If the economy continues to show strength and if some infrastructure or other types of policy changes occur, it could help the industrial sector.
Two master limited partnership exchange-traded products following the Alerian MLP Infrastructure Index have the worst showing year-to-date for mid caps, underscoring the issues in the energy market. The Alerian MLP ETF (AMLP) and the UBS E-TRACS Alerian MLP Infrastructure exchange-traded note (MLPI) are both down double digits so far, down 11.75 percent and 13.23 percent, respectively.
The Alerian MLP Infrastructure Index is a capped, float-adjusted, capitalization-weighted composite of energy infrastructure companies that earn most of their cash flow from the transportation, storage and processing of energy commodities. AMLP has $9.12 billion in AUM, with a 1.42 basis point expense ratio. MLPI is smaller, with $2.1 billion in AUM and an expense ratio of 85 basis points.
Even though most MLP fund managers will argue that these investments should not be heavily influenced by crude-oil prices, indiscriminate selling in the oil sector because of overproduction by the Organization of Petroleum Exporting countries and U.S. shale-oil producers weighs on MLPs.