00:00Maxwell, what is the story? These muni funds are being converted into ETFs or they're just
00:05being replicated by new ETFs? So they're actually being converted into new ETFs. These were formally
00:13different types of funds, passively managed, actively managed funds, and now they are being
00:20converted into ETFs. About 15 years ago, only 1% of muni assets were held in ETFs. And now that
00:29figure has risen to about 15% of muni assets. A lot of different companies are also getting in on this
00:35trend. Alliance Bernstein isn't the only one. That was the fund conversion last month that ended up
00:42distorting the flow trends and ended up showing an outflow for the week. But other companies, including
00:49Fidelity and Franklin Templeton, have also gotten in on this conversion trend. Yeah, it's fascinating.
00:54So are pension funds and insurance funds and so on also investing in these ETFs? Or are they staying away and leaving it to the retail trade?
01:02Or how does it work? It's both retail and institutional investors that are causing this trend. Demand from both of those
01:10is very strong for ETFs right now. They have a lower cost wrapper. Their expense ratios are lower. And a lot of people want the liquidity
01:20that comes with ETFs right now. So there's a lot of demand from both institutional and retail.
01:26Now, Maxwell, I was blown away because I knew they were doing well. But apparently municipal bonds had their best month in October since literally 1990.
01:33That's 26. No, that's 36 years, right? What's behind that? And should we expect more outperformance?
01:38Strong supply and demand technicals right now. And November does seem to be a very always historically has been a strong month for
01:48municipal bond performance. And we expect that to continue as new supply ends up being lowered because there's just less issuance during the month of November.
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