CGMU vs VCRM

CGMUACapital Group Municipal Income ETF

VCRMAVanguard Core Tax-Exempt Bond E

In short

CGMU Capital Group's answer to the muni index giants: an actively run book of roughly 1,500 bonds, benchmarked to a blend that is deliberately 15% high yield. Federally tax-exempt income, paid monthly, for 0.27% a year.

VCRM Vanguard's active answer in a mostly-index category: managers working the whole muni curve for 0.12% a year, under half the muni ETF median fee. Monthly income, exempt from federal personal income taxes.

Stated mandate

CGMU The fund seeks high current income exempt from regular federal income tax while preserving capital.

VCRM The fund seeks total return through current income exempt from federal personal income taxes and capital appreciation.

Why people hold it

• CGMU Active management, not index-tracking. Capital Group's bond desk picks the paper across roughly 1,500 positions rather than buying whatever the muni index prints.capitalgroup.com
• 0.27% a year, below the median muni bond ETF. Cheap for an active mandate, and cost matters double when the whole point is after-tax income.
• The benchmark blend, 85% high grade and 15% high yield in 1 to 17 year maturities, builds in an income tilt and stops short of the 30-year end of the curve.
• A multi-billion-dollar fund that trades actively and distributes monthly. Rare scale for an active muni ETF, and it shows up as easier entry and exit.

• VCRM Active management priced at 0.12% a year, less than half the 0.30% median for muni ETFs.
• Run by Vanguard's Fixed Income Group, with all-curve exposure to primarily high-quality investment-grade munis spread across sectors, states and credit tiers.prnewswire.com
• Pays monthly, with income the fund seeks to keep exempt from federal personal income taxes.vanguard.com
• Sticks tightly to its stated mandate and grades among the strongest implementations in its muni peer group.

Worth knowing

• CGMU Index rivals VTEB and SCMB charge three basis points. You are paying a real premium here for active security selection.
• That 15% high-yield slice in the benchmark means credit risk a pure high-grade muni fund would not carry.
• The mandate targets income exempt from regular federal income tax. State and local treatment depends on where you live and what the fund holds.capitalgroup.com

• VCRM You pay up for the manager: index peers VTEB and SCMB run at 0.03%, a quarter of VCRM's 0.12%.
• Launched in November 2024, so there is only a short record to judge the active mandate on.
• All-curve exposure puts longer maturities in the mix, so prices move with rates. And the exemption is federal: state treatment of a national muni fund depends on where you live.prnewswire.com

Full CGMU profile⁠

Full VCRM profile⁠