Morgan Stanley Converts $10 Billion in Municipal Bond Funds to ETFs

Morgan Stanley is converting eight municipal bond mutual funds into exchange-traded funds (ETFs), affecting nearly $10 billion in assets under management. The firm plans to launch seven new ETFs as part of this transition.

The move reflects strong investor demand for municipal ETFs, which offer tax efficiency and greater flexibility compared to traditional mutual funds. Industry observers view the conversion as a defensive strategy to retain client assets amid shifting market preferences.