MUB vs PZA

MUBAiShares National Muni Bond ETF

PZABInvesco National AMT-Free Municipal Bond ETF

In short

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.

PZA Most muni ETFs hand you the whole yield curve. PZA goes long on purpose: its index only takes bonds with at least 15 years left to maturity, all screened to stay out of the alternative minimum tax. Income lands monthly.

Stated mandate

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.

PZA The fund seeks to track an index of tax-exempt municipal debt that is not subject to the alternative minimum tax.

Why people hold it

• 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

• PZA The long-end specialist. The index takes only investment-grade munis with at least 15 years to final maturity, so duration is the design choice, not a leftover.invesco.com
• Holdings are screened to be AMT-free, aimed at filers who need tax-exempt interest that does not get pulled back in by the alternative minimum tax.invesco.com
• Trading since 2007, now a multi-billion-dollar fund that changes hands actively, with tracking that has stayed tight to its benchmark.
• Pays monthly, spreads across thousands of individual bonds, and the index is rebalanced and reconstituted every month.invesco.com

Worth knowing

• 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.

• PZA At 0.28% it sits just under the typical muni ETF, but broad-market rivals VTEB and SCMB charge 0.03%. The long-maturity focus is what carries the premium.
• Long bonds swing harder when rates move, in both directions. This is the most rate-sensitive stretch of the muni market, by construction.invesco.com
• The fund samples its index instead of buying every bond in it, so the portfolio can differ modestly from the benchmark it follows.invesco.com

Full MUB profile⁠

Full PZA profile⁠