Nuveen Expands Separately Managed Account Platform With Launch of High Income Municipal SMA
Rhea-AI Summary
Nuveen, TIAA's investment manager, launches a new High Income Municipal SMA to expand its separately managed account platform. This strategic addition allows investors to access high-yield exposure across Nuveen's extensive $200 billion municipal platform, which includes various investment vehicles like mutual funds, closed-end funds, ETFs, and more.
The new strategy invests in both non-investment grade and investment grade tax-exempt bonds, with a portfolio allocation of minimum 40% to investment grade bonds and up to 60% in high income bonds. This launch follows Nuveen's January 2025 introduction of two actively-managed muni ETFs.
Led by portfolio managers Martin J. Doyle and Patrick R. Maher, the strategy aims to generate higher levels of tax-free income in the $1.6 trillion muni SMA market, which has traditionally focused on high-grade strategies. The new SMA uses the Bloomberg Municipal Bond Index as its benchmark and leverages Nuveen's specialized credit research team to deliver enhanced total return potential with tax benefits.
Positive
- Expansion into $1.6 trillion muni SMA market with new high yield product
- Leverages existing $200 billion municipal platform across multiple investment vehicles
- Minimum 40% allocation to investment grade bonds provides stability
- Diversification of product offerings with recent launch of two active muni ETFs
- Potential for higher tax-free yields through high income bonds allocation up to 60%
Negative
- Late entry into muni SMA market dominated by established high-grade strategies
- Higher risk exposure through non-investment grade bonds
News Market Reaction
On the day this news was published, JRI declined 0.15%, reflecting a mild negative market reaction.
Data tracked by StockTitan Argus on the day of publication.
Strategy Offers Differentiated Opportunity for Additional Yield
With the new SMA, high yield exposure can now be accessed across the entirety of Nuveen's nearly
The strategy invests in non-investment grade and investment grade tax-exempt bonds, leveraging Nuveen's highly specialized credit research team to deliver an investment solution focused on generating higher levels of tax-free income that is not yet widely available via the SMA wrapper. The portfolio allocates a minimum of
"The current
About the Strategy: | |
Name: | Nuveen High Income Municipal SMA |
Investment Objective: | Primarily invests in municipal bonds across both investment-grade and non-investment grade credit spectrums. Seeks to deliver investors a high level of tax-free income. |
Reference Benchmark: | Bloomberg Municipal Bond Index |
Portfolio Managers: | Martin J. Doyle, CFA; Patrick R. Maher |
About Nuveen's Municipal Platform
Nuveen is an industry leader ranking among the largest municipal fund managers, with nearly 80 investment professionals averaging 22 years of experience. The firm's specialized municipal credit research team is one of the largest and most experienced in the asset class and was recently named the #1 team in the 2024 Smith's All-Star Municipal Analysts Awards1.
About Nuveen's SMA Suite
As the 11th largest firm in overall SMA market share2, Nuveen offers a range of strategies addressing growing investor interest in personalization and adaptability as they seek out solutions to meet their individualized financial objectives. Nuveen's SMA capabilities cover municipal and taxable fixed income approaches seeking yield or total return; diverse equity capabilities across geography, capitalization and style, and nontraditional offerings including direct indexing and multi-asset.
Media Contact
E-Soo Kim | E-Soo.Kim@nuveen.com | 551-224-4919
About Nuveen
Nuveen, the investment manager of TIAA, offers a comprehensive range of outcome-focused investment solutions designed to secure the long-term financial goals of institutional and individual investors. Nuveen has
This material is not intended to be a recommendation or investment advice, does not constitute a solicitation to buy, sell or hold a security or investment strategy and is not provided in a fiduciary capacity. The information provided does not take into account the specific objectives or circumstances of any particular investor, or suggest any specific course of action. Investment decisions should be made based on an investor's objectives and circumstances and in consultation with their financial advisors. Financial professionals should independently evaluate the risks associated with products or services and exercise independent judgment with respect to their clients. It is important to review your investment objectives, risk tolerance and liquidity needs before choosing an investment style or manager.
Important information on risk
Past performance is no guarantee of future results. All investments carry a certain degree of risk, including the possible loss of principal, and there is no assurance that an investment will provide positive performance over any period of time. Certain products and services may not be available to all entities or persons. There is no guarantee that investment objectives will be achieved.
Investing in municipal bonds and a municipal bond investment vehicle involves risks such as market risk, credit risk, interest rate/duration risk, call risk, tax risk, political and economic risk, and income risk. Credit risk refers to an issuers ability to make interest and principal payments when due. The value of the portfolio will fluctuate based on the value of the underlying securities. Typically the value of, and income generated by, debt securities will decrease or increase based on changes in market interest rates. As interest rates rise, bond prices fall. If sold prior to maturity, municipal securities are subject to gain/losses based on the level of interest rates, market conditions and the credit quality of the issuer. There are special risks associated investments in high yield bonds, hedging activities and the potential use of leverage. Portfolios that include lower rated and/or non-rated municipal bonds commonly referred to as "high yield" or "junk" bonds, which are considered to be speculative, the credit and investment risk is heightened for the portfolio. Bond insurance guarantees only the payment of principal and interest on the bond when due, and not the value of the bonds themselves, which will fluctuate with the bond market and the financial success of the issuer and the insurer. No representation is made as to an insurer's ability to meet their commitments. Income is only one component of performance and investor should consider all of the risk factors for an asset class before investing. Some income may be subject to state and local taxes and to the federal alternative minimum tax. Capital gains, if any, are subject to tax.
Before investing, carefully consider fund investment objectives, risks, charges and expenses. For this and other information that should be read carefully, please request a prospectus or summary prospectus from your financial professional or Nuveen at 888.849.5734 or visit nuveen.com.
Nuveen Fund Advisors, LLC serves as the Fund's adviser and Nuveen Asset Management, LLC serves as the Fund's sub-adviser; both the adviser and sub-adviser are subsidiaries of Nuveen, LLC. Nuveen Securities, LLC, member FINRA and SIPC.
CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.
1 Smith's All-Star Municipal Analyst Awards Program is the only program that consistently and prominently provides recognition in the municipal space. Smith's Research & Gradings announced the annual awards on 04 December 2024. The program starts with the formation of Smith's Blue Ribbon Ballot Committee of Portfolio Managers. Members of the committee nominate the nation's leading municipal analysts to the ballot. Once the ballot nominations for the 29 different categories are compiled and verified, the final ballot is sent to 1,000 institutional investors for voting. The entire process is transparent, and the voting increases the democratization of the municipal bond market. Please see https://www.smithsresearch.net/events/smiths-municipal-all-star-awards for more information.
2 Ranking based on Cerulli Report:
FAQ
What is Nuveen's new High Income Municipal SMA offering in 2025?
How big is the municipal SMA market that Nuveen is entering?
Who manages Nuveen's High Income Municipal SMA portfolio?
What percentage of high income bonds does Nuveen's new Municipal SMA include?
How does Nuveen's new Municipal SMA fit into their existing platform?
