Sébastien Bischeri
Sunshine Profits
Let’s focus on less-popular securities to trade energies today: Master Limited Partnership (MLP). How do they work and how can they be profitable?
By the way, a big “thank you!” goes to Simon, one of our readers, who asked us about this last Friday. Feel free to send us your questions or any topics that you would like us to write about in the forthcoming editions, and we’ll try our best to answer them!
Note: Trading positions are available to our premium subscribers.
A good way to diversify the construction of your oil and gas investment portfolio is to use a variety of assets for balanced exposure to the energy sector and its industrial components.
What is a Master Limited Partnership (MLP)?
To learn in detail what a MLP is, we invite you to read the following articles that already contain the necessary basic information you need to know before starting investing in them.
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Master Limited Partnership (MLP), Investopedia.com.
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The Benefits of Master Limited Partnerships, Investopedia.com.
Key reason for going into those alternative investments
The most important advantage is the high-income potential. Indeed, Master Limited Partnerships (MLPs) typically pay high yields to investors, mainly due to the fact that they do not pay corporate income taxes.
Stock watchlist (Continued)
In the first article about alternative investments, we started a watchlist with some major energy stocks. Today, let’s update it!
As usual, our stock-picks will be shared through this link to our dynamic watchlist (which will be included in the position from now on). It will be updated from time to time as we progress through our portfolio construction process.
Take a look below at a few examples of some indicative metrics:
Today we picked five oil and gas Master Limited Partnership (MLP) companies that are quoted on the US exchange. Their revenues are as stated below:
Revenue (in billion US dollars):
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Enterprise Products Partners LP (EPD) $26.67B.
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Energy Transfer LP (ET) $38.95B.
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Magellan Midstream Partners LP (MMP) $2.37B.
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MPLX LP (MPLX) $8.51B.
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Plains All American Pipeline LP (PAA) $23.59B.
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All essays, research and information found above represent analyses and opinions of Przemyslaw Radomski, CFA and Sunshine Profits' employees and associates only. As such, it may prove wrong and be a subject to change without notice. Opinions and analyses were based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are believed to be accurate, Przemyslaw Radomski, CFA and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. Radomski is not a Registered Securities Advisor. By reading Przemyslaw Radomski's, CFA reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Przemyslaw Radomski, CFA, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.
Editors’ Picks
EUR/USD trims gains, back below 1.1800
EUR/USD now loses some upside momentum, returning to the area below the 1.1800 support as the Greenback manages to regain some composure following the SCOTUS-led pullback earlier in the session.
GBP/USD off highs, recedes to the sub-1.3500 area
Following earlier highs north of 1.3500 the figure, GBP/USD now faces some renewed downside pressure, revisiting the 1.3490 zone as the US Dollar manages to regain some upside impulse in the latter part of the NA session on Friday.
USD/JPY sticks to gains above 155.00, over one-week top ahead of US data
The USD/JPY pair gains positive traction for the third straight day and climbs to over a one-week top, around the 155.35-155.40 region. Data released early today showed that Japan’s key inflation gauge eased to the slowest pace in two years, tempering expectations for an immediate policy tightening by the Bank of Japan.
Editors’ Picks
EUR/USD: US Dollar comeback in the makes? Premium
The US Dollar (USD) stands victorious at the end of another week, with the EUR/USD pair trading near a four-week low of 1.1742, while the USD retains its strength despite some discouraging American data released at the end of the week.
Gold: Escalating geopolitical tensions help limit losses Premium
Gold (XAU/USD) struggled to make a decisive move in either direction this week as it quickly recovered above $5,000 after posting losses on Monday and Tuesday.
GBP/USD: Pound Sterling braces for more pain, as 200-day SMA tested Premium
The Pound Sterling (GBP) crashed to its lowest level in a month against the US Dollar (USD), as critical support levels were breached in a data-packed week.
Bitcoin: No recovery in sight
Bitcoin (BTC) price continues to trade within a range-bound zone, hovering around $67,000 at the time of writing on Friday, and falling slightly so far this week, with no signs of recovery.
US Dollar: Tariffed. Now What? Premium
The US Dollar (USD) reversed its previous week’s decline, managing to stage a meaningful rebound and retesting the area just above the 98.00 barrier when tracked by the US Dollar Index (DXY).
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