Written by David Fabian, May 10th, 2017
Income investors have always had an affinity for master limited partnerships, or MLPs. These unique vehicles offer exposure to the energy sector through a high yield, equity-like security. Their business models and tax structures are such that they can pass through a great deal of their profits to shareholders in the form of dividends. This makes them coveted for both their unconventional returns vs stocks or bonds in addition to their healthy income streams. Read more
Written by David Fabian, October 25th, 2016
The multi-year plunge in oil and natural gas prices has been partially arrested in 2016 and one high yield investment sector is riding the recovery wave higher. Master limited partnerships, or MLPs, are operators of pipeline, storage, and energy infrastructure assets primarily focused in North America.
These publicly traded entities enjoy a special tax advantage that allows them to return a large portion of their operating income to shareholders in the form of dividends. As such, they are coveted by income investors for their above-average yields and alternative business models compared to conventional dividend stocks or bonds.
Written by David Fabian, August 03rd, 2016
The definition of value is a fierce debate among investors that seek to find intrinsically underpriced assets. Some stand their ground on historical fundamentals like price/earnings or price/book ratios. Others look strictly at price relative to other potential opportunities as a measure of opportunity.
The picture becomes even more complicated when you try to compare or overlay differing asset classes. Income investors often blur the lines between bonds, dividend paying stocks, and alternative income assets. Read more
Written by David Fabian, May 21st, 2016
Everyone hated energy ETFs last year as plunging oil and natural gas prices eroded valuations of companies engaged in this sector. The weakening demand for global commodities wrought havoc among large oil producers, exploration companies, and even storage conglomerates. Read more
Written by David Fabian, April 11th, 2016
The high yield landscape has been a difficult one to navigate over the last year. The pernicious selling in commodities combined with a rocky road for stocks has led to sliding prices in junk bonds, master limited partnerships, and mortgage REITs.
These asset classes have been pilloried for luring in yield-seeking investors, only to have the rug pulled out from under them as credit conditions deteriorated. Hopefully an important lesson has been learned – the higher the yield, the higher the risk of capital invested. Read more