Today, J.P. Morgan launched an actively managed ultra-short municipal bond ETF. The JPMorgan Ultra-Short Municipal ETF (JMST) is the first ultra-short muni ETF and will invest in municipal securities with an average weighted maturity of no more than two years.
JMST comes with an expense ratio of 0.18% and lists on Cboe Global Markets, the parent company of ETF.com.
The fund can invest in a wide range of municipal-issued debt. Its portfolio will include mainly investment-grade securities, but it can invest up to 10% of its portfolio in junk bonds. J.P. Morgan takes a value-oriented perspective and will target securities it expects to outperform over market cycles.
It will consider interest rate risk, credit risk, duration, liquidity, and the legal and technical structure of the transaction when evaluating securities in the process of its risk/reward analysis, according to the prospectus.
JMST has the shortest target maturity range of any existing muni ETF, something that can appeal to investors during a time of rising rates.
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