AllianceBernstein's California muni ETF lost 0.5%, less than the fund most like it
In the year since listing, through Friday, October 2, 2026, AB California Intermediate Municipal ETF returned -0.5%, a smaller loss than the -1.9% for NYLI MacKay's intermediate fund.
Key takeaways
In the year since listing, through Friday, October 2, 2026, AllianceBernstein's AB California Intermediate Municipal ETF CAM, a fund of California municipal bonds that its managers pick, returned -0.5% with the monthly payments reinvested. That was a smaller loss than the -1.9% for NYLI MacKay California Muni Intermediate ETF MMCA, an actively managed intermediate California fund, over the same closes and on the same basis. CAM aims for a duration of 3.5 to 7 years, a measure of how far the price moves when interest rates change.
The year measured here starts at the close on Monday, October 6, 2025, the day AllianceBernstein announced the listing, not on Friday, October 3, when the exchange-traded shares began. The portfolio had been a mutual fund since July 2016, the AB Intermediate California Municipal Portfolio, and about $1.09 billion came over with the conversion. The fund holds $1.16 billion now.
The share price fell from $25.02 to $24.09 over those closes, a drop of 3.7%. Reinvested payments offset 3.2 percentage points of that drop, so a 3.7% fall in the price became a 0.5% loss.
MMCA charges 0.45% a year, against 0.27% for CAM, so the fund that lost less also charged less. The cheap comparison is iShares California Muni Bond ETF CMF, which tracks an index of California municipal bonds, charges 0.08%, and returned -2.4% on the same basis. Against that fund, the extra fee was 0.19 percentage points and the lead in return was 1.9 percentage points.
On that same basis, a short-term California fund made money and a long-term one lost more. iShares Short-Term California Muni Active ETF CALI, a fund of short-maturity California municipal bonds, returned 0.7%. Invesco California AMT-Free Municipal Bond ETF PWZ, which tracks a long-term California municipal index, returned -3.8%.
From a 0.7% gain to a 3.8% loss
A cheaper intermediate index fund arrived too late for this comparison. Northern Trust California Intermediate Tax-Exempt Bond ETF TXCA, an index fund of intermediate, investment-grade California municipal bonds, began trading on Tuesday, September 22, 2026. It charges 0.06% and holds about $7.5 million.
Nearly a fifth of the 2025 income can face a second tax
AllianceBernstein's 2025 tax bulletin, covering income from a portfolio that had been an exchange-traded fund only since Friday, October 3, 2025, said 93.23% came from California issuers. For a California resident, that is the share of the income from the state's own borrowers.
The same bulletin said 19.25% was municipal interest that counts toward the federal alternative minimum tax. That second tax can reach interest the ordinary income tax leaves alone, and only people who owe it pay it.
CAM lost less than the fund built for the same job, and less than the cheap index fund beside it. One year shows the size of that lead. It cannot say whether the lead will last.
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Frequently asked questions
How much did the fund most like it lose?
NYLI MacKay California Muni Intermediate ETF returned -1.9% over the same closes and on the same basis.
Did the share price only fall 0.5%?
No: the share price fell from $25.02 to $24.09, a drop of 3.7%, and reinvested payments offset 3.2 percentage points of that drop.
Can the fund's income face a second tax?
AllianceBernstein's 2025 tax bulletin said 19.25% was municipal interest that counts toward the federal alternative minimum tax.
Does one year show the lead will last?
One year shows the size of that lead, and it cannot say whether the lead will last.
