On Thursday, Goldman Sachs unveiled a new suite of muni income ETFs with different strategies.
Ultra-Short Returns
A short-duration strategy, the Goldman Sachs Ultra Short Municipal Income ETF (GUMI ) aims to provide strong current income exempt from regular federal income tax. With a net expense ratio of 0.16%, the fund also aims to mitigate volatility.
The wide majority of GUMI’s investments target municipal securities with interest that is exempt from federal income tax. In normal conditions, GUMI intents to maintain a half-year portfolio duration, give or take three months.
West Coast Strategy
The Goldman Sachs Dynamic Municipal Income ETF (GCAL ) offers current income that is exempt from both federal income tax and California personal income tax. This fund has a net expense ratio of 0.35%.
Principally, GCAL invests most of its assets toward muni securities from California or other states, territories, and territories of the U.S. A smaller portion of fund assets may be allocated toward junk bonds.
New York Options
Moving on to the East Coast, the Goldman Sachs Dynamic New York Municipal Income ETF (GMNY ) has a net expense ratio of 0.35%. Investors in this fund can benefit from current income that’s exempt from New York state and city personal income taxes, along with federal income tax.
GMNY invests in fixed income securities from New York, and other states and territories of the U.S. And similarly to its West Coast peer, GMNY may also add exposure to high yield bond options.
Tax-Exempt Income
Lastly, the Goldman Sachs Municipal Income ETF (GMUB ) looks to provide income that is exempt from federal income tax. This fund has a lower net expense ratio of 0.18%.
GMUB invests primarily in municipal options issued by or on behalf of the United States. The entirety of the fund’s portfolio is intended to be invested in U.S. dollar-denominated securities. However, smaller, separate portions of the fund may be invested in junk bonds or private activity bonds.
“Advisors are heavily gravitating toward fixed income ETFs right now. And many are seeking the safety and reliability of munis,” noted VettaFi Senior Industry Analyst Kirsten Chang. “This exciting new suite of products allows Goldman Sachs to tap into decades of experience and expertise to leverage an already-strong muni bond franchise.”
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