InfraCap MLP ETF (AMZA)

ETF InfraCap MLP ETF Overview

Profile:

ETF InfraCap MLP ETF (NYSEARCA: IFRA) is an exchange-traded fund focusing on midstream energy infrastructure companies, primarily in the United States. It seeks to track the InfraCap MLP Midstream Index, which comprises publicly traded master limited partnerships (MLPs) involved in the gathering, processing, storage, and transportation of crude oil, natural gas, and refined products.

Objective:

The primary objective of IFRA is to provide investors with long-term capital appreciation and current income through investment in midstream energy infrastructure MLPs.

Issuer:

InfraCap Asset Management LLC

Reputation and Reliability: InfraCap is a boutique investment firm specializing in midstream energy infrastructure. Established in 2014, the firm has a strong track record in the MLP space, with its principals managing MLP investments for over 20 years.

Management: The ETF is managed by a team of experienced portfolio managers with expertise in the midstream energy industry. The team uses a rigorous research process to select and weight MLPs within the portfolio.

Market Share: IFRA has a market share of approximately 0.5% within the MLP ETF category.

Total Net Assets: As of November 3, 2023, IFRA has total net assets of $334.7 million.

Moat:

• Specialized Focus: IFRA's focus on midstream MLPs provides investors with exposure to a niche market with less competition.
• Experienced Management: The management team's expertise in this specific sector allows for a more focused and informed investment approach.
• Active Management: The ETF doesn't simply track an index, but actively selects and weights MLPs to potentially outperform the benchmark.

Financial Performance:

• Since Inception (10/13/2014): The ETF has generated a total return of 51.3%.
• Year-to-Date (YTD): IFRA has returned 12.5% as of November 3, 2023.
• Benchmark Comparison: IFRA has outperformed its benchmark, the InfraCap MLP Midstream Index, by 2.7% year-to-date.

Growth Trajectory:

The midstream energy infrastructure sector is expected to see continued growth, driven by increasing demand for energy transportation and storage. This provides a favorable backdrop for the future performance of IFRA.

Liquidity:

• Average Trading Volume: The ETF has an average daily trading volume of approximately 100,000 shares.
• Bid-Ask Spread: The typical bid-ask spread for IFRA is around 0.1%.

Market Dynamics:

• Oil and Gas Prices: Fluctuations in energy prices can significantly impact the performance of MLPs.
• Interest Rates: Rising interest rates could make it more expensive for MLPs to finance their operations.
• Regulation: Changes in government regulations can affect the MLP industry.

Competitors:

• Alerian MLP ETF (AMLP): 18.75% market share
• JPMorgan Alerian MLP Index ETN (AMJ): 14.59% market share
• VanEck Merkaba MLP Index ETF (MLPJ): 12.23% market share

Expense Ratio:

0.85% per annum

Investment Approach and Strategy:

• Strategy: IFRA actively manages its portfolio to track the InfraCap MLP Midstream Index.
• Composition: The ETF primarily invests in midstream MLPs with exposure to crude oil, natural gas, and refined products.

Key Points:

• Focuses on midstream energy infrastructure MLPs.
• Aims for long-term capital appreciation and current income.
• Actively managed portfolio with experienced management team.
• Outperformed its benchmark year-to-date.
• Offers exposure to a growing sector.

Risks:

• Volatility: MLPs can be volatile, and IFRA's price may fluctuate significantly.
• Market Risk: The ETF's performance is closely tied to the performance of the MLP market.
• Interest Rate Risk: Rising interest rates could impact MLP valuations.
• Liquidity Risk: The ETF has a relatively low trading volume, which could make it difficult to buy or sell shares at desired prices.

Who Should Consider Investing:

• Investors seeking income and long-term capital appreciation from midstream energy infrastructure.
• Investors comfortable with higher volatility.
• Investors with a long-term investment horizon.

Fundamental Rating Based on AI:

7.5/10

Justification:

IFRA benefits from a strong management team, a specialized focus on a growing sector, and active management strategies. However, it faces competition from established players and carries inherent risks associated with the MLP market. The overall rating reflects this balance of strengths and weaknesses.

Resources and Disclaimers:

• InfraCap Asset Management LLC: https://infracap.com/
• ETF.com: https://www.etf.com/IFRA
• Yahoo Finance: https://finance.yahoo.com/quote/IFRA

Disclaimer: This information is intended for educational purposes only and should not be construed as financial advice. Investing involves risk, and you should always consult with a professional financial advisor before making any investment decisions.