PIMCO Intermediate Municipal Bond Active Exchange-Traded Fund

PIMCO Intermediate Municipal Bond Active Exchange-Traded Fund (MUNI) is an actively managed portfolio of about 650 investment-grade municipal bonds. Municipal bonds are debts of states and local governments, and their interest is generally exempt from federal income tax. Index funds such as VTEB and MUB follow a fixed set of rules. At MUNI, PIMCO picks bonds for income and can adjust how sensitive the fund is to interest rates. That costs 0.35% a year, against 0.03% for VTEB.

• Over the year to Oct 27, 2026, MUNI returned +0.2%, 1st of 8 among similar funds.
• Its 5-year annualized return was +1.2% and its 10-year +2.1%.
• In the 2020 COVID crash it fell 10.8% and regained its old high 3.8 months after the low.
• Its worst full calendar year was 2022 (-6.6%); its best was 2011 (+8.0%).
• The deepest fall in its price history was 11.2% (Jul 19, 2021 to Oct 25, 2022), recovered by Aug 2, 2024.

As of Jun 30, 2026, the fund held 647 securities; the ten largest made up 10.73% of assets.

The bonds mature in 15.3 years on average (weighted by size), with an average coupon of 4.41%.

• Over the three months to Jun 30, 2026, investors added a net $295.9M (creations minus redemptions, per the N-PORT report).
• Monthly total returns reported for that quarter: +0.75%, +0.36%, +0.54%.

MUNI is run by Pacific Investment Management Company (PIMCO), and its managers choose the bonds rather than copying an index. Its goal is attractive tax-exempt income while preserving capital. At least 80% of assets go into municipal bonds whose interest, in the opinion of the issuer's bond lawyers, is exempt from federal income tax. Every bond must be investment grade: rated Baa or higher by Moody's or the equivalent, or judged comparable by PIMCO if unrated. When rating agencies disagree, PIMCO uses the highest rating. Up to 30% of net assets may be in "private activity" bonds, whose interest counts toward the alternative minimum tax (AMT), a separate federal tax calculation.

PIMCO measures interest-rate risk against the Bloomberg 1-15 Year Municipal Bond Index. Duration measures how much a bond's price moves when rates change. The fund's duration can range from 2 years below to 4 years above the index's, which was 5.50 years as of September 30, 2026. Within that range, the manager looks for bonds with steady, attractive yields or competitive prices. The fund may put 25% or more in bonds that finance similar projects, such as health care, housing or utilities.

The fund may use derivatives such as futures and swaps, but its June 30, 2026 holdings report showed none. It held 647 bonds: 88.2% municipal and 6.15% US Treasury. Portfolio turnover was 20%.

• MUNI charges 0.35% a year, versus an average of 0.24% for the similar funds below (7th of 8, cheapest first).
• Using the prospectus's standard example, $10,000 invested would cost about $36 in the first year and $443 over 10 years (assuming a 5% annual return).

Its stated goal is tax-exempt income, it pays monthly and it holds only investment-grade bonds, so it fits best as a source of after-tax income in a taxable account.

MUNI could add monthly, mostly federally tax-exempt income. Its trailing 12-month yield was 3.37% as of October 27, 2026. It launched in November 2009, so it has no record from the 2008 crisis. In the 2020 COVID crash it fell 10.8% in two weeks of March but recovered by July 2020. Rising rates hurt more. 2022 was its worst calendar year, a loss of 6.78%. Its deepest drop, 11.2% from July 2021 to October 2022, did not fully recover until August 2024. Someone forced to sell during that stretch would have locked in losses. Its 0.35% expense ratio comes to $443 over ten years on $10,000 in the SEC's standard example, more than most similar funds charge. The tax benefit is lost inside IRAs. Past results don't predict future returns, and a retirement plan should weigh the whole portfolio, not one fund.

Matched by bond funds with the closest average maturity and issuer mix (N-PORT).