Investment Advisor Adds Shares of Municipal Bond ETF. Should Retail Investors Follow Suit?
Key Points
Added 75,648 shares of FMB, increasing the position by an estimated $4.02 million vs. prior quarter
Post-trade position: 288,013 shares valued at $14.60 million
FMB now represents approximately 3.4% of Frisch Financial Group, Inc.’s 13F AUM, which places it outside the fund's top five holdings
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On November 7, 2025, Frisch Financial Group, Inc. disclosed in a U.S. Securities and Exchange Commission filing that it increased its stake in First Trust Managed Municipal ETF (NASDAQ:FMB) by 75,648 shares, an estimated $4.02 million change.
What Happened
According to a filing with the U.S. Securities and Exchange Commission dated November 7, 2025, Frisch Financial Group, Inc. increased its reported holdings in First Trust Managed Municipal ETF during the third quarter. The firm added 75,648 shares, bringing its total position to 288,013 shares valued at $14.60 million as of September 30, 2025.
What Else to Know
FMB now comprises approximately 3.4% of Frisch Financial Group, Inc.'s 13F AUM after the transaction.
Top five holdings after the filing:
- JPST: approximately $29.98 million (approximately 7.0% of AUM)
- RSP: approximately $29.77 million (approximately 6.9% of AUM)
- VTV: approximately $26.73 million (approximately 6.2% of AUM)
- BINC: approximately $24.64 million (approximately 5.7% of AUM)
- GOOGL: approximately $23.93 million (approximately 5.6% of AUM)
As of November 7, 2025, FMB shares were priced at $51.23, up approximately 3.9% over the prior year; shares have underperformed the S&P 500 by 9.04 percentage points over the same period.
Company Overview
| Metric | Value |
|---|---|
| Price (as of market close 11/07/25) | $51.23 |
| 1-year total return | 3.89% |
Company Snapshot
- Investment strategy focuses on investing at least 80% of assets in municipal debt securities exempt from regular federal income taxes, targeting income and capital preservation.
- Portfolio is primarily composed of municipal debt securities exempt from regular federal income taxes.
- Structured as an exchange-traded fund, the product is designed for investors seeking tax-exempt income and liquidity.
First Trust Managed Municipal ETF (FMB) is a tax-exempt municipal bond ETF with a market capitalization of $1.89 billion. The fund employs an actively managed strategy to invest in a diversified portfolio of municipal debt securities, seeking to deliver stable income and capital preservation. FMB's competitive dividend yield and focus on credit quality make it a compelling choice for investors seeking tax-advantaged income solutions within a liquid ETF structure.
Foolish Take
To start, let's talk about what First Trust Managed Municipal ETF (FMB) is, and what sort of investor may be interested in it. In short, this ETF is a tax-advantaged product, that is perfect for income-seeking investors. The ETF holds many municipal bonds -- derived from loans taken out by cities, states, and counties throughout the United States. Crucially, these interest paid to investors who hold these bonds is tax-exempt -- making them ideal for those seeking passive income. As for this ETF specifically, FMB sports a solid dividend yield of 3.4%.
Yet, for those interested in municipal bond ETFs, FMB is far from the only game in town. Take Vanguard Tax-Exempt Bond ETF (VTEB), for example. It sports a similar dividend yield of 3.3% but comes with much lower fees. FMB has an expense ratio of 0.65%, while VTEB's expense ratio comes in at a rock-bottom rate of 0.03%.
As for performance, the two funds have a nearly identical performance history over the last five years.
FMB Total Return Level data by YCharts
Given the similar characteristics between FMB and VTEB, income-oriented investors may want to give VTEB a closer look, given its lower fees.
Glossary
ETF (Exchange-Traded Fund): An investment fund traded on stock exchanges, holding a basket of assets like stocks or bonds.
Municipal debt securities: Bonds issued by state or local governments, often offering tax-exempt interest income.
13F reportable assets: Securities that institutional investment managers must disclose in quarterly SEC filings if they exceed certain thresholds.
AUM (Assets Under Management): The total market value of assets that an investment firm manages on behalf of clients.
Dividend yield: Annual dividends paid by an investment, expressed as a percentage of its current price.
Actively managed strategy: An investment approach where managers make ongoing decisions to buy or sell assets, rather than tracking an index.
Tax-exempt income: Earnings from certain investments, such as municipal bonds, that are not subject to federal income tax.
Capital preservation: An investment goal focused on preventing loss of principal, prioritizing safety over high returns.
Liquidity: The ease with which an asset can be quickly bought or sold without significantly affecting its price.
Credit quality: A measure of a bond issuer's ability to repay its debt, indicating the risk of default.
Annualized: Converted to a yearly rate, allowing comparison of returns or yields over different time periods.
Trailing the S&P 500: Underperforming the S&P 500 index over a specified time period.
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Jake Lerch has positions in Alphabet. The Motley Fool has positions in and recommends Alphabet and Vanguard Index Funds - Vanguard Value ETF. The Motley Fool has a disclosure policy.
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