The ETN JPMorgan Alerian MLP Index ETN (NYSEArca: AMJ) is another option for MLP exposure. The fund provides an income stream that may be better than most bond or equity funds, with ample room for increased distribution in the future, remarks Paul Justice for Money Show. The fund tracks the Alerian MLP Index and has an expense ratio of 0.85%. [ALPS Advisors Files for First MLP ETF.]
Currently, most MLPs provide yields that are higher than the market, and the more efficient partnerships have been increasing distributions faster than most high-income securities. The only drawback to an ETN is that it represents an unsecured obligation of a bank behind it – the ETN is only good if the bank remains solvent. There are, however, some ETFs in the works that will give exposure to the space. [Van Eck Files to Launch an MLP ETF.]
For more information on Master Limited Partnerships, visit our MLPs category.
Max Chen contributed to this article.