GMUB vs VTEB

GMUBAGoldman Sachs Municipal Income ETF

VTEBAVanguard Tax-Exempt Bond ETF

In short

GMUB Goldman's 2024 muni entry skips the index-hugging playbook: no declared benchmark, roughly 240 bonds chosen by the desk, 0.18% a year. Cheaper than the typical muni fund, pricier than the index giants.

VTEB Vanguard's national muni index fund, running since 2015 at three basis points, a tenth of what the typical muni ETF charges. Its benchmark screens for investment-grade bonds whose income is exempt from federal tax and the AMT.

Stated mandate

GMUB The Fund seeks substantial current income that is exempt from regular federal income tax.

VTEB VTEB seeks to track an index measuring the investment-grade segment of the U.S. municipal bond market. It uses passive sampling to approximate the index and generally invests in federally tax-exempt municipal securities.

Why people hold it

• GMUB 0.18% a year undercuts the typical muni bond fund, so the active work costs less than the category norm.
• Targets substantial current income exempt from regular federal income tax, and pays it out monthly.
• Spreads across roughly 240 municipal bonds with no declared index to shadow, leaving credit selection to the managers.
• Stands in the top quartile of a muni field running to over a hundred funds, a strong showing for a young launch.

• VTEB Three basis points a year against a 0.30% muni-ETF median. On tax-exempt bonds, where coupons are modest, that fee gap is a real slice of the payout.
• The index holds only investment-grade munis whose interest is exempt from federal income tax and the alternative minimum tax, so the income carries no AMT surprise.vanguard.com
• A multi-billion-dollar fund and one of the most heavily traded in the muni category, which tends to show up as tight bid-ask spreads. Income is paid monthly.
• It has tracked its benchmark closely and sits among the strongest implementations in a crowded muni bond peer group.

Worth knowing

• GMUB Index rivals VTEB and MUB charge single-digit basis points, so the active mandate here starts each year behind on cost.
• Thinly traded next to the muni heavyweights, which can mean wider spreads at the moment you trade.
• Launched July 2024, so the track record is short and covers only one stretch of the rate cycle.

• VTEB Federal exemption, not blanket coverage. Income can still be taxable in your home state, which is why single-state funds like NYF exist alongside it.vanguard.com
• Credit quality is investment grade, so rates are the main swing factor: when muni yields rise, bond prices and the fund's share price fall.vanguard.com
• Sampling, not full replication. The fund owns a representative slice of a very large index rather than every bond in it.vanguard.com

Full GMUB profile⁠

Full VTEB profile⁠