New ETF looks to profit from municipal bonds

A new ETF called IR+M Tax-Aware Short Duration ETF (TAXX) has been launched by BondBloxx’s Joanna Gallegos. Gallegos believes that municipal bond portfolios offer income-generating opportunities in a high-rate environment, even if the Federal Reserve cuts interest rates. The fund’s holdings are primarily in municipal bonds, with the top five muni holdings by state being Illinois, Pennsylvania, New Jersey, New York, and Alabama. In addition to municipal bonds, the ETF also includes exposure to corporate and securitized bonds, aiming to increase after-tax total returns. The fund is described as “tax efficient” by FactSet, balancing strong after-tax income opportunities with capital preservation. The tax-equivalent yield of the portfolio is currently close to 6%. Since its launch on March 14, TAXX has seen a 0.2% decrease in value.

A new ETF in the municipal bond space called the IR+M Tax-Aware Short Duration ETF (TAXX) launched less than a month ago. Joanna Gallegos, co-founder and COO of BondBloxx, is behind the fund and sees actively managed municipal bond ETFs as an income-generating opportunity, especially in a high rate environment. TAXX holds nearly 62% municipal bonds, with its top five holdings being from Illinois, Pennsylvania, New Jersey, New York, and Alabama. The fund also includes exposure to corporate and securitized bonds for a wider opportunity to increase after-tax total returns. FactSet describes the fund as “tax efficient” and Gallegos stated that the portfolio’s tax-equivalent yield is close to 6%. TAXX has shown a 0.2% decrease since its launch date on March 14th.

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