Among the group of the MLP ETFs, the MLPA is the cheapest, taking into account the average management costs of exchange traded products belonging to the energy MLPs is nothing less than 80%. MLPA initiated by New York-based Global X on 4/19/2012 has an approximate accumulation of $5.5 million. This fund gives the investors a fabulous exposure of two main types of equities associated with the natural gas pipelines and petroleum transportation but the fund also provides exposure to equities belonging to the refining & distribution, exploration & production, and coal production.
In the foreseeable future the energy sector of the United States is expected to see a promising growth, as the economy is bound to progress in all sectors of the economy. Industrial output and expansion is grossly anticipated and the welfare of the demography would be expected to contribute its share of development into the strong and sturdy economy.
Branded as hedged investments, it is noteworthy to understand that these funds are not affected by the prices of the energy products. Their valuation only depends on the quantities of natural fuels they are able to supply throughout the networking of the country, how much supply they can cater to according to the needs of the growing economy and the places that they are able to reach. They are also recognized as funds that are capable of very high yields and very bright returns, along with the nature of being less volatile.
Sector allocations of the United States master limited partnerships fund shows 42.45% belonging to the Natural Gas Pipelines, 39.18% to the Petroleum Transportation, 6.12% to the Refining/Distribution sector, 4.96% to the Coal Production sector followed by the Exploration & Production and Oil & Gas sectors with a combined allocation of 7.29% as on 30 June 2013.
Interestingly the MLP mutual fund is found guilty of making a notorious use of the loop holes in the system. These funds use the C-corporations structures and are…