Goldman Sachs High Yield Municipal Fund Outperforms Benchmark in Q2

The Goldman Sachs High Yield Municipal Fund reported a return of 3.61% for the second quarter of 2026, slightly outperforming its benchmark.

In Q2, credit spreads for BBB and High Yield municipal bonds tightened by 6 basis points each, contributing to the fund's performance.

The fund manager adjusted its portfolio during the quarter, increasing exposure to non-rated securities while reducing holdings in 'BBB' and 'BB' rated bonds. This strategy allowed the fund to focus on selection within each ratings category.

As a result of a rally in long-term interest rates, the fund's duration decreased over the quarter, primarily due to negative convexity in certain bonds.