I wrote an article last December about how to use Master Limited Partnerships (MLPs) to spice up your portfolio. At that time, many of the MLP Closed End Funds (CEFs) were selling at a premium due to their excellent performance in a low interest rate environment. However, this summer interest rates concerns caused these assets to be hit hard and many of the premiums evaporated. Currently, many of the MLP CEFs are selling at a discount, which renewed my interest in these assets. To determine if this is a buying opportunity, I evaluated these CEFs in terms of reward versus risk over the last several years.
For those who have not read my previous article, I will summarize some of the unique aspects of MLPs. This will be a high-level overview since I am not qualified to cover all the tax-related nuances of MLP investing.
MLPs have relatively complex rules
Master Limited Partnerships are increasingly in focus as organic distribution growth coupled with yield compression has provided investors with double-digit, tax-deferred, total returns over the past 24 months. However, there is often the conditional warning of dark clouds on the horizon for MLPs, and one such risk is a potential change in tax policy, which may impact the ability for partnerships to distribute cash to investors. This article updates investors with the latest public comments from the Senate Finance Committee and Internal Revenue Service to assess the level of risk associated with such a change.
First, a brief primer on Master Limited Partnerships, which are energy oriented "pass-through" entities where no tax is paid at the partnership level and partnership income passes through and is taxed only at one level, the individual partner or unitholder. Since deductions such as depreciation and depletion are also passed through to individual partners, the
By Maria Halmo
What does it mean that Enterprise (NYSE:EPD) is the largest MLP? How much larger is it? What's the next largest? And the one after that? How much impact do newer MLPs have on the size of the space? Sometimes, numbers alone aren't the easiest to understand and all we can see is the code.
This month, we decided to take a basic treemap  of all 116 MLPs , sorted by market capitalization , and color code it to show various aspects of the MLP space. The two smallest, Oxford Resource Partners (NYSE:OXF) and Central Energy Partners (ENGY), have such small market capitalizations  that even at the highest resolution, it is difficult to distinguish them in the lower right hand-corner. But they are there.
Kinder Morgan and Enterprise Products Partners are frequently cited as the two largest MLPs, but it doesn't look like this on