What Is the CGMU ETF? A Complete Guide to Returns, Expense Ratio, Holdings, and Alternative ETFs
The Capital Group Municipal Income ETF (CGMU) actively invests in US municipal bonds and is known for interest income exempt from federal income tax. It suits investors who weigh monthly dividends, tax benefits, and the future interest rate outlook as a core bond holding.
SubscribeWhat Is the Capital Group Municipal Income ETF?
This bond ETF actively invests in the US municipal bond market, seeking interest income that is exempt from federal income tax. It does not track a fixed index. Instead, the fund manager selects the securities.
It suits investors who want tax-advantaged interest income and aim to stabilize their portfolio with bond assets.
The ETF is managed by Capital Group using an active management approach.
How Does the Capital Group Municipal Income ETF Invest?
| Item | Details |
|---|---|
| Investment target | US municipal bonds |
| Management style | Active (security selection) |
| Rebalancing frequency | As needed (at the managers' discretion) |
| Dividend frequency | Monthly |
| Total expense ratio | 0.27% |
The portfolio is built mainly around municipal bonds exempt from federal income tax, and it aims to maximize after-tax income through diversification across credit quality, maturity, and region. Because it is actively managed, it adjusts its weightings to market conditions, unlike index-tracking funds.
- Interest income structure exempt from federal income tax
- Security and credit quality selection through active management
Capital Group Municipal Income ETF Size and Costs (AUM and Management Fees)
Assets under management (AUM) stand at $7.5B, and the total expense ratio is 0.27% per year.
Compared with passive peers among municipal bond ETFs such as VTEB and MUB, the key difference is that this fund is actively managed.
Capital Group Municipal Income ETF Performance and Trends
1-Year Price Performance
Dividend & Yield
52-Week Price RangeMunicipal bond prices fluctuate with the interest rate environment and credit spreads. Because the fund is actively managed, its performance can deviate from its benchmark, and its volatility tends to vary across market phases.
Demand from high-net-worth investors and taxable account holders seeking tax benefits tends to be steady, and during periods of interest rate volatility, fund flows across the municipal bond market tend to be affected together.
Capital Group Municipal Income ETF Pros and Cons
Its strengths are interest income exempt from federal income tax and the security selection ability that comes with active management. Its weaknesses are the management risk inherent in active funds and liquidity constraints.
💪 Key Strengths
⚠️ Points to Watch
Alternative ETFs and Related Products to the Capital Group Municipal Income ETF
Among the five comparison ETFs shown in the table, the large passive funds are VTEB and MUB, whose low fees are a strength. CMF is a regional fund focused on California municipal bonds, and HYD is a high-yield fund that seeks higher interest income but carries greater credit risk. JMUB is a similar product that also uses an active management approach. In addition, SUB is worth comparing if you want short-term municipal bond exposure, as are regional ETFs such as NYF if you need the tax benefits of a specific state.
Peer Comparison ETFs| Ticker | Name | Price | Change | AUM | Total Expense Ratio | Dividend Yield | 1Y |
|---|---|---|---|---|---|---|---|
 MUB | iShares National Muni Bond ETF | $104.18 | +0.3% | $54.3B | 0.05% | 3.28% | -3.0% |
 VTEB | Vanguard Tax-Exempt Bond ETF | $48.88 | +0.4% | $53.0B | 0.03% | 3.48% | -3.2% |
 JMUB | JPMorgan Municipal ETF | $49.09 | +0.3% | $9.0B | 0.18% | 3.49% | -3.0% |
 CMF | iShares California Muni Bond ETF | $55.80 | +0.3% | $5.4B | 0.08% | 3.02% | -3.0% |
 HYD | VanEck High Yield Muni ETF | $49.64 | +0.3% | $4.6B | 0.32% | 4.47% | -2.9% |
Top Holdings| Ticker | Name | Weight | Price | Change | Market Cap | P/E | Dividend Yield |
|---|---|---|---|---|---|---|---|
 NYT | New York Times Co | 0.02% | $70.17 | +1.1% | $11.3B | 29.3 | 1.28% |
 MAIN | Main Street Capital Corp | 0.01% | $55.26 | -1.1% | $5.2B | 11.1 | 7.52% |
 NJR | New Jersey Resources Corp | 0.00% | $53.21 | +0.2% | $5.4B | 14.7 | 3.63% |
 LVS | Las Vegas Sands Corp | 0.00% | $36.97 | -0.2% | $23.2B | 15.2 | 3.21% |
Capital Group Municipal Income ETF Investor Checkpoints
Here are the points to review before investing in CGMU. You should weigh the tax benefits against the pros and cons of active management, and also check the interest rate environment and liquidity conditions.
| Checkpoint | What to Check | Current Status |
|---|---|---|
| 💵 Expense ratio | Check the fee level, given the nature of an active bond ETF | Somewhat higher than passive funds |
| 📊 Credit diversification | Credit rating distribution of the municipal bonds held | Varies with manager selection |
| 💰 Nature of dividends | Whether the interest income receives tax benefits | Federal tax-exempt structure maintained |
| 💧 Liquidity | Daily trading value and bid-ask spread | Lower than large passive funds |
Price volatility can increase when interest rates rise and when municipal credit spreads widen, and because the fund is actively managed, its performance can deviate from its benchmark.
It is a suitable choice for investors who value tax-advantaged interest income and prefer active bond management. If a low expense ratio is your priority, passive alternatives such as VTEB and MUB are also worth considering.
SubscribeDisclaimer: This content is for informational purposes only and does not constitute investment advice. All investment responsibility lies with the investor.
This article reflects information as of July 1, 2026.
Today's 5 AI picks, all free