Goldman Sachs High Yield Municipal Fund Posts 3.61% Return in Q2
The Goldman Sachs High Yield Municipal Fund (GHYAX) reported a return of 3.61% for the second quarter of 2026, outperforming its benchmark, the Bloomberg High Yield Muni / Muni Bond Index (60/40), which returned 3.01%. The fund's manager focused on selection within each ratings category, increasing exposure to Non-Rated securities and reducing it to 'BBB' and 'BB' bonds.
The second quarter saw municipal credit spreads tighten by 6 basis points for both BBB and High Yield bonds. June new issue supply reached $61 billion, with $58 billion of that being tax-exempt and $3 billion taxable. This was the highest June monthly supply on record.
As a result of a rally in long end rates, the fund reduced its duration over the quarter, primarily due to bonds with negative convexity.