Goldman Sachs Dynamic Municipal Income Fund Institutional Class (GSMTX)

Overview

This fund is focused on investing in fixed income securities that have tax-exempt status under regular federal income taxes in the United States. Specifically, the investments are in securities issued by states, territories, possessions of the United States, and their political subdivisions, agencies, and instrumentalities. A key feature of this fund is its commitment to tax efficiency for investors, targeting securities where the interest is exempt from regular federal income tax, appealing to those looking to maximize after-tax returns.

Products and Services

• Fixed Income Securities:

  This primary class of investments for the fund includes bonds and other debt instruments issued by state or local governments and their subdivisions in the United States. The appeal of these securities lies in their tax-exempt status, meaning the interest income earned by investors is not subject to federal income tax, providing a net benefit in after-tax returns compared to taxable fixed income options.

• Private Activity Bonds:

  Up to 100% of the fund’s assets may be allocated to private activity bonds. These bonds, while still potentially offering tax-exempt interest, are a bit more complex as the interest may be subject to the federal alternative minimum tax (AMT). Private activity bonds are issued by or on behalf of local or state governments but the proceeds are used for the benefit of private entities. Investors looking to diversify their portfolio with high-yielding, tax-advantaged investments might find these bonds attractive, albeit with an increased level of scrutiny due to AMT considerations.