As energy assets bounce back, income-starved investors may want to revisit master limited partnerships (MLP) and the
MLPA seeks to replicate a benchmark that offers exposure the overall performance of the United States master limited partnerships (MLP) asset class. MLPs have become very popular in recent years for primarily two reasons: (1) required quarterly distributions provide a steady stream of current income, and (2) because they are partnerships, MLPs avoid corporate income taxes at both the federal and state level as the the tax liability is passed through to the individual partners.
MLPs primarily deal with the distribution and storage of energy products, so their business model is less reliant on the commodities market. MLPs profit off the quantity of oil and natural gas they are able to move around. Consequently, they have historically shown a weaker correlation to energy prices over longer periods as the investment vehicle acts more like an energy toll road, profiting
The Globe and Mail Contributed to The Globe and Mail Published March 12, 2021 Bookmark Please log in to listen to this story. Also available in French and Mandarin. Log In Create Free Account
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At the end of February, the Canadian ETF Industry reached a new record high of $270 billion in assets under management. The number of ETFs listed in Canada continues to grow as we welcomed the world’s first bitcoin ETF.
Once more, Canadian regulators prove to be more accepting of disruptive investment products. In the U.S, approximately 10 Bitcoin ETFs have either been rejected or are still waiting approval by the SEC. Will the success of the Canadian-listed Bitcoin ETFs pave the way for our U.S. counterparts?
March 11, 2021
Investors should explore both digital currencies and gold as both assets can be incorporated into a diversified portfolio.
In the recent webcast,
Gold and Crypto: There’s Room in Your Portfolio For Both, Frank Holmes, CEO and Chief Investment Officer, U.S. Global Investors, touched upon headline news that is predicting cryptocurrency assets like Bitcoin will completely replace gold as a safe haven asset. However, there is room in a portfolio for both.
Cryptocurrencies like Ethereum and Bitcoin have enjoyed a spectacular year, with ETH up 1,294% since the start of 2020 and Bitcoin up 624% as well. The recent gains come after cryptocurrencies lost momentum and pared losses from two years of sideways trading over 2018 and 2019.
Higher oil prices are providing the necessary tailwinds for an energy rally and there’s no stopping the party yet. The U.S. Energy Information Administration just upped the ante on its forecast for oil prices this year.
“The U.S. Energy Information Administration raised 2021 forecasts for U.S. and global benchmark oil prices in a monthly report Tuesday, pointing out that the recent decision by major oil producers to extend existing supply cuts through April have provided support for prices in the near term,” a MarketWatch report noted.
“The EIA boosted its 2021 West Texas Intermediate crude price forecast to $57.24 a barrel, up 14% from the January forecast,” the report added further. “It expects 2022 prices to average $54.75, up 6.2% from the previous forecast. For Brent crude, it also lifted this year’s forecast by 14% to $60.67 and next year’s by 6% to $58.51.”