State Street's new bond ETFs cost more than iShares for the same maturity years
State Street listed MYML on September 23, 2026, at a 0.20% fee, and on October 2 its average yield to worst was 3.65%, below the index it uses as a measure.
Key takeaways
The State Street My2032 Municipal Bond ETF, MYML, charges 0.20% a year, twice the iShares fee for 2032 state and city bonds. On Friday, October 2, its average yield to worst was 3.65%, below the 4.18% on the ICE index State Street uses to measure the fund.
Yield to worst is the lowest yield those bonds would pay if the issuers use their right to repay early. The 3.65% is the portfolio's yield before the fund's fee, from that one day. The 4.18% is the average yield to worst on the ICE 2032 Maturity US Broad Municipal Index, the benchmark on the fund's page.
State Street listed MYML on Wednesday, September 23, with two other funds built to end in a named year. Each holds bonds meant to come due in that year, pays monthly, and is set to close on or about December 15 of its final year and hand back whatever is left, not a set sum. A ladder is several of those funds, one year after another, so cash comes back on a schedule. Managers pick the bonds. The index on the page is a yardstick, not a list the fund must follow.
The State Street My2036 Corporate Bond ETF, MYCP, holds company bonds aimed at 2036. The State Street My2032 High Yield Corporate Bond ETF, MYHF, holds lower-rated company bonds aimed at 2032, the kind that pay more because the borrower is more likely to miss a payment. MYML holds state and city bonds and seeks income free of regular federal income tax.
Anna Paglia, chief business officer at State Street Investment Management, said, "With our MyIncome suite, investors benefit from the bond selection and expertise of our portfolio managers across corporate, high yield, and municipal bond funds."
On that same Friday, MYHF had an average yield to worst of 8.38% before the fee, against 8.09% for its ICE index of 2032 high-yield bonds.
The iShares fees, as stated in the prospectus, are lower in every case, and the widest of those gaps is the municipal fund. Invesco charges less for company bonds and municipal bonds, and more for high yield.
The iShares iBonds 2032 Term High Yield and Income ETF, IBHL, also holds other income-paying company bonds, so that pair is not the same list as MYHF.
As of Sunday, October 4, MYCP held $7.3 million, MYHF held $4.9 million and MYML held $5.0 million. IBCB, IBHL and IBMU hold $155 million, $32 million and $28 million.
The new funds hold fewer bonds. As of Sunday, MYML held 33, and the ten largest were 42% of the fund. The iShares iBonds Dec 2032 Term Muni Bond ETF, IBMU, reported 710 on September 30. MYCP held 56, with 34% in the ten largest, against 343 in the iShares iBonds Dec 2036 Term Corporate ETF, IBCB. MYHF is closer, with 127 against 223 in IBHL. Those iShares counts are from September 30.
State Street holds fewer bonds than iShares in every sleeve
- State Street
- iShares
- Corporate 2036
- State Street 56
- iShares 343
- High yield 2032
- State Street 127
- iShares 223
- Muni 2032
- State Street 33
- iShares 710
The prospectus dated September 22 warns that in MYML's target year, "all or a very large portion" of distributions may be subject to regular federal income tax. That year is 2032, when the fund is built to close.
What the extra fee buys is the picking. On Friday's portfolio yields, the high-yield fund sits above its own index, and the municipal fund sits below.
ETFs in this story
Frequently asked questions
How much more do State Street's new bond ETFs cost than iShares?
The iShares fees are lower in every case, and the widest gap is the municipal fund, at 0.20% against 0.10%.
What yield was the new municipal fund showing?
On October 2, its average yield to worst was 3.65%, below the 4.18% on the ICE index State Street uses to measure the fund.
Do these funds have to follow the index on the page?
Managers pick the bonds, and the index on the page is a yardstick, not a list the fund must follow.
Will the municipal fund's payouts stay free of federal income tax?
The fund seeks income free of regular federal income tax, but the prospectus warns that in 2032 all or a very large portion of distributions may be subject to regular federal income tax.
