VanEck, Yorkville ETF Advisers, LLC, and Exchange Traded Concepts LLC have completed the previously announced reorganization of two master limited partnership (MLP) exchange-traded funds, it was announced today.
Yorkville High Income MLP ETF and Yorkville High Income Infrastructure MLP ETF have been reorganized as Market Vectors High Income MLP ETF (NYSE Arca: YMLP) and Market Vectors High Income Infrastructure MLP ETF (NYSE Arca: YMLI), respectively. The funds begin trading on NYSE Arca today under their new names and will maintain their ticker symbols.
“MLPs have provided income-oriented investors exposure to the attractive yield characteristics available throughout the energy supply chain,” said Brandon Rakszawski, ETF Product Manager for VanEck. “We are pleased to expand our offerings with unique ETFs that provide exposure to high income MLPs across a range of industry segments.”
The ETFs continue to track indices that focus on high income MLPs and screen constituents based upon business activity, current yield, distribution coverage ratio, and distribution growth.
VanEck notes that an investment in YMLP and YMLI incurs risks associated with MLPs such as tax risks, limited control of management, limited rights to vote on matters affecting the MLPs, and conflict of interests between the general partner or managing member and limited partners, and risks associated with the energy sector, all of which may adversely affect the Fund.
YMLP and YMLI join VanEck’s family of energy-focused ETFs, which includes Market Vectors Oil Services ETF (NYSE Arca: OIH), Market Vectors Unconventional Oil & Gas ETF (NYSE Arca: FRAK), Market Vector Oil Refiners ETF (NYSE Arca: CRAK), Market Vectors Global Alternative Energy ETF (NYSE Arca: GEX), Market Vectors Solar Energy ETF (NYSE Arca: KWT), Market Vectors Coal ETF (NYSE Arca: KOL), and Market Vectors Uranium+Nuclear Energy ETF (NYSE Arca: NLR).
Founded in 1955, VanEck was among the first U.S. asset managers to help investors achieve greater diversification through global investing. Today, the firm continues this tradition by offering innovative investment choices in specialized asset classes such as hard assets, emerging markets, and precious metals including gold. VanEck offers a broad array of Market Vectors ETFs spanning broad-based and specialized asset classes, and is one of the largest providers of ETPs in the U.S and worldwide.
The Market Vectors High Income MLP ETF and Market Vectors High Income Infrastructure MLP ETF (the “Funds”) are the successors to the Yorkville High Income MLP ETF and Yorkville High Income Infrastructure MLP ETF, respectively, pursuant to reorganizations that took place on February 22, 2016. Prior to that date, the Funds had no investment operations. Accordingly, for periods prior to that date, any Fund performance information is that of the Yorkville High Income MLP ETF and Yorkville High Income Infrastructure MLP ETF.
The Funds are treated as regular corporations for federal income tax, which differs from most investment companies. Unlike traditional ETFs, the Funds are subject to U.S. federal income tax as well as state and local income taxes. Further, the amount of taxes currently paid by the Funds will vary depending on the amount of income, and gains derived from investments and/or sales of MLP interests and such taxes will reduce your return. A portion of the Funds’ distributions is expected to be treated as a return of capital for tax purposes. To the extent distributions represent a return of capital; an investor’s cost basis will be reduced at the time of sale potentially increasing taxes owed.
An investment in the Funds may be subject to risks which include, among others, risks specific to MLPs such as tax risks, limited control of management, limited rights to vote on matters affecting the MLPs, and conflict of interests between the general partner or managing member and limited partners, all of which may adversely affect the Funds. MLP investments can be affected by macro-economic and other factors affecting the stock market in general, expectations of interest rates, and factors affecting the energy sector and infrastructure MLP industry. The complex tax nature of MLPs may adversely affect the Funds. The Funds may defer income taxes for many years on gains attributable to their underlying MLP holdings and the deferred tax liability used to calculate the Funds’ NAV could vary dramatically from the Funds’ actual tax liability. Upon sale of an MLP security, the Funds may be liable for previously deferred taxes and, as a result, the determination of the Funds’ actual tax liability may substantially increase expenses and lower the Funds’ NAV.
Solactive indices have been licensed by Solactive AG for use by Van Eck Associates Corporation. Market Vectors ETFs are not sponsored, endorsed, issued, sold, or promoted by Solactive AG nor does this company make any representations regarding the advisability of investing in Market Vectors ETFs.
Fund shares are not individually redeemable and will be issued and redeemed at their “Net Asset Value” (NAV) only through certain authorized broker-dealers in large, specified blocks of shares called creation units and otherwise can be bought and sold only through exchange trading. Creation units are issued and redeemed principally in kind. Shares may trade at a premium or discount to their NAV in the secondary market.
Investing involves substantial risk and high volatility, including possible loss of principal. An investor should consider the investment objective, risks, charges and expenses of the Funds carefully before investing. To obtain a prospectus and summary prospectus, which contain this and other information, call 800.826.2333 or visit vaneck.com. Please read the prospectus and summary prospectus carefully before investing.
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