MLP Index

[ericd1]

I've been looking at JP Morgan's Alerian's MLP ETN. The ETN attempts to track the Alerian MLP Index, which is a composite of the 50 most prominent energy master limited partnerships calculated by Standard & Poor's using a float-adjusted market capitalization methodology.

 

The index returned an average of 7.2% annually over the last 13+ years (since 12/29/95) and a total return of 15.0% because of the 7-8% yield.

 

One benefit for holding the ETF, is that it doesn't have the tax implications of MLP's.

 

Appreciate any comments...

 

 

 

 

 

[benhacker]

One benefit for holding the ETF, is that it doesn't have the tax implications of MLP's.

 

The big disadvantage is that the ETN is directly exposed to JPM's credit risk... you may be comfortable with layering that kind of (remote) risk, but it's something to think about.

 

Ben

[bargainman]

Here are a few alternatives to also consider.  Closed Ended Funds:

 

http://www.smartmoney.com/investing/stocks/Pipeline-to-Profits-17281/

 

FEN

FMO

KYN

TYG

 

 

[ericd1]

Ben - you are right about JPM's credit risk...certainly a consideration.

 

Bargain - thanks for the info on the closed end funds.  Also found MTP

 

Interesting way to boost income allocation in a retirement portfolio.