The fund will be investing in primarily municipal debt securities.

Financial services firm First Trust Advisors has launched a new exchange-traded fund (“ETF”), the First Trust Municipal High Income ETF.

By investing primarily in municipal debt securities, the fund seeks to provide federally tax-exempt income with a secondary objective of long-term capital appreciation, the firm said in a statement. 

The fund is managed by First Trust using a disciplined approach that focuses on a combination of quantitative analysis and fundamental research. In seeking attractive income, the fund will focus on non-rated bonds, lower investment-grade bonds and below investment-grade or “high yield” municipal bonds, while offering daily liquidity and full transparency of holdings.

Johnathan Wilhelm, senior vice president and Tom Futrell, senior vice president, will serve as senior portfolio managers of the fund. The two will share responsibilities for the day-to-day management of the fund’s investment portfolio.

“Our experienced municipal securities team at First Trust employs a rigorous, disciplined approach to managing risk, while seeking to capitalize on opportunities,” said Ryan Issakainen, senior vice president, ETF strategist. “Investor demand for tax-free income continues to grow, even as interest rates remain stubbornly low. For investors willing to take additional credit risk in pursuit of higher levels of tax-free income, we believe that active management is paramount.”

First Trust Advisors, along with its affiliate First Trust Portfolios, are privately held companies which provide a variety of investment services, including asset management and financial advisory services, with collective assets under management of approximately $111 billion, as of September 30.