FMUN vs MUB

FMUNAFidelity Systematic Municipal Bond Index ETF

MUBAiShares National Muni Bond ETF

In short

FMUN Fidelity's muni index fund runs on its own rules-based benchmark and charges 0.05% a year, a fraction of what the typical muni fund costs. Roughly 1,200 bonds, monthly payouts, all pointed at income the federal government doesn't tax.

MUB Municipal bonds, indexed and cheap. Since 2007, MUB has packaged investment-grade national munis into tax-exempt monthly income for five basis points a year, and it sits among the deepest pools in the muni-ETF aisle.

Stated mandate

FMUN The fund seeks high current income that is exempt from federal income tax. It normally invests at least 80% of assets in municipal securities whose interest is federally tax-exempt.

MUB The fund seeks to track an index of investment-grade U.S. municipal bonds, providing diversified exposure to the national municipal-bond market and tax-exempt income.

Why people hold it

• FMUN 0.05% a year against a roughly 0.30% median for muni bond funds. On tax-exempt income, that gap is the part you keep.
• Roughly 1,200 municipal bonds, so no single issuer or project carries the portfolio.
• Pays monthly, with at least 80% of assets in municipal securities whose interest is exempt from federal income tax.
• One of the stronger builds in the muni ETF group: passive, broad, and squarely inside its stated mandate.

• MUB 0.05% a year against a muni-ETF median near 0.30%. In a category built on modest, tax-exempt yields, that fee gap is real money left in the fund.
• The benchmark is AMT-free: the ICE AMT-Free US National Municipal Index screens out munis whose interest can be pulled into the alternative minimum tax.ishares.com
• Tracks its index closely, one of the tighter jobs in its peer group, and distributes monthly. A multi-billion-dollar fund that trades actively.
• Broad investment-grade exposure across the national muni market, spread over thousands of issuers rather than one state's budget.ishares.com

Worth knowing

• FMUN Thinly traded and modest in size next to the category's giants, so bid-ask spreads can run wider.
• The benchmark is Fidelity's own Systematic U.S. Municipal Bond Index, not a licensed outside yardstick.fidelity.com
• Muni prices move with interest rates, and the tax break targeted here is federal. State-specific relief is a different product, like NYF for New York.

• MUB Two rivals undercut it: VTEB and SCMB both run 0.03%. A two-basis-point gap is small, but it is a gap.
• A bond fund with no maturity date to hold to. Share prices move with interest rates and muni credit conditions, both directions.
• National by design, so no single-state tilt and no in-state tax angle. iShares runs state-specific muni funds such as NYF for that job.

Full FMUN profile⁠

Full MUB profile⁠