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A Broad and Strong Municipal Bond Fund

Daniel Sotiroff (daniel.sotiroff@morningstar.com)

Historically, gaining access to municipal bonds through an index strategy has been difficult because the muni bond market is much more fragmented and expensive to trade than other fixed-income markets. An index-tracking fund like  Vanguard Tax-Exempt Bond ETF VTEB now features exceptionally low tracking error, making it a solid choice for exposure to the broader municipal-bond market. VTEB offers broad exposure to investment-grade municipal bonds and is one of the cheapest funds in the muni national intermediate Morningstar Category, earning a Morningstar Analyst Rating of Silver.