American Century Diversified Municipal Bond ETF Price & Performance (TAXF)

The American Century Diversified Municipal Bond ETF (TAXF) is attracting attention for its 3.6% yield, though its year-to-date return sits at just 0.4%. The fund's active management and diversified municipal holdings offer tax advantages, but recent price declines and rising volatility highlight ongoing uncertainties in the broader municipal bond sector.12

Municipal bond ETFs, including TAXF, are navigating a turbulent environment. Lawmakers are reconsidering the tax-exempt status of municipal bonds, and inflationary pressures may prompt further interest rate hikes. Despite these concerns, robust state finances and historically high yields continue to support investor interest in the sector.23

TAXF's strategy blends investment-grade and high-yield municipal bonds, adapting allocations based on market shifts. While offering competitive pricing and a low expense ratio of 0.29%, the ETF has underperformed category averages year-to-date. Investors are advised to assess performance and credit quality relative to lower-cost passive alternatives.14