PRFHX

About PRFHX

T. Rowe Price Tax-Free High Yield Fund is an open-end mutual fund focused on providing a high level of income that is exempt from federal income taxes. The fund primarily invests in long-term municipal securities, with a substantial allocation to bonds rated below investment grade, often referred to as “junk” or high yield municipal bonds. This approach targets issuers such as state and local governments, utility authorities, transportation projects, healthcare, and education sectors, aiming to capture higher yields relative to investment-grade municipal funds. A disciplined, research-driven investment strategy is used to balance risk and reward, with careful attention to credit quality and diversification across sectors and issuers. While at least 80% of the income is federally tax-free, up to 20% may be subject to the alternative minimum tax. The fund plays a notable role in the market by offering risk-conscious investors access to higher municipal income potential without exposure to federal taxes, making it a distinctive solution among high yield muni funds with over $3 billion in assets under management as of mid-2025.