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MLP ETF (AMLP) Hits New 52-Week High

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For investors seeking momentum, Alerian MLP ETF (AMLP - Free Report) is probably on radar. The fund just hit a 52-week high and is up 25.4% from its 52-week low price of $35.68/share.

But are more gains in store for this ETF? Let’s take a quick look at the fund and the near-term outlook on it to get a better idea of 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. The expense ratio of the ETF is 0.85%.

Why the Move?

The Master Limited Partnerships (MLPs) corner of the broad energy space has been an area to watch lately, given the rise in oil prices. MLPs represent an attractive investment option for income-focused investors as these pay out substantially all of their income to investors on a regular basis.

These have relatively consistent and predictable cash flows, making them safer and less risky than the other plays in the broader energy space. In addition to high yields and the potential for capital appreciation, MLPs also have lower volatility and provide diversification benefits to the portfolio.

More Gains Ahead?

The momentum in AMLP remains strong, given a positive weighted alpha of 13.10. There is definitely still some promise for investors who want to ride on this surging ETF.

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