ETF Launch: Bear Stearns ETF Based on MLP's (BSR, BSC)

Bear Stearns (NYSE: BSC) issued their first Exchange Traded Note (ETN) that allows investors to buy a diversified group of MLP’s (Master Limited Partnerships): the BearLinx Alerian MLP Select Index ETN on the NYSE, under the ticker symbol BSR.  The BearLinx Alerian MLP Select Index ETN (NYSE:BSR) is based on the Alerian MLP Select Index whose components are publicly listed energy MLPs engaging in the exploration, marketing, mining, processing, production, storage or transportation of any mineral or natural resource.

With 25 of the 37 components in the Alerian MLP Select Index listed on the NYSE, the BearLinx Alerian MLP Select Index ETN’s top five companies by weight include, Enterprise Product Partners (NYSE:EPD), Kinder Morgan Energy Partners (NYSE:KMP), Plains All American Pipeline Partners (NYSE:PAA), Energy Transfer Partners (NYSE:ETP) and TEPPCO (NYSE:TPP ).  Some other sizable MLP’s are Enbridge (NYSE:EEQ), Kinder Morgan Management (NYSE:KMR), Magellan Midstream (NYSE:MMP), Oneok Partners (NYSE:OKS), and more.

Alerian claims that since 1990, the market-cap weighted index of MLP’s has generated compounded annual returns over 17% with consistent annual distribution growth of 8% to 9%.  Alerian said the MLP’s have grown from $10 Billion in 1999 to $25 Billion in 2001, is nearly triple that now, and will reach $125 Billion by the end of 2008.

Jon C. Ogg
July 20, 2007

Jon Ogg can be reached at [email protected]; he does not own securities in the companies he covers.