FMHI Profile
The First Trust Municipal High Income ETF aims to provide investors with high income through municipal debt securities while seeking to minimize federal income tax liability. Under normal market conditions, the fund commits at least 80% of its net assets, including any investment borrowings, to municipal bonds and other debt securities whose interest is exempt from regular federal income taxes. These securities are issued by or on behalf of U.S. states, territories, and possessions, as well as the District of Columbia and their various political subdivisions, agencies, authorities, and instrumentalities.
The fund focuses on high-income municipal securities, which generally offer higher yields compared to other municipal bonds due to their credit risk and market conditions. By investing primarily in such securities, the fund seeks to maximize income while maintaining the tax-exempt status of the interest income. The ETF provides investors with access to a diversified portfolio of municipal bonds, which can include general obligation bonds, revenue bonds, and other types of municipal debt.
The management strategy involves thorough analysis and selection of municipal securities based on credit quality, yield potential, and tax efficiency. The fund’s investment approach aims to balance income generation with risk management, taking into account factors such as issuer creditworthiness and market conditions. The portfolio is designed to offer both income and tax benefits, making it a suitable choice for investors seeking to enhance their portfolios with tax-exempt income.
Managed by First Trust, the ETF benefits from the firm's extensive expertise in municipal bond markets and its robust research capabilities. First Trust leverages its deep understanding of municipal finance and its rigorous selection process to construct a portfolio that aligns with the fund’s investment objectives. Investors in the First Trust Municipal High Income ETF gain access to a professionally managed, diversified portfolio of high-income municipal bonds, designed to deliver attractive after-tax returns while minimizing exposure to federal income taxes.
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