UMI - UMI: Active Midstream But Unclear If Active Helps

2024-05-23 10:47:17 ET

Summary

• The midstream segment of the energy sector offers exposure to the energy market with lower volatility and stable cashflows.
• The USCF Midstream Energy Income Fund is an active fund that aims to provide high current income and capital appreciation.
• UMI has a diversified portfolio of midstream energy companies, with a 30-Day SEC yield of 5.22% and a focus on long-term contracts.

I've written extensively about the energy sector in recent months given what I believe to be longer-term tailwinds favoring the sector. The midstream segment is particularly interesting, as this is where the infrastructure side lies. Companies here offer exposure to the energy market with often lower volatility than upstream producers or integrated majors with downstream operations. Many operate in regulated environments with stable cashflows that support healthy dividends. If energy demand continues to grow, as it is expected to, especially with the slower but steady shift towards cleaner energy sources that will require new infrastructure, this subgroup of the energy sector should do particularly well....

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