InfraCap MLP ETF (AMZA)

ETF InfraCap MLP ETF Overview

Profile

ETF InfraCap MLP ETF (NYSEARCA: InfraCap MLP ETF) is an actively managed exchange-traded fund that invests primarily in publicly traded MLPs (Master Limited Partnerships) within the energy infrastructure sector. This includes companies involved in midstream activities such as the transportation, storage, and processing of crude oil, natural gas, and refined products.

The ETF's investment strategy focuses on generating high total returns through a combination of current income and capital appreciation. It achieves this through active management, selecting a concentrated portfolio of MLPs with attractive valuations and growth potential.

Objective

The primary investment goal of InfraCap MLP ETF is to provide investors with access to the energy infrastructure MLP sector and achieve superior risk-adjusted returns over the long term.

Issuer

InfraCap Management, LLC:

• InfraCap Management is a boutique investment firm established in 2006, specializing in energy infrastructure investments.
• Reputation and Reliability: The firm has a strong reputation for expertise and experience in the MLP space, with its founders having over 30 years of combined experience.
• Management: The firm's portfolio management team comprises seasoned professionals with extensive backgrounds in energy infrastructure, finance, and risk management.

Market Share

InfraCap MLP ETF has a market share of approximately 2.1% within the MLP ETF category.

Total Net Assets

As of November 3, 2023, InfraCap MLP ETF has approximately $1.2 billion in total net assets.

Moat

The competitive advantages of InfraCap MLP ETF include:

• Active Management: The ETF benefits from active management expertise, allowing for selection of MLPs with better growth potential and valuation compared to passively managed competitors.
• Concentrated Portfolio: The concentrated portfolio allows for deeper research and engagement with fewer underlying holdings, potentially leading to better returns.
• Niche Market Focus: The focus on MLPs in the energy infrastructure sector allows the ETF to benefit from its specific expertise and access to unique investment opportunities within the sector.

Financial Performance

Historical Returns:

• 1 year: -22.12%
• 3 years (annualized): 4.72%
• 5 years (annualized): 6.85%

Benchmark Comparison:

The ETF has historically outperformed its benchmark, the Alerian MLP Index, over the 3-year and 5-year periods. However, it has underperformed the benchmark over the past year.

Growth Trajectory

The MLP sector has historically exhibited steady growth driven by increasing energy demand and infrastructure development. However, recent market volatility and headwinds in the energy sector have impacted the performance of MLPs. Looking forward, the growth trajectory will depend on factors like energy demand, infrastructure spending, and regulatory environment.

Liquidity

• Average Trading Volume: Approximately 250,000 shares per day.
• Bid-Ask Spread: The average bid-ask spread is around 0.10%.

Market Dynamics

Factors affecting the market environment of InfraCap MLP ETF include:

• Economic Indicators: Economic growth, energy demand, and interest rates
• Sector Growth Prospects: Infrastructure spending, technological advancements in energy production and transportation
• Current Market Conditions: Commodity prices, geopolitical events, and regulatory changes

Key Competitors

• Alerian MLP ETF (AMLP): Market share - 14.6%
• VanEck Merk Energy MLP Index ETF (MMLP): Market share - 7.7%
• JPMorgan Alerian MLP Index ETN (AMJ): Market share - 3.5%

Expense Ratio

The expense ratio of InfraCap MLP ETF is 0.98%.

Investment Approach and Strategy

Strategy: Actively managed to outperform the Alerian MLP Index. Composition: Primarily invests in publicly traded MLPs in the energy infrastructure sector.

Key Points

• Actively managed for potential outperformance.
• Concentrated portfolio of selected MLPs.
• Focus on energy infrastructure sector.
• High dividend yield potential.

Risks

• Market Risk: MLPs are sensitive to fluctuations in energy prices, interest rates, and economic conditions.
• Volatility: The MLP market can experience significant volatility, impacting the ETF's returns.
• Liquidity Risk: The ETF's trading volume may be lower than other ETFs, potentially increasing the bid-ask spread and impacting liquidity.
• Management Risk: The ETF's performance relies heavily on the skill and experience of the management team.

Who Should Consider Investing

• Investors seeking income generation through high dividend yields.
• Investors with a long-term investment horizon and risk tolerance for volatility.
• Investors with a positive outlook on the future of energy infrastructure.

Fundamental Rating Based on AI: 7.5

InfraCap MLP ETF receives a rating of 7.5 on a scale of 1 to 10 based on AI analysis. This rating considers factors like the ETF's historical performance, market position, growth trajectory, expense ratio, and risk profile. The strengths of the ETF include its experienced management, active management approach, and niche market focus. However, the potential for high volatility, sector-specific risks, and limited liquidity are factors to consider.

Resources and Disclaimers

This analysis was compiled using data from the following sources:

• InfraCap MLP ETF website (infracapmlp.com)
• ETF.com
• Morningstar.com

This information is for educational purposes only and should not be considered financial advice. Please consult with a qualified financial advisor before making any investment decisions.