Last year I spent some time exploring small and mid-sized dividend paying Canadian energy companies that are relatively unknown to US investors. One of these companies is Inter Pipeline (OTCPK:IPPLF) -- the dominant provider of oil sands transport services. In an article at the beginning of this year, I suggested Inter Pipeline would deliver annual total returns of 20% over the next 5 years and predicted these returns would be front-end loaded. Year-to-date the stock is up ~30%, yet still yields 3.9%.
Several recent catalysts have improved the company's outlook and the potential for continued growth in FFO and dividends:
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Completion of the Polaris
Investments focusing on master limited partnerships (or MLPs) have performed very well recently. Many have seen double-digit returns year-to-date, and a few are even north of 20%. As a result of the popularity boom of MLPs as an investment, we've seen a number of vehicles in the ETF space popping up. Many are still building up their asset bases, so the limited tradability, coupled with the more volatile nature of MLPs in general makes these types of investments higher-risk.
However, it's still possible to achieve a high return or high yield with below-average risk. A lot of these ETFs are young, and getting reliable risk data on them can be a bit of a challenge, but looking at available data, the composition of the portfolio, and the type of index they're trying to benchmark can all give us clues as to which ones will be more conservative than the