Torsten Asmus
PGIM, the $1.34T investment management business of Prudential Financial (NYSE:PRU), has rolled out two exchange-traded funds tied to municipal bonds, it said on Friday.
The new funds — PGIM Ultra Short Municipal Bond ETF (PUSH) and PGIM Municipal Income Opportunities ETF (PMIO) — will trade on NYSE Arca.
Both actively-managed ETFs invest at least 80% of their respective portfolios in municipal obligations whose income is exempt from federal income taxes.
PUSH, in particular, will mainly invest in investment-grade muni bonds and up to 10% in high-yield muni debt obligations. The fund seeks to maintain a weighted average portfolio duration of two years or less.
PMIO, by comparison, will invest at least 70% of its portfolio in investment-grade muni debt obligations and up to 30% in high yield muni debt obligations. It seeks to maintain a weighted average portfolio duration of two to eight years.
“In addition to their diversification benefits, muni bond ETFs offer an attractive opportunity for investors, particularly high-net-worth investors, who may be looking to maximize tax efficiency within their portfolios,” said Stuart Parker, president and CEO of PGIM Investments.