For tax-conscious investing within taxable brokerage accounts, municipal bond funds can answer the call for income and returns.

Morningstar today released updated ratings for many municipal bond funds, but the highest-returning funds don’t necessarily receive the best ratings.

For example, the year-to-date returns of Morningstar gold-medal-rated municipal bond funds such as the Vanguard High-Yield Tax Exempt Fund (VWAHX), 2.17%; Fidelity Tax-Free Bond Fund (FTABX), 2.29%; and T. Rowe Price Tax-Free High-Yield Fund (PRFHX), -0.51%, outperformed some of the funds on the list of the top funds by 10-year returns, but underperformed others.

There is also evidence that active management is adding to investor returns in these mutual funds. Morningstar’s High Yield Municipal Bond category has posted an average return of 4.49% year to date, well above the corresponding Bloomberg-Barclay’s 65% High-Grade, 35% High-Yield Total Return Index, which has posted a year-to-date return of 1.86%.

What follows in ascending order is a list of the top 10 municipal bond mutual funds, excluding single-state and single-municipality funds, by 10-year total return ending on Nov. 17, 2020.

10. BlackRock High Yield Municipal Fund (MAYHX) 6.32%
BlackRock’s $1.4 billion High-Yield Municipal Fund returned 6.32% over the decade ending on Nov. 17, and sports a 0.66% annual expense ratio. The fund turned in five-year returns of 5.05%, a one-year return of 2.12% and a year-to-date return of 0.96%.