Alerian, a North American energy infrastructure index and research provider, has announced it will launch its debut ETF via the HANetf white-label platform.
The Alerian Midstream Energy Dividend UCITS ETF (MMLP) will offer exposure to energy infrastructure companies, which generate fees by transporting, processing and storing oil, natural gas and natural gas liquids, and is benchmarked against the Alerian Midstream Energy Dividend index.
The index has a five-year average yield of 7.25%, and currently offers a yield of 10.36% as of 30 June 2020, which is higher than the FTSE 100 TR index's current yield of 4.42%, and is comprised of over 80% investment grade credit ratings.
MMLP will list on the London Stock Exchange this month in both a USD and GBP denominated product, and is domiciled in Ireland.
It launches with 31 holdings and has a total expense ratio of 0.4%.
David LaValle, CEO at Alerian, said: "The launch of MMLP demonstrates European investors' interest in exposure to North American midstream energy infrastructure.
"We are excited about our partnership with HANetf and our joint innovation to answer investors' call for yield and income."
Hector McNeil, co-CEO of HANetf, added: "We are excited to bring MMLP to European investors who are in desperate need of more high-yielding and stable income streams.
"MMLP is the first and currently only UCITS ETF that embeds the expertise, coverage and classification of the world leader in this sector - Alerian.
"The North American energy infrastructure market represents a favourable investment opportunity. With the onset of the coronavirus crisis and the recent collapse in energy prices to levels never seen before, midstream energy companies have been trading at historically big discounts.
"With the expectation that the global economy will gradually lift lockdown restrictions and reopen for business, and as shale production and energy demand recover to pre-crisis levels, midstream energy companies offer an attractive risk-return opportunity to investors. MMLP will be an excellent way to invest in that opportunity."