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Should You Invest in the InfraCap MLP ETF (AMZA)?

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If you're interested in broad exposure to the Energy - MLP segment of the U.S. equity market, look no further than the InfraCap MLP ETF (AMZA - Free Report) , a passively managed exchange traded fund launched on 10/14/2014.

Passively managed ETFs are becoming increasingly popular with institutional as well as retail investors due to their low cost, transparency, flexibility and tax efficiency. They are excellent vehicles for long term investors.

Sector ETFs are also funds of convenience, offering many ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Energy - MLP is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 12, placing it in bottom 25%.

Index Details

The fund is sponsored by Infracap Mlp Etf. It has amassed assets over $603.20 M, making it one of the larger ETFs attempting to match the performance of the Energy - MLP segment of the U.S. equity market.

This ETF is active and does not track a benchmark.

Costs

Investors should also pay attention to an ETF's expense ratio. Lower cost products will produce better results than those with a higher cost, assuming all other metrics remain the same.

Annual operating expenses for this ETF are 1.36%, making it the most expensive product in the space.

It has a 12-month trailing dividend yield of 23.83%.

Sector Exposure and Top Holdings

Even though ETFs offer diversified exposure which minimizes single stock risk, it is still important to look into a fund's holdings before investing. Luckily, most ETFs are very transparent products that disclose their holdings on a daily basis.

This ETF has heaviest allocation in the Energy sector--about 0% of the portfolio. Industrials and Materials round out the top three.

Looking at individual holdings, Mplx Lp (MPLX - Free Report) accounts for about 14.07% of total assets, followed by Energy Transfer Partners Lp and Andeavor Logistics Lp .

The top 10 holdings account for about 80.83% of total assets under management.

Performance and Risk

The ETF has lost about -4.65% and is down about -10.19% so far this year and in the past one year (as of 05/10/2018), respectively. AMZA has traded between $6.71 and $10.54 during this last 52-week period.

The ETF has a beta of 1.73 and standard deviation of 39.23% for the trailing three-year period, making it a high risk choice in the space. With about 241 holdings, it effectively diversifies company-specific risk.

Bottom Line

To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.


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