Fund Description

The fund invests at least 80% of net assets plus borrowings for investment in municipal bonds whose interest is exempt from regular federal personal income tax, including issues of U.S. states and their subdivisions and U.S. territories. It may invest without limit in securities generating income subject to the alternative minimum tax. Under normal market conditions, it maintains a weighted average effective duration of 3-10 years, generally 4.5-7 years. It typically holds at least 80% investment-grade municipals (BBB/Baa or higher, or comparable quality if unrated) and may invest up to 20% in below-investment-grade bonds. It may buy general obligation, revenue, lease participation, and zero-coupon bonds, invest up to 15% in inverse floaters, and use derivatives such as futures, options, and swaps to manage risks and duration. The sub-adviser follows a value-oriented approach, seeking higher-yielding, undervalued bonds and may sell holdings with deteriorating credit or limited upside potential.