Understanding the T. Rowe Price Long Municipal Income ETF (TMNL)

This report explains the data for the T. Rowe Price Long Municipal Income ETF (ticker: TMNL). This information is for educational purposes and is not financial advice.

What this ETF is trying to do

TMNL is an exchange-traded fund (ETF) that focuses on municipal income. While the specific holdings are not listed in this report, ETFs like this generally aim to provide income through municipal bonds.

What the numbers show

When looking at ETF data, it is important to understand the difference between "price return" and "total return."

• Price Return: This measures only the change in the share price. For this ETF, the Year-to-Date (YTD) price return is approximately -5.56%. This means the share price has gone down since the start of the year.

• Total Return: This measures the change in price *plus* any cash distributions received. The YTD total return for this ETF is approximately -2.50%.

Because the total return (-2.50%) is higher than the price return (-5.56%), it shows that the cash distributions helped offset some of the share-price decline.

Income and distribution explanation

Some investors look at ETFs specifically to receive regular cash payments, known as distributions.

• Distribution Yield: This ETF has a distribution yield of approximately 3.76%. This number describes the cash distributions relative to the current ETF price.

• Frequency: The fund usually pays out monthly. In the last 12 months, there were 10 payouts.

• Trailing Distributions: The amount paid out over the last year was approximately $1.78 per share.

It is important to remember that a high distribution yield does not guarantee an investor will earn that same percentage as a total return.

NAV erosion explanation

"NAV erosion" refers to a decline in the Net Asset Value (the actual value of the assets held by the fund). While the share price of TMNL has declined this year, a falling market price does not automatically prove that NAV erosion has occurred.

In this report, the "severe erosion-risk flag" is not active. The erosion score is currently withheld because there is not enough verified price history available to provide a score.

Pros

• The ETF provides regular cash distributions (usually monthly).

• The total return is higher than the price return, meaning distributions are helping to cushion the share-price decline.

Cons

• The ETF has experienced a negative YTD price return of approximately -5.56%.

• The YTD total return is also negative at approximately -2.50%.

Beginner takeaway

When studying an ETF like TMNL, don't just look at the distribution yield. Always look at the total return to see how the share price and the cash payments work together. A falling share price can make it harder to keep your original investment amount steady, even if you are receiving regular cash payments.