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Mutual Fund Fixed Income Investment Grade

Seix High Grade Municipal Bond

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$ (as of )
Total Assets by Class
$6,945,188.27 (as of 01/27/2022)
Total Assets by Fund
$55,751,108.36 (as of 01/27/2022)
Morningstar Category
Muni National Long

Portfolio Overview

Investment Overview

The Fund seeks to maximize total return through current income that is exempt from federal income taxes, combined with capital appreciation consistent with capital preservation, by investing in investment grade municipal securities. A dynamic, multifaceted investment process balances emphasis across four facets: duration management, yield curve positioning, sector rotation, and security selection.

Management Team

Investment Partner

Seix Investment Advisors LLC

Seix Investment Advisors is an investment management boutique focused exclusively on managing fixed income securities since 1992. Seix seeks to generate competitive absolute and relative risk-adjusted returns over the full market cycle through a bottom-up focused, top-down aware process. Seix employs multi-dimensional approaches based on strict portfolio construction methodology, sell disciplines and trading strategies with prudent risk management as a cornerstone.

Learn more about Seix Investment Advisors LLC

Investment Professionals

Ron Schwartz

Ronald H. Schwartz CFA

Managing Director, Senior Portfolio Manager

Industry start date: 1982
Start date as fund Portfolio Manager: 1994

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Dusty Self

Dusty Self

Managing Director, Senior Portfolio Manager

Industry start date: 1992
Start date as fund Portfolio Manager: 2018

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Key Features

Tax-Exempt Income

Strives to generate income free from federal income taxes

Attractive Total Return Potential

Market inefficiencies may create buying and selling opportunities that facilitate meaningful return potential

Extensive Fundamental Research

Bottom-up security selection evaluates factors such as fundamental credit analysis, security structural features, and potential price volatility

Portfolio Characteristics


(as of 12/31/2021)
Effective Duration (years) 5.28

Top Holdings (% Fund)

(as of 12/31/2021)
Texas Water Development Board, 5.0000% 10/15/2031
Washington Suburban Sanitary Commission, 5.0000% 06/15/2030
California Infrastructure & Economic Development Bank, 5.0000% 10/01/2048
State of Washington, 5.0000% 08/01/2029
Energy Northwest, 5.0000% 07/01/2033
Energy Northwest, 5.0000% 07/01/2034
State of California, 5.0000% 12/01/2028
State of Connecticut Special Tax Revenue, 5.0000% 05/01/2037
State of Maryland, 5.0000% 03/15/2031
City of Milwaukee WI, 5.0000% 04/01/2027

Holdings are subject to change.

Sector Allocation (% Fund)

(as of 12/31/2021)
Water & Sewer
State General Obligation
Special Tax
Local General Obligation
Cash & Equivalents

Performance & Risk

Growth of $10,000 Investment

From to
This chart assumes an initial investment of $10,000 made on for Class ddd shares including any applicable sales charges. Performance assumes reinvestment of dividends and capital gain distributions.


As of
As of

Performance data quoted represents past results. Past performance is no guarantee of future results and current performance may be higher or lower than the performance shown. Investment return and principal value will fluctuate, so your shares, when redeemed, may be worth more or less than their original cost.

Sales Charge and Expenses

Yields / Distributions1

(as of )
30-day SEC Yield
30-day SEC Yield (unsubsidized)
Distribution Rate (at NAV)
Income Distributions Current Month
Income Distributions YTD

Distribution History2

(as of )
Reinvest NAV

Risk Statistics3

(as of )
Fund Index
Std Dev

Risk Considerations

Credit & Interest: Debt instruments are subject to various risks, including credit and interest rate risk. The issuer of a debt security may fail to make interest and/or principal payments. Values of debt instruments may rise or fall in response to changes in interest rates, and this risk may be enhanced with longer-term maturities.
Municipal Market: Events negatively impacting a municipality, municipal security, or the municipal bond market in general, may cause the portfolio to decrease in value.
State & AMT Tax: A portion of income may be subject to some state and/or local taxes and, for certain investors, a portion may be subject to the federal alternative minimum tax.
Market Volatility: Local, regional, or global events such as war, acts of terrorism, the spread of infectious illness or other public health issues, recessions, or other events could have a significant impact on the portfolio and its investments, including hampering the ability of the portfolio manager(s) to invest the portfolio's assets as intended.
Prospectus: For additional information on risks, please see the fund's prospectus.



Market Review

In many ways, the fourth quarter of 2021 was a continuation of the one-way bull market of the previous three quarters with lesser quality paper outperforming, albeit at a reduced pace. Phenomenal retail demand continued with mutual fund flows for the calendar year topping $101 billion as volatility stayed low.  The magnitude of this insatiable retail demand is best captured by Refinitiv/Lipper, which reported municipal bond funds have seen inflows in 85 of the past 86 weeks (period ending January 5, 2022) totaling a record $164.3 billion—a record since the inception of the data in 1992.

Issuance for 2021 was approximately $481 billion, which was 3% below 2020. The 2022 pipeline could be similar, with current estimates ranging between $450 billion and $525 billion. Overall, for the year, demand was strong and spread across retail, separately managed accounts (SMA), and institutional channels.

The municipal yield curve flattened during the fourth quarter from a slope of 150 basis points (bps) for 2s-30s to 125 bps. The 2-year yield moved higher by 7 bps, while the long bond was lower in yield by 18 bps.    The Treasury curve flattened far more dramatically than the muni curve as the 2-year Treasury rose 46 bps in yield, while the 30-year Treasury was lower by 12.5 bps. This drove muni/Treasury ratios lower, making municipals more expensive than at the start of the quarter. The 2-year ratio ended at 33.1% (from 58.8%), the 5-year at 46.9% (from 50.35%), the 10-year at 68.8% (from 74.6%) and the 30-year at 78.4% (from 79.8 %). The Bloomberg Municipal Bond Index, a broad measure of the municipal market, showed a 12-month return of 1.52%, adding 0.72% during the fourth quarter.  

Longer duration outperformed continuing the trend of the previous three quarters. The five-year index total return for the quarter was 0.04%, the 10-year Index returned 0.55%, and the Long Bond Index recorded 1.58%. For the full year, the five-year had a total return of 0.34%, the 10-year was up 0.96%, and the long bond gained 3.17%. In terms of credit quality, spread movement was rather muted, the AAA index was up 0.82% as the Baa index gained 0.80%, and the AA and A indices returned 0.69% for the quarter. For the full year, the difference was amazing: the AAA index was a positive 0.47%, while the Baa index returned 4.85%—a tremendous outperformance that reflected the hefty demand in yield and exemplified the resilience of spread tightening from very wide levels that occurred in early 2020.  

Trading activity, however, was down approximately 30% for the year, limiting opportunities to take advantage of inefficiencies in the market. 


The I-shares underperformed the Bloomberg Municipal Bond Index by 7 bps, partially attributed to the underweight to the 20-year area. The Fund increased exposure to AA-rated bonds during the quarter.     

The Fund’s effective duration was unchanged from 5.27 to 5.28 years versus last quarter. The Fund compared to the Bloomberg Municipal Bond Index is overweight cash, the 7-year, and the 10-year areas, market weight to the 15-year area, and underweight the remaining maturity buckets. The Fund is underweight education, local general obligation (GO), transportation, and education sectors versus the index. State GOs, water/sewer, special tax, and electric sectors are overweight.


With investors clamoring for yield in a low-rate environment (especially in high tax states), we expect demand for municipal bonds will remain strong in 2022. However, the combination of Federal Reserve tapering of asset purchases and raising rates to help quell inflation will likely prompt an uptick in volatility.  

While we believe there is room for quality spreads to widen from their very tight levels at present, we would not, however, expect that widening to be significant. Much will depend on demand from SMAs and institutions.  While we do not foresee another year of demand like we had in 2021, should demand remain strong, yield will continue to be an important piece of the performance puzzle. Lesser quality paper should outperform, albeit to a lesser degree than seen in the last year.

The commentary is the opinion of the subadviser. This material has been prepared using sources of information generally believed to be reliable; however, its accuracy is not guaranteed. Opinions represented are subject to change and should not be considered investment advice or an offer of securities.

Related Literature

Marketing Materials

Virtus Seix High Grade Municipal Bond Fund Fact Sheet - I
Seix Market Review and Outlook - Investment Grade
Inside ESG Investing at Seix


Mutual Fund Distributions

Financial Materials

Virtus Asset Trust Statutory Prospectus
Virtus Seix High Grade Municipal Bond Fund Summary Prospectus
Virtus Asset Trust SAI
Virtus Asset Trust Annual Report
Virtus Asset Trust Semi-Annual Report - Fixed Income
Virtus Asset Trust Prospectus XBRL 485B 04 26 2021


Virtus Seix High Grade Municipal Bond Monthly Holdings
Virtus Seix High Grade Municipal Bond Fund Top Holdings
Virtus Seix High Grade Municipal Bond Fund Holdings Fiscal Q1
Virtus Seix High Grade Municipal Bond Fund Holdings Fiscal Q3

Investors should carefully consider the investment objectives, risks, charges and expenses of any Virtus Mutual Fund before investing. The prospectus and summary prospectus contains this and other information about the fund. Please contact your financial representative, call 1-800-243-4361 to obtain a current prospectus and/or summary prospectus. You should read the prospectus and/or summary prospectus carefully before you invest or send money.

Performance data quoted represents past results. Past performance is no guarantee of future results and current performance may be higher or lower than the performance shown. Investment return and principal value will fluctuate, so your shares, when redeemed, may be worth more or less than their original cost.

Average annual total return is the annual compound return for the indicated period. It reflects the change in share price and the reinvestment of all dividends and capital gains. NAV returns do not include the effect of any applicable sales charges. POP and w/CDSC returns include the effect of maximum applicable sales charges.

Returns for periods of less than one year are cumulative total returns.

1 Yields/Distributions: 30-day SEC Yield is a standardized yield calculated according to a formula set by the SEC, and is subject to change. 30-day SEC Yield (unsubsidized) is the 30-day SEC Yield without the effect of applicable expense waivers. Distribution Rate is calculated by (a) annualizing the latest income distribution for fixed income funds or funds less than 1 year old, or (b) summing all income distributions over the preceding 12 months for all other funds, and dividing the NAV on the last business date of the period, unless otherwise indicated. The Distribution Rate may be comprised of ordinary income, net realized capital gains and returns of capital.

2 Distribution History: Distributions are represented on a cash basis and may be reclassified at year end for tax purposes. The Fund will send you a Form 1099-DIV for the calendar year that will tell you how to report these distributions for federal income tax purposes. STCG: Short Term Capital Gain, LTCG: Long Term Capital Gain

3 Risk Statistics: R2 is a statistical measure that represents the percentage of a fund or security's movements that can be explained by movements in a benchmark index. Beta is a quantitative measure of the volatility of a given portfolio to the overall market. Alpha is a risk adjusted measure of an investment's excess return relative to a benchmark. A positive Alpha indicates that the investment produced a return greater than expected for the risk (as measured by Beta) taken. Standard Deviation measures variability of returns around the average return for an investment fund. Higher standard deviation suggests greater risk. Risk Statistics are calculated using 36 monthly returns.

4 Characteristics: For Equity Funds: Avg. Weighted Market Cap (bn): The total dollar market value of all of a company’s outstanding shares. Trailing P/E Ex-Negative Earnings: Per-share stock price divided by the latest 12-months Earnings per Share; Price/Cash Flow: Per-share stock price divided by the per-share operating cash flow; Price/Book: Per-share stock price divided by the latest 12-month per-share Book Value; 3-Year EPS Growth Rate: Average of earnings per share growth for latest 3-year period. The 3-Year EPS Growth Rate is not a forecast of the fund's performance.

4 Characteristics: For Fixed Income Funds: Effective Duration represents the interest rate sensitivity of a fixed income fund. For example, if a fund's effective duration is five years, a 1% increase in interest rates would result in a 5% decline in the fund's price. Similarly, a 1% decline in interest rates would result in a 5% gain in the fund's price.

Morningstar Disclosures:
The Morningstar Rating for funds, or "star rating", is calculated for managed products (including mutual funds, variable annuity and variable life subaccounts, exchange-traded funds, closed-end funds, and separate accounts) with at least a three-year history. Exchange-traded funds and open-ended mutual funds are considered a single population for comparative purposes. It is calculated based on a Morningstar Risk-Adjusted Return measure that accounts for variation in a managed product's monthly excess performance, placing more emphasis on downward variations and rewarding consistent performance. The top 10% of products in each product category receive 5 stars, the next 22.5% receive 4 stars, the next 35% receive 3 stars, the next 22.5% receive 2 stars, and the bottom 10% receive 1 star. The Overall Morningstar Rating for a managed product is derived from a weighted average of the performance figures associated with its three-, five-, and 10-year (if applicable) Morningstar Rating metrics. The weights are: 100% three-year rating for 36-59 months of total returns, 60% five-year rating/40% three-year rating for 60-119 months of total returns, and 50% 10-year rating/30% five-year rating/20% three-year rating for 120 or more months of total returns. While the 10-year overall star rating formula seems to give the most weight to the 10-year period, the most recent three-year period actually has the greatest impact because it is included in all three rating periods. Ratings do not take into account the effects of sales charges and loads.

© Morningstar, Inc. All rights reserved. The information contained herein: (1) is proprietary to Morningstar and/or its content providers; (2) may not be copied or distributed; and (3) is not warranted to be accurate, complete, or timely. Neither Morningstar nor its content providers are responsible for any damages or losses arising from any use of this information. Past performance is no guarantee of future results.