The Alerian MLP ETF (AMLP) recently celebrated an exciting milestone after years of providing simplified exposure to Master Limited Partnerships (MLPs). MLPs are known for their generous income, but direct investment in MLPs come with a Schedule K-1 for filing taxes. AMLP provides exposure to MLPs with a more-convenient Form 1099.
MLP ETF AMLP’s Big Milestone
AMLP tracks the Alerian MLP Infrastructure Index (AMZI), which is a capped, float-adjusted, capitalization-weighted composite of energy infrastructure MLPs that earn most of their cash flow from midstream activities.
Over the last 15 years, AMZI has had an average yield of 7.4%. This outpaces the average yield of other equity income investments like REITs and utilities. For the trailing 12 months, AMLP has had a yield of 8.1% according to SS&C ALPS Advisors as of September 19.
See more: The MLP Investment Case & Outlook as AMLP Turns 15
AMLP’s quarterly distributions and exposure to the exciting midstream category have helped the fund perform well in recent years. It has outperformed both its ETF Database Category and Factset Segment averages YTD, returning 5.3% in that time.
NYSE Bell Ringing
Paul Baiocchi, Head of Fund Sales and Strategy at SS&C ALPS Advisors, recently celebrated the 15th anniversary of AMLP at the New York Stock Exchange. Baiocchi joined Todd Rosenbluth, VettaFi’s Head of Research, to discuss the ETF’s past, present, and future following the NYSE bell ringing.
Baiocchi relayed the story of the fund’s arrival into the ETF ecosystem, as the first basket of MLPs in the ETF wrapper, setting the standard for the category. Today, the fund stands out as the largest and most liquid MLP ETF. .
Baiocchi also spoke to how investors are using the fund and the bifurcation within energy. While a broad energy ETF has seen notable outflows in recent years, AMLP has seen notable inflows. Midstream, he explained, has to some degree separated itself from the broader energy space. The category now offers exposure to the trend of growing electricity demand, driven by electrification and data centers, through natural gas.
AMLP is sitting at just under $1 billion in net inflows YTD, per ETF Database data. The fund has $10.5 billion in assets currently, making it the second-largest energy ETF overall. Looking ahead, AMLP could provide a yield boost to portfolios at a time when uncertainty is on the rise.
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