The lowest-cost ETF in the energy infrastructure category has reached a significant trading milestone.
The Alerian Energy Infrastructure ETF (ENFR ) crossed $200 million in assets under management on Wednesday, ending the day with $204 million. The energy infrastructure ETF has seen strong flows and price appreciation in recent months.
See more: Midstream Energy ETFs Recorded Strong Flows in September
ENFR, which charges 35 basis points, provides exposure to the Alerian Midstream Energy Select Index (AMEI). The index is a composite of North American energy infrastructure companies, including C-corps and MLPs. Midstream companies transport, process, and store hydrocarbons, a crucial role that generates predictable fee-based revenue.
The fund has generated strong returns for investors, handily outpacing broader energy in 2024. The midstream segment has performed well in 2024 despite weak oil prices and energy sentiment for much of this year. Midstream is less sensitive to moves in commodity prices compared to other sectors of energy, given midstream companies’ fee-based business models, which support stable cash flows.
ENFR has climbed 38.7% year to date through Nov. 6. while broader energy, measured by the Energy Select Sector SPDR Fund (XLE ), is up 14.3%.
Many investors are attracted to energy infrastructure ETFs for their history of providing compelling income and returns. ENFR’s 30-day SEC yield is 4.7% as of Oct. 31.
Midstream can offer generous income regardless of the interest rate environment, making it a compelling option during the Fed’s rate-cutting cycle.
Additionally, an energy infrastructure ETF can serve as a diversifier in portfolios. MLPs, which account for 25% of ENFR’s underlying index, aren’t typically in broad market indexes. Although midstream C-corps are eligible for inclusion in the S&P 500, just four names are currently in the broad index.
For more news, information, and analysis, visit the Energy Infrastructure Channel.
VettaFi LLC (“VettaFi”) is the index provider for ENFR, for which it receives an index licensing fee. However, ENFR is not issued, sponsored, endorsed or sold by VettaFi, and VettaFi has no obligation or liability in connection with the issuance, administration, marketing or trading of ENFR.
