Van Eck Files to Launch an MLP ETF | ETF Trends

Van Eck Global, the name behind the Market Vectors exchange traded funds (ETFs), filed with the Securities and Exchange Commission to offer a passive ETF based on master limited partnerships (MLPs).

The filing states that the new fund will reflect the Market Vectors MLP Index and will be listed on the New York Stock Exchange, writes Olivier Ludwig for IndexUniverse. MLPs, or master limited partnerships, concentrate on the storage and transportation of energy products.

Van Eck’s proposed ETF follows a similar offering by ALPS Advisors‘ earlier announcement to launch the Alerian MLP ETF. Current options on MLP products only include exchange traded notes (ETNs). [ALPS Advisors Files for First MLP ETF.]

Van Eck’s MLP ETFs will be taxed as regular corporation for federal income tax purposes. The ETFs will be subject to federal income taxes on its taxable income at federal rates and will also be subject to state income taxes. Additionally, any changes in federal or state tax laws would have a negative affect on the MLPs’ tax treatment or financial performance. [MLP ETNs: Another Source of Income?]