Self Directed Investor Inc
SDI: "Empowering investors with ideas and education"
Symbol Lookup »  
Topics:ChinaETFsEarningsEconomyEnergyForexGoldIncomeLessonsIdeasTrading

  • Other news: News from PR Newswire
| More

MLP ETFs Have Post-Election Hangover

Mon, Nov 19, 9:15 AM ET, by Michael Johnston

It’s a little more than a week out, but one of the biggest losers from the 2012 elections so far has been the entities responsible for transporting oil and gas across North America and storing petroleum products. Master Limited Partnerships have seen a string of steep sell-offs in recent days, erasing the impressive gains that had been accumulated during the first ten months of the year. These generally stable entities have seen significant downside volatility in recent days, stringing together long losing streaks that are uncommon in this corner of the energy market [see our Energy Bull ETFdb Portfolio].

Most MLP ETPs are near breakeven territory year-to-date:

Symbol Name 1 Week 4 Week YTD 1 Year 3 Year 5 Year
AMJ Alerian MLP Index ETN -6.37% -8.92% -0.09% 6.26% 65.91% n/a
AMLP Alerian MLP ETF -4.24% -5.78% -0.48% 4.35% n/a n/a
MLPI E-TRACS Alerian MLP Infrastructure Index -6.41% -8.87% -0.76% 9.13% n/a n/a
MLPN Cushing 30 MLP Index ETN -7.00% -9.88% -4.42% 2.40% n/a n/a
EMLP North American Energy Infrastructure Fund -3.97% -8.53% n/a n/a n/a n/a
YMLP Yorkville High Income MLP ETF -11.13% -13.75% n/a n/a n/a n/a
MLPG E-TRACS Alerian Natural Gas MLP Index -7.80% -12.07% -3.07% 1.40% n/a n/a
AMU ETRACS Alerian MLP Index ETN -6.46% -8.59% n/a n/a n/a n/a
MLPY Cushing MLP High Income Index ETN -7.13% -11.98% 1.16% 2.18% n/a n/a
MLPA MLP ETF -7.74% -9.48% n/a n/a n/a n/a
MLPW E-TRACS Wells Fargo MLP Index -6.77% -9.44% 2.69% 6.93% n/a n/a
Returns as of 11/16/2012

Higher Taxes, Lower Drilling

With uncertainty looming over the tax picture in 2013, part of the sell-off in MLPs could be related to the fear that tax exemptions afforded to MLPs could disappear going forward (MLPs are able to avoid “double taxation” of dividends as long as certain criteria are met). While the elimination of those tax advantages is certainly a possibility, it would do very little to solve the fiscal issues; according to the Joint Committee on Taxation, the MLP tax breaks would generate only about $300 million for the government–or about 2.5 hours of deficit buildup [see also ETF Picks For 3 Of America's Best Small Companies].

Another factor that may be weighing on MLPs this week relates to the outlook for U.S. drilling activity–which in turn drives the demand for transportation and storage services provided by MLPs. As highlighted during the debates, Obama is considerably less open to increasing drilling in the U.S. while his opponent had made the Keystone Pipeline a key part of his initiative to create domestic jobs. That boost to MLPs is likely now off the table [see 5 ETF Strategies To Reign In Risk].

High Yield Opportunity?

Of course, the recent decline in prices has had the effect of pushing up yields on MLP ETPs; effective distribution yields are now as high as 7.8% for the Cushing MLP High Income Index ETN (MLPY, A-) and 6.3% for the popular Alerian MLP ETF (AMLP, A+). Again, it’s worth noting that the operations of these entities are relatively stable; they generate fee-based revenue that doesn’t depend much on spot prices for oil and gas, and the current tax code incentivizes them to pay out substantial portions of current earnings in the form of dividends.

In other words, the recent sell-off has perhaps created some attractive entry points for an asset class that should continue to churn out cash to shareholders for the foreseeable future. If you’re considering a position in MLPs, it’s worthwhile reviewing the pros and cons of the two primary structures through which these securities can be accessed–this is one case where ETFs and ETNs are very different.

[For more ETF analysis, make sure to sign up for our free ETF newsletter or try a free seven day trial to ETFdb Pro]

Disclosure: No positions at time of writing.


SDI Glossary: "price" Definition
SDI Glossary: "ETFs" Definition
SDI Glossary: "Risk" Definition
SDI Glossary: "Yield" Definition
This Article's Word Cloud:   AMLP   Alerian   America   Cushing   ETFdb   ETPs   Energy   High   Income   Index   Infrastructure   MLPY   MLPs   North   Partnerships   TRACS   Week   Year   about   been   could   current   date   days   dividends   drilling   during   entities   free   generate   have   little   long   more   part   prices   recent   seen   sell   stable   territory   that   these   this   very   week   which   would   year   yields

| More

VUG Crosses Above Key Moving Average Level
Mon, Oct 20, 4:14 PM ET, by ETF Channel

In trading on Monday, shares of the Vanguard Growth ETF (VUG) crossed above their 200 ...

NASDAQ-100 Equal Weighted Index Shares Breaks Above 200-Day Moving Average - Bullish for QQQE
Mon, Oct 20, 4:14 PM ET, by ETF Channel

In trading on Monday, shares of the NASDAQ-100 Equal Weighted Index Shares ETF (QQQE) crossed ...

Pharmaceutical (PPH) Shares Cross Above 200 DMA
Mon, Oct 20, 3:54 PM ET, by ETF Channel

In trading on Monday, shares of the Pharmaceutical ETF (PPH) crossed above their 200 day ...

Proshares Ultra High Yield (UJB) Shares Cross Above 200 DMA
Mon, Oct 20, 3:54 PM ET, by ETF Channel

In trading on Monday, shares of the Proshares Ultra High Yield ETF (UJB) crossed above ...

iShares Select Dividend Breaks Above 200-Day Moving Average - Bullish for DVY
Mon, Oct 20, 3:54 PM ET, by ETF Channel

In trading on Monday, shares of the iShares Select Dividend ETF (DVY) crossed above their ...

IWF Makes Bullish Cross Above Critical Moving Average
Mon, Oct 20, 3:54 PM ET, by ETF Channel

In trading on Monday, shares of the iShares Russell 1000 Growth ETF (IWF) crossed above ...

IWY, GOOGL, FB, PEP: ETF Inflow Alert
Mon, Oct 20, 11:24 AM ET, by ETF Channel

Symbols mentioned in this story: IWY, GOOGL, FB, PEP Exchange traded funds (ETFs) trade just ...

UUP: Large Inflows Detected at ETF
Mon, Oct 20, 11:24 AM ET, by ETF Channel

Symbols mentioned in this story: UUP Exchange traded funds (ETFs) trade just like stocks, but ...

OEF, INTC, ORCL, ABBV: Large Inflows Detected at ETF
Mon, Oct 20, 11:14 AM ET, by ETF Channel

Symbols mentioned in this story: OEF, INTC, ORCL, ABBV Exchange traded funds (ETFs) trade just ...

VTV, WFC, BRK.B, JPM: ETF Inflow Alert
Mon, Oct 20, 11:14 AM ET, by ETF Channel

Symbols mentioned in this story: VTV, WFC, BRK.B, JPM Exchange traded funds (ETFs) trade just ...

BIV: ETF Inflow Alert
Mon, Oct 20, 11:14 AM ET, by ETF Channel

Symbols mentioned in this story: BIV Exchange traded funds (ETFs) trade just like stocks, but ...

FAS, AFL, AMG, ARE: ETF Inflow Alert
Mon, Oct 20, 11:14 AM ET, by ETF Channel

Symbols mentioned in this story: FAS, AFL, AMG, ARE Exchange traded funds (ETFs) trade just ...

14.6% of FYT Holdings Seeing Recent Insider Buys
Mon, Oct 20, 9:44 AM ET, by ETF Channel

A look at the weighted underlying holdings of the First Trust Small Cap Value AlphaDEX ...

SKT Named Top 25 SAFE Dividend Stock Increasing Payments For Decades
Mon, Oct 20, 9:34 AM ET, by ETF Channel

Tanger Factory Outlet Centers, Inc. (SKT) has been named to the Dividend Channel ''S.A.F.E. ...

CHLC Crosses Below Key Moving Average Level
Fri, Oct 17, 4:14 PM ET, by ETF Channel

In trading on Friday, shares of the Renminbi Bond ETF (CHLC) crossed below their 200 ...

Regeneron Pharmaceuticals Moves Up In Analyst Rankings, Passing Harman International Industries
Fri, Oct 17, 11:54 AM ET, by ETF Channel

In a study of analyst recommendations at the major brokerages, for the underlying components of ...

SSO, AES, A, GAS: ETF Outflow Alert
Fri, Oct 17, 11:14 AM ET, by ETF Channel

Symbols mentioned in this story: SSO, AES, A, GAS Exchange traded funds (ETFs) trade just ...

VO, AVGO, CMG, MCO: ETF Inflow Alert
Fri, Oct 17, 11:14 AM ET, by ETF Channel

Symbols mentioned in this story: VO, AVGO, CMG, MCO Exchange traded funds (ETFs) trade just ...

SDOW Crosses Below Key Moving Average Level
Fri, Oct 17, 11:14 AM ET, by ETF Channel

In trading on Friday, shares of the Proshares UltraPro Short Dow30 ETF (SDOW) crossed below ...

Daily Technology Bull 3x Shares Breaks Above 200-Day Moving Average - Bullish for TECL
Fri, Oct 17, 11:14 AM ET, by ETF Channel

In trading on Friday, shares of the Daily Technology Bull 3x Shares ETF (TECL) crossed ...

Proshares Short Dow30 Breaks Below 200-Day Moving Average - Notable for DOG
Fri, Oct 17, 11:14 AM ET, by ETF Channel

In trading on Friday, shares of the Proshares Short Dow30 ETF (DOG) crossed below their ...

iShares MSCI Indonesia Breaks Above 200-Day Moving Average - Bullish for EIDO
Fri, Oct 17, 11:14 AM ET, by ETF Channel

In trading on Friday, shares of the iShares MSCI Indonesia ETF (EIDO) crossed above their ...

First Trust NYSE Arca Biotechnology Index Fund Experiences Big Inflow
Fri, Oct 17, 10:54 AM ET, by ETF Channel

Symbols mentioned in this story: FBT, EXAS, UTHR, BMRN Exchange traded funds (ETFs) trade just ...

DWAS, AKRX, PCRX, LCI: Large Outflows Detected at ETF
Fri, Oct 17, 10:54 AM ET, by ETF Channel

Symbols mentioned in this story: DWAS, AKRX, PCRX, LCI Exchange traded funds (ETFs) trade just ...

SLX Crosses Critical Technical Indicator
Thu, Oct 16, 4:14 PM ET, by ETF Channel

In trading on Thursday, shares of the Steel ETF (SLX) entered into oversold territory, changing ...

Shares of FTSL Now Oversold
Thu, Oct 16, 4:14 PM ET, by ETF Channel

In trading on Thursday, shares of the First Trust Senior Loan Fund ETF (FTSL) entered ...

Gannett Takes Over #48 Spot From Agilent Technologies
Thu, Oct 16, 11:54 AM ET, by ETF Channel

In a study of analyst recommendations at the major brokerages, for the underlying components of ...

KXI Crosses Critical Technical Indicator
Thu, Oct 16, 11:14 AM ET, by ETF Channel

In trading on Thursday, shares of the iShares Global Consumer Staples ETF (KXI) entered into ...

KIE Crowded With Sellers
Thu, Oct 16, 11:14 AM ET, by ETF Channel

In trading on Thursday, shares of the SPDR S&P Insurance ETF (KIE) entered into oversold ...

ETFS Physical Platinum Shares (PPLT) Enters Oversold Territory
Thu, Oct 16, 11:14 AM ET, by ETF Channel

In trading on Thursday, shares of the ETFS Physical Platinum Shares ETF (PPLT) entered into ...

Shares of DHS Now Oversold
Thu, Oct 16, 11:14 AM ET, by ETF Channel

In trading on Thursday, shares of the WisdomTree Equity Income Fund ETF (DHS) entered into ...

IHY Crosses Critical Technical Indicator
Thu, Oct 16, 11:14 AM ET, by ETF Channel

In trading on Thursday, shares of the International High Yield Bond ETF (IHY) entered into ...

Shares of IYC Now Oversold
Thu, Oct 16, 10:54 AM ET, by ETF Channel

In trading on Thursday, shares of the iShares U.S. Consumer Services ETF (IYC) entered into ...

MOAT Crosses Critical Technical Indicator
Thu, Oct 16, 10:54 AM ET, by ETF Channel

In trading on Thursday, shares of the Morningstar Wide Moat ETF (MOAT) entered into oversold ...

Shares of XLY Now Oversold
Thu, Oct 16, 10:54 AM ET, by ETF Channel

In trading on Thursday, shares of the Consumer Discretionary Select Sector SPDR Fund ETF (XLY) ...

FAS Crosses Critical Technical Indicator
Thu, Oct 16, 10:54 AM ET, by ETF Channel

In trading on Thursday, shares of the Daily Financial Bull 3x Shares ETF (FAS) entered ...

EMB: Large Inflows Detected at ETF
Thu, Oct 16, 10:54 AM ET, by ETF Channel

Symbols mentioned in this story: EMB Exchange traded funds (ETFs) trade just like stocks, but ...

ETFS Physical Palladium Shares (PALL) Enters Oversold Territory
Thu, Oct 16, 10:54 AM ET, by ETF Channel

In trading on Thursday, shares of the ETFS Physical Palladium Shares ETF (PALL) entered into ...

First Trust Dow Jones Internet Index Fund (FDN) Enters Oversold Territory
Thu, Oct 16, 10:54 AM ET, by ETF Channel

In trading on Thursday, shares of the First Trust Dow Jones Internet Index Fund ETF ...

MCD Named Top 25 SAFE Dividend Stock Increasing Payments For Decades
Thu, Oct 16, 8:34 AM ET, by ETF Channel

McDonald's Corp (MCD) has been named to the Dividend Channel ''S.A.F.E. 25'' list, signifying a ...

Brazil Consumer (BRAQ) Shares Cross Below 200 DMA
Wed, Oct 15, 4:14 PM ET, by ETF Channel

In trading on Wednesday, shares of the Brazil Consumer ETF (BRAQ) crossed below their 200 ...

EGShares S&P Emerging Markets Core (EMCR) Shares Cross Below 200 DMA
Wed, Oct 15, 4:14 PM ET, by ETF Channel

In trading on Wednesday, shares of the EGShares S&P Emerging Markets Core ETF (EMCR) crossed ...

EU Crosses Above Key Moving Average Level
Wed, Oct 15, 4:14 PM ET, by ETF Channel

In trading on Wednesday, shares of the WisdomTree Euro Debt Fund ETF (EU) crossed above ...

PUI Crowded With Sellers
Wed, Oct 15, 3:54 PM ET, by ETF Channel

In trading on Wednesday, shares of the PowerShares DWA Utilities Momentum Portfolio ETF (PUI) entered ...

Proshares Ultra Consumer Goods Getting Very Oversold
Wed, Oct 15, 3:54 PM ET, by ETF Channel

In trading on Wednesday, shares of the Proshares Ultra Consumer Goods ETF (UGE) entered into ...

IYG Crowded With Sellers
Wed, Oct 15, 3:54 PM ET, by ETF Channel

In trading on Wednesday, shares of the iShares U.S. Financial Services ETF (IYG) entered into ...

PIE Crosses Critical Technical Indicator
Wed, Oct 15, 3:54 PM ET, by ETF Channel

In trading on Wednesday, shares of the PowerShares DWA Emerging Markets Momentum Portfolio ETF (PIE) ...

Shares of FXO Now Oversold
Wed, Oct 15, 3:54 PM ET, by ETF Channel

In trading on Wednesday, shares of the First Trust Financials AlphaDEX Fund ETF (FXO) entered ...

FLN Crosses Critical Technical Indicator
Wed, Oct 15, 3:54 PM ET, by ETF Channel

In trading on Wednesday, shares of the First Trust Latin America AlphaDEX Fund ETF (FLN) ...

Electronic Arts Takes Over #144 Spot From MasterCard
Wed, Oct 15, 12:14 PM ET, by ETF Channel

In a study of analyst recommendations at the major brokerages, for the underlying components of ...

Related videos | all videos »
  More articles:  1 2 3 4 5 6 7 next »

ABOUT US »   ADVERTISE »   CONTACT US »   TERMS OF USE & PRIVACY POLICY »

MLP ETFs Have Post-Election Hangover | Self Directed Investor | Copyright © 2008 - 2014, All Rights Reserved

Any ideas and opinions presented in Self Directed Investor content are for informational and educational purposes only, and do not reflect the opinions of BNK Invest, Inc. or any of its affiliates, subsidiaries or partners. In no way should any content contained herein be interpreted to represent trading or investment advice. None of the information contained herein constitutes a recommendation that any particular security, portfolio, transaction, or investment strategy is suitable for any specific person. All site visitors agree that under no circumstances will BNK Invest, Inc,. its subsidiaries, partners, officers, employees, affiliates, or agents be held liable for any loss or damage caused by your reliance on information obtained. Read Full Disclaimer.

SDI is associated with: ValueForum.com -- a subscription-based online social networking forum of over 1000 individual investors. | MarketNewsVideo.com -- videos appearing on SDI are produced by Market News Video. | TickerTech.com -- stock quote content appearing on SDI is at least 20 minutes delayed and is powered by Ticker Technologies. | GoldStockStrategist.com -- Edited by Scott V. Nystrom, PhD, Gold Stock Strategist provides analysis on gold mining companies.