Many investors have recently looked to VettaFi’s Head-To-Head ETF Comparison Tool to compare energy infrastructure ETFs: the Alerian MLP ETF (AMLP ) and the First Trust North American Energy Infrastructure Fund (EMLP ).
While both funds offer exposure to the energy infrastructure space and boast similar tickers, the funds are very different. AMLP is best compared to the Global X MLP ETF (MLPA ), as both are structured as C-corporations. Meanwhile, EMLP has more in common with AMLP’s sister fund the Alerian Energy Infrastructure ETF (ENFR ), as both funds are RIC-compliant.
This article will explore the differences between EMLP and ENFR, as a recent article focused on the nuances between AMLP and MLPA.
EMLP is actively managed, providing exposure to U.S. and Canadian natural gas and electric utilities, corporations operating energy infrastructure assets, as well as publicly traded MLPs.
On the other hand, ENFR tracks the Alerian Midstream Energy Select Index (AMEI). ENFR’s underlying index is a composite of North American midstream energy infrastructure companies. The index includes U.S. and Canadian MLPs (25%) and corporations (75%) engaged in the pipeline transportation, storage, and processing of energy commodities.
The Performance of Energy Infrastructure ETFs Varies
EMLP’s overweight to the utilities sector has caused the fund to significantly trail ENFR on a total return basis. Nearly 33% of the First Trust fund by weight is in utilities, according to the fund’s website. Meanwhile, ENFR has no exposure to utilities.
EMLP has climbed 19.0% in the past one-year trailing July 18, while ENFR has increased 30.3%.
The performance gap is even more pronounced over a three-year period. ENFR has gained 70.9%, outpacing EMLP by nearly 2,600 basis points.
See more: AMLP and MLPA: Which MLP ETF Is Right for Your Portfolio?
EMLP is also the more expensive option, charging 96 basis points. This isn’t surprising due to it being actively managed. However, it is a steep fee compared to ENFR, which charges 35 basis points and is the lowest-cost ETF in the category.
Dividends and Income Potential
Many investors are attracted to the midstream space for the generous income offered. This makes yield an important metric when evaluating funds in the space.
ENFR’s indicative yield is 5.0% and 12-month yield is 4.8% as of July 19, according to Bloomberg. Meanwhile, EMLP’s indicative yield is 4.0% and 12-month yield is 3.5%.
For more news, information, and analysis, visit the Energy Infrastructure Channel.
vettafi.com is owned by VettaFi LLC (“VettaFi”). VettaFi is the index provider for AMLP and ENFR, for which it receives an index licensing fee. However, AMLP and ENFR are 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 AMLP and ENFR.
