Global X Funds has just launched a new exchange-traded fund (ETF) that brings exposure to master limited partnerships (MLPs) and to midstream energy infrastructure companies. The Global X MLP & Energy Infrastructure ETF (NYSEMKT: MLPX) is being launched as the low-cost ETF in this effort with only a 0.45% management fee. Its benchmark and tracking index is the Solactive MLP & Energy Infrastructure Index.

As a regulated investment company, the MLPX ETF is said to not be subject to corporate taxes, while still giving access to the popular MLP sector. The fund also gives investors the advantage of not requiring K-1 tax filings from investors. The tax forms will be 1099s. Many investors have piled into the MLP sector because of high-yield distributions, which act like dividends but are actually distributions, as some of the distributions are considered a return of capital and some treated as income.

The ETF launch shows that its investors can benefit from the industry’s toll-road business model, which directly correlates with volume as opposed to commodity pricing. The Solactive MLP & Energy Infrastructure Index currently consists of 35 holdings, and this fund is expected to pay quarterly income distributions

As a reminder, the Global X suite of MLP ETFs includes the Global X MLP ETF (NYSEMKT: MLPA), targeting the 30 largest MLPs, and the Global X Junior MLP ETF (NYSEMKT: MLPJ) targeting the small-cap segment of the MLP market. The graphic below shows you a listing of the index components:

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