide diversification in the basket of municipal bond holdings in the ETF, which lowers portfolio market risk.
- It’s easy to gain exposure to many municipal bonds with just one vehicle (ETF).
Below, we’ve provided a sample list of the major municipal bond ETFs.
|Symbol||ETF Name||Issuer||Expense Ratio|
|FMB||First Trust Managed Municipal ETF||First Trust||0.5|
|RVNU||Deutsche X-trackers Municipal Infrastructure Revenue Bond ETF||Deutsche Asset Management||0.3|
|MLN||VanEck Vectors AMT-Free Long Municipal Index ETF||VanEck||0.24|
|XMPT||VanEck Vectors CEFMunicipal Income ETF||VanEck||1.65|
|PZA||PowerShares National AMT-Free Municipal Bond Portfolio ETF||Invesco||0.28|
|ITM||VanEck Vectors AMT-Free Intermediate Municipal Index ETF||VanEck||0.24|
|GMMB||Columbia Intermediate Municipal Bond ETF||Columbia||0.42|
|VTEB||Vanguard Tax-Exempt Bond ETF||Vanguard||0.12|
|TFI||SPDR Nuveen Barclays Municipal Bond ETF||State Street SPDR||0.23|
|IBMK||iBonds Dec 2022 Term Muni Bond ETF||iShares||0.18|
Please note that ETFs may have different tax implications and liquidity than regular bonds, so speak to a professional financial advisor first.