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MLP Index Outclasses Stocks, Bonds, REITs Over Long Haul
Though it slightly trails the S&P 500 Index over the past year, the Alerian MLP Index (AMZ) has thoroughly outpaced it over the past five years, with annualized returns of 26.2 percent compared with the S&P 500’s 18.8 percent annualized returns over that period.
The MLP index, which tracks the performance of large- and mid-cap energy master limited partnerships, has performed even better when compared with the performance of utilities (14.4 percent for the S&P 500 Utilities Index) and bonds (4.9 percent for the Barclays US Aggregate Total Return Bond Index) over the past five years, and has still outpaced REITs (22.5 percent for the Real Estate 50 Index).
It performed even better compared with these indices over the past 10 years, signifying greater resilience during the global financial crisis. AMZ 10-year annualized returns are at 17.3 percent, well ahead of utilities