An Excellent Core Choice for Muni Investors

Beth Foos: Fidelity Municipal Income Fund remains a compelling choice for muni investors looking for a core holding in their portfolio. A strong team with impressive analytic tools and low expenses has led this fund to a solid long-term record. The fund has experienced some investment team changes in the past several years, yet the impact on its process has been limited thus far, supporting a Morningstar Analyst Rating of Gold.

Veteran muni manager Jamie Pagliocco transitioned off of the firm's muni team in 2016 and became the firm's co-CIO of fixed income in mid-2017. The fund remained in good hands though. His comanagers, Mark Sommer and Kevin Ramundo, who have been managing muni funds at the firm for a decade or longer, were named on the firm's entire suite of muni offerings in 2016. Cormac Cullen, also a muni market vet, was named to the fund at that time as well. The analyst team has also seen turnover in the past three years, but the firm hired experienced people to fill out those ranks keeping this a strong group.

With all of that, the team's approach has remained consistent over time. The fund's managers, traders, and analysts have developed a suite of sophisticated analytic tools to monitor risks in the portfolio through multiple lenses. They focus on bottom-up research to find value in the market and avoid tools that can add volatility, which has served investors well. This fund's straightforward approach and strong risk-adjusted returns over the past decade make it worth a look for muni investors.