Amplify ETFs has expanded its income-focused ETF lineup with the launch of the Amplify Municipal CEF High Income ETF (NYSE:YYYM) on March 10, introducing a fund that simplifies access to high-yield municipal closed-end funds.
The ETF uses a “fund-of-funds” structure to provide exposure to a diversified basket of municipal bond closed-end funds (CEFs), a segment known for attractive yields but often complicated structures. By packaging these vehicles into an ETF wrapper, the firm aims to make tax-advantaged monthly income easier for advisors and investors to access.
Rules-Based Approach To High-Yield Municipal CEFs
YYYM seeks to track the Nasdaq Municipal Bond CEF High Income Index, which selects 30 U.S.-listed municipal bond CEFs using a rules-based methodology focused on three factors: yield, discount to net asset value (NAV), and liquidity.
The index screens for funds offering yields at least 1.2 times the median yield of the broader dividend-paying CEF universe while excluding those trading at steep premiums to NAV. The approach aims to capture attractive income opportunities while avoiding overvalued funds.
The ETF carries a total expense ratio of 2.78%, which is higher than most traditional municipal bond ETFs. However, the fee reflects the “acquired fund fees” incurred in holding the underlying CEFs. For many investors, the tax-exempt nature of municipal income combined with professional management of leveraged CEF exposures could offset the higher cost, particularly for those in higher tax brackets.
Building On Amplify’s Flagship CEF ETF
The launch builds on the strategy used by the Amplify CEF High Income ETF (NYSE:YYY), Amplify’s flagship CEF-focused fund that currently manages about $700 million in assets.
While YYY offers exposure to both equity and debt closed-end funds, YYYM focuses exclusively on municipal bonds, potentially offering investors a more targeted tool for tax-efficient fixed-income allocations.
Amplify ended 2025 with 39 ETFs and roughly $17 billion in assets under management, following a year of strong growth for both the firm and the broader ETF industry.
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