JPMorgan Municipal ETF JMUB

This active intermediate municipal exchange-traded fund builds a performance edge with its research-backed process, consistent execution, and an experienced and well-resourced team.

Three veteran municipal managers draw from a strong research team and J.P. Morgan’s deep supporting functions. Michelle Hallam and Michael Myers each have around three decades of industry experience to deftly navigate the fund’s positionings and daily activities. Head of the municipal platform Rachel Betton contributes high-yield calls and steers the broader team. The team paints the ETF’s broad outlines with a top-down macro view from J.P. Morgan’s broader fixed-income platform and fills in the details with robust credit research and relative value analysis. The managers rely on an 11-person credit research team that averages 18 years of experience to understand opportunities in the market. The analysts contribute fundamental research as well as relative valuation analysis and a timely response to changing market winds. This sizable team, which is among the industry’s best resourced, ensures both depth and breadth for the ETF, helping the managers source ideas across a vast municipal market without stretching itself thin.

The managers historically kept this portfolio’s duration (a measure of interest rate sensitivity) within a 5-7 year band given its intermediate mandate, though they often took on slightly more interest rate risk than its Morningstar Category index and average peer. Returns often lagged the category index when long-term yields rose, though it outperformed when yields fell, such as in the third quarter of 2024. The manager’s relative value lens also led them to overweight higher-yielding sectors such as industrial development revenue or special tax bonds, and it can have up to 10% of assets in below-investment-grade munis. The resulting higher level of credit risk works in the ETF’s favor when credit spreads tighten, often during broad market rallies like the rebound in 2021. Credit stress can dent these excess returns, but the ETF’s low high-yield allocation and rigorous credit research have kept it from trouble.

The ETF’s measured bets have safeguarded its place in the better-performing half of its category throughout recent market gyrations, though it might not outpace more aggressive peers in risk-on environments. It beat both its category index and category average over the trailing five years ending October 2025 on an absolute and risk-adjusted basis. Since-inception performance was even better, as this includes the ETF’s top-decile returns in 2019 amidst falling yields and tight credit spreads.

The fund’s 0.18% annual fee falls in the cheapest decile of its category, making it one of the cheapest active options.

A well-executed focus on relative value and robust fundamental research sets this ETF apart from peers, earning it an Above Average Process rating.

The team combines top-down macro views from quarterly meetings with the broader Global Fixed Income, Currency, and Commodity group with thorough bottom-up municipal credit research to create the portfolio’s contours. They then employ a relative value lens to identify and size their trades within a given area of the market. The managers often seek slightly more credit and interest rate risk than the category index and average peer to boost potential returns. Nonetheless, the managers actively monitor the yield curve and market conditions to actively adjust risk. Multiple layers of risk oversight and stress testing ensure the fund remains within stated guidelines, including an independent risk team.

An experienced and well-resourced analyst team helps the managers stay ahead of changing market conditions, and these contributions are integral to the process. They offer in-depth credit research, relative value calls, and timely analysis of evolving trends. For instance, the team started dialing down its higher education and hospital exposure in the second half of 2024. Credit research and stress testing correctly identified potential policy headwinds in these sectors.

Liquidity is integral to the process. The ETF often maintains around 2%-3% in cash for liquidity, though the managers can add more to prepare for tactical trading around seasonal muni market patterns. For instance, they recently spent most of their 11% cash stake snapping up attractive bargains during the market volatility in early April.

The ETF’s average duration tends to rank in the longer half of category peers and hovers above that of the category index by a few months. Though the managers do not make aggressive interest rate calls, they do deviate from the benchmark along the curve as they find attractive opportunities. Overall, the ETF has kept duration between 5 and 7 years since inception, in line with its intermediate mandate.

The managers lean into mispriced opportunities in revenue sectors over higher-quality general-obligation bonds. The ETF has consistently underweighted GO bonds versus the index by around 10 percentage points since its inception. It loads up instead on higher-yielding sectors such as industrial development revenue or special tax bonds, relying on the analyst team’s strong research capabilities to dissect their risk and reward profile. The managers also built a minor allocation over the past few years to bonds subject to the alternative minimum tax for their higher yields. They dialed down this stake throughout 2024 as potential tax changes fueled uncertainty but brought it back to around 10% by June 2025 as the final regulation largely dismissed these concerns.

Tilting toward these sectors lends the ETF a more aggressive credit quality profile compared with the category index. The portfolio features overweightings in bonds rated BBB and below compared with the index and average peer, though its high-yield stake rarely exceeds 10% of assets. The managers also pick up a small 5% stake in unrated bonds, which offers a yield boost.

The liquidity profile of JPMorgan National Municipal ETF is strong compared with other national muni intermediate bond ETFs. At 9 basis points, the average bid-ask spread as a percentage of the ETF's share price over the past 12 months through October 2025 was one of the tightest among its peers. Its roughly USD 30 million average daily volume of shares traded was the third-highest out of 43 ETF rivals in the top decile out of 75 ETF rivals and was nearly 40 times greater than that of its peer median.

There’s much to like about J.P. Morgan’s municipal team. Its veteran managers leverage a sizeable and experienced analyst group, well-resourced supporting functions, and insights from J.P. Morgan’s broader fixed-income platform. The team earns a People rating of Above Average.

Michelle Hallam, Michael Myers, and Rachel Betton each bring decades of industry experience to this strategy. This comanager setup lessens key-person risk and encourages effective collaboration. Hallam and Myers handle the ETF’s daily management while Betton leads the broader municipal team and contributes to high-yield calls.

The managers work closely with an 11-person credit research team averaging nearly two decades of industry experience, a great source of strength for this strategy. The research team, which ranks among the industry’s best, has made welcome improvements since Betton’s promotion to lead the muni team in early 2024. The team reorganized its coverage structure to better align analysts’ expertise with the strategies' risk budget and added quantitative tools to make analysts’ workflows more efficient. While these changes come with some turnover, there have been few issues in backfilling departures with experienced career analysts.

The managers handle most of the trading themselves to ensure depth of market knowledge, though they draw on two dedicated muni traders for additional support. They can also leverage cross-sector insights and capabilities from J.P. Morgan’s broader fixed-income platform. Risk management is built into the strategy’s construction process, with regular stress testing and multiple layers of oversight, including an independent risk team.

J.P. Morgan continues to build a track record of strong stewardship, supporting a Parent rating upgrade to High from Above Average.

With more than USD 4 trillion in assets under management (including USD 1.3 trillion in money market funds) and a broad reach, J.P. Morgan is among the largest active asset managers in the US, Europe, and Asia. Although some multi-asset offerings have struggled over the past five years, prompting new leadership to make changes to investment teams, its equity and fixed-income teams boast long-tenured portfolio managers who practice repeatable investment processes that have generally produced strong long-term results. Most of its funds are core building blocks with long lifetimes, though its lineup around the world also includes more-specialized options: Two options-based equity-income exchange-traded funds, launched in 2020 and 2022, are now among the firm’s largest. J.P. Morgan has been an early mover in offering active ETFs, having converted 12 of its open-end mutual funds to the structure and launching others. It isn’t always at the forefront of emerging trends. While it has filed registration statements with the Securities and Exchange Commission for an interval fund and an ETF investing in private markets, it hasn’t yet introduced such an option for all investors, whether on its own or in partnership with another asset manager, unlike some of its closest competitors.

To support the firm’s diverse investment offerings, J.P. Morgan has invested heavily in both portfolio management tools and its client organization. Over the past 10 years, the firm has developed robust proprietary technology with advanced analytics and broad buy-in from investment analysts, portfolio traders, and portfolio managers, all of whom have easy access to the platform. The firm also stands apart for its demonstrated commitment to clients. In the early 2000s, J.P. Morgan began pivoting its engagement with financial advisors to adopt a more consultative approach, supported by its sought-after Guide to the Markets research series that focuses on investor education, not product pitches. This perspective can help clients stay the course, supporting positive investor outcomes.

Incentives reinforce alignment with fundholders. Beginning more than 10 years ago, investment team compensation is tied to three-, five-, and 10-year performance, and portfolio managers must invest at least half of their deferred compensation in J.P. Morgan strategies. Many firms encourage portfolio managers to invest alongside fundholders, but J.P. Morgan goes a step further in requiring client-facing individuals to invest substantial portions of their incentive compensation in the funds.

Although some funds still face high cost hurdles, more than half of share classes charge competitive fees relative to peers.

The fund has a solid longer-term track record despite recent challenging market environments. The ETF outpaced the Bloomberg Municipal 1-15 Year Index and the average muni national intermediate category peer by 11 and 25 basis points annualized, respectively, over the trailing five years ending October 2025. This approach came with slightly more volatility than those benchmarks over this period. Nonetheless, it justified its bets with better risk-adjusted returns, as measured by its Sharpe ratio.

The fund’s longer duration and preference for higher-yielding bonds shine in falling yield environments and credit rallies. For instance, it beat the Bloomberg Municipal 1-15 Year Index category benchmark by 37 basis points between May and September 2024 as bond yields fell in reaction to the Federal Reserve’s rate cuts. Favoring higher-yielding bonds also added to the ETF’s excess returns when muni credit spreads tightened. Its 1.6% gain in 2021 nearly doubled the index’s 0.86% result, with better risk-adjusted results.

On the other hand, these tilts can spell short-term trouble for the fund in periods of credit stress and rising yields. It lagged the category index by 1.6 percentage points during the 2022 market meltdown as higher interest rates and persistent inflation rapidly pushed bond yields up. More recently, the fund struggled to keep up with the index during the first half of 2025. It suffered from both heavy issuance pushing down returns on long-term municipal bonds and widening credit spreads punishing lower-rated bonds. These bets can introduce short stretches of underperformance, but they reward the fund with strong risk-adjusted returns over longer periods.

JPMorgan Municipal ETF's Prospectus Adjusted Expense Ratio is 0.18% per year. It places it in the cheapest quintile of the Morningstar US Fund Muni National Interm Category, where the median fee is 0.5% per year. This cost positioning translates into a Medalist Rating Price Score of 2.16, which reflects its relative price positioning within the category. The Price Score ranges from -2.50 (most expensive) to +2.50 (cheapest), with higher scores indicating better cost competitiveness.