MUB ETF

The iShares National Muni Bond ETF is poised for strong performance due to its high duration and expected rate cuts by the Fed. Municipal bond issuances are likely to increase, but the overall duration effect from falling rates will be favorable for MUB. MUB has minimal credit risk, with most issuers rated around AA, and offers a low expense ratio of 0.05%.

iShares National Muni Bond ETF offers tax-free municipal bond exposure with $37.6 billion in assets under management and a low expense ratio of 0.05%. The ETF has a 30-day SEC yield of 3.49% and potential for capital gains, despite lower one-year and five-year performance numbers. Reasons to consider buying MUB include potential tax increases, expiration of Trump tax cuts, late economic cycle, and Federal Reserve projections.

States can't rely on affordability alone to help drive an influx of newcomers from higher-cost states to boost their tax revenues and overall finances.

iShares National Muni Bond ETF tracks the muni bond market with big exposure to California and New York. The maturity walls in 2024 and 2025 may impact the economy and trigger the economic scenario that the Fed likely foresees to reduce rates. MUB will benefit on that front, but credit rating issues in California and New York are something that we'd prefer to avoid, as California could have problems one day.

MUB is the largest municipal bond ETF but has a low dividend yield of 2.6%. T-bills and investment-grade bonds may offer higher after-tax yields than MUB for most investors. High-yield municipal bond ETFs like HYEM offer much more compelling after-tax yields as well.

iShares National Muni Bond ETF is an interesting fund for investors to consider positioning into government debt, particularly muni bonds. The MUB ETF provides broad access to a wide range of municipal bonds, offering diversification across various states. MUB's investment-grade credit ratings and stability make it a resilient contender in the face of a broader credit event.

There's a crop of outsized dividends out there that are absurdly underpriced—I'm talking 14%-off discounts here. And our opportunity to pounce has arrived.

The iShares National Muni Bond ETF offers investors an unleveraged and multi-state exposure to generate tax-free income. As rate hikes started aggressively in 2022, leveraged options became less attractive, putting passive ETFs back on the radar. For those who want a lower risk, lower reward option while protecting against upcoming equity volatility, MUB is a decent bet.