Barclays Global Investments are the pioneers for the first municipal bond exchange traded fund (ETF). They are off to leading another segment of the industry. The iShares S&P National Municipal Bond Fund will track the S&P National Municipal Bond Index, an index of state and local municipal bonds with investment grade ratings of BBB or better. Matt Hougan for Seeking Alpha reports the ticker symbol, expense ratio and listing site are all still up in the air, as BGI has just recently filed with the SEC.
The muni market is large and varied, with an estimated $2.3 trillion in outstanding bonds spread across more than 2 million separate offerings. Because it is such a large market, having an ETF could make it easier for investors who want to invest in munis. Also with such a large market, we could see more ETF providers filing for muni ETF offerings.
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