uploads///mlpn returns compared to index sector and broad market

Credit Suisse’s MLPN ETN Underperformed XLE Last Week


Aug. 13 2015, Published 9:11 a.m. ET

Credit Suisse X-Links Cushing MLP Infrastructure ETN

The Credit Suisse X-Links Cushing MLP Infrastructure ETN (MLPN) fell 9.6% in the week ended August 7. In comparison, the ETRACS Alerian MLP Infrastructure Index ETN (MLPI) fell 9.7% and the JPMorgan Alerian MLP Index ETN (AMJ) fell 8.6% over the same week. The ETN underperformed broad market and energy sector ETFs in the week. The broad-market SPDR S&P 500 ETF (SPY) fell 1.2% and the Energy Select Sector SPDR ETF (XLE) fell 3.4% during the week. The fall in MLPN was due to a decline in crude oil prices during the week.

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Cushing 30 MLP Index

MLPN tracks the Cushing 30 MLP Index. The Cushing 30 MLP Index is an equal-weighted index focused on midstream MLPs. It uses a formulaic valuation methodology to rank the MLPs for inclusion in the index. The methodology focuses on financial performance instead of market capitalization. The MLPs in the index are reset to an equal weight in the fund’s portfolio every quarter.

The index only tracks midstream MLPs. It doesn’t hold upstream and downstream MLPs. Upstream and downstream MLPs are generally considered more sensitive to commodity prices. The above graph compares MLPN’s returns for the week with its underlying index, SPY, and XLE. All returns are gross dividends.

EnLink Midstream Partners (ENLK), DCP Midstream Partners (DPM), NGL Energy Partners (NGL), and Crestwood Midstream Partners (CMLP) are some of the midstream MLP constituents of the MLPX index. Together, these four MLPs form ~12.4% of the MLPX index.

Next in this series, we’ll analyze the performance of the Yorkville High Income MLP ETF (YMLP) for the week.


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