STAX vs TAXS

STAXCNomura Tax-Free USA Short Term ETF

TAXSANorthern Trust Short-Term Tax-Exempt Bond ETF

In short

STAX Actively managed munis at the short end of the curve: federally tax-free income paid monthly, with capital preservation written into the mandate. A small, young fund in a category ruled by giant index trackers.

TAXS Northern Trust's muni index fund keeps every bond under five years to maturity and charges 0.05%, a fraction of the typical muni ETF fee. Roughly 1,700 federally tax-exempt bonds, none of them AMT bonds, with interest paid monthly.

Stated mandate

STAX The fund seeks current interest income exempt from federal income tax while attempting to preserve capital through investments in short-term municipal obligations.

TAXS The fund seeks to track, before fees and expenses, the price and yield performance of the ICE Short-term Focused Municipal Bond Index. It is designed for tax-exempt income through passively managed, investment-grade municipal bonds with short-term maturities.

Why people hold it

• STAX Active, not indexed: a manager picks the short-term municipal bonds, chasing income exempt from federal tax while attempting to preserve capital.
• Pays monthly, so the tax-exempt income shows up on a regular cadence rather than quarterly.
• 0.29% a year, roughly what the typical muni bond ETF charges, and that buys an active manager rather than an index rulebook.

• TAXS 0.05% a year sits at the low end of the muni aisle, where the typical fund charges several times that, and matches the fee on MUB, the category's iShares heavyweight.
• Index rules admit only investment-grade bonds with under five years left to final maturity, so the portfolio skips the long-end price swings that define all-maturity muni funds.flexshares.com
• About 1,700 bonds, all exempt from federal tax and screened to exclude alternative minimum tax paper, with income distributed monthly rather than accrued.flexshares.com
• Passive, sampled, and run by Northern Trust's municipal desk, which has managed muni portfolios for more than 30 years. The index does the picking, not a manager's hunch.flexshares.comnortherntrust.com

Worth knowing

• STAX Index beta is far cheaper: VTEB charges 0.03% and MUB 0.05%, versus 0.29% here. They track broad muni benchmarks across the maturity curve instead of trading actively.
• A small fund that trades thinly, which can widen the gap between bid and ask at the moment you place an order.
• Launched in December 2023, so there is limited history behind the manager's approach compared with long-running muni funds.

• TAXS It launched in 2025 and trades lightly next to muni mainstays like VTEB and MUB, so spreads can run wider and the track record is short.
• Federally tax-exempt is not tax-free. That interest can still be taxed by your state and city.flexshares.com
• Sub-five-year munis generally carry lower yields than longer maturity portfolios. That is the other side of the milder rate sensitivity.flexshares.com

Full STAX profile⁠

Full TAXS profile⁠