For investors looking for momentum, Alerian MLP ETF (AMLP Quick QuoteAMLP - Free Report) is probably a suitable pick. The fund just hit a 52-week high and is up about 95% from its 52-week low price of $18.93/share.

Let’s take a look at the fund and its near-term outlook to gain an insight into where it might be headed:

AMLP in Focus

The underlying Alerian MLP Infrastructure Index is capped, float-adjusted, capitalization-weighted composite of energy infrastructure Master Limited Partnerships that earn the majority of their cash flow from the transportation, storage, and processing of energy commodities. It charges 90 basis points in annual fees (see all Energy ETFs here).

Why the Move?

Oil prices have been hovering around the 2018-level on hopes of demand recovery. Analysts are expecting a recovery in oil demand this year as growing vaccination, reopening of economies and summers will help in pulling it up.

Fitch Ratings expects the operating environment for the North American midstream sector to improve in 2021, thanks to recovering U.S. and Canadian oil & gas production helped by marginally higher prices. If this was not enough, lower capex budgets have boosted cash flow profiles and Fitch expects 2021 median FCF for midstream to be positive.

More Gains Ahead?

It seems like the fund will remain strong in the near term, with a positive weighted alpha of 71.04, which gives cues of further rally. Operating backdrop is also in favor of the fund.

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