AMLP: Attractive Inflation Hedge With An 8.5% Dividend

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Following the strong recent performance in precious metals, I have been searching for new areas to invest that fit into my general "long inflation" investment theme. One key area of growing interest is the energy sector as a whole, most notably the downtrodden industries such as uranium, oil, and natural gas.
After the attack on Saudi Aramco's oil pipelines, I wrote an article called "XOP: Long-Term Bottom May Be In" that details my overall bullish view on oil and how I think the long-term bottom for the energy sector may be in.
The problem with most energy stocks and the underlying commodities is that they do not generate any income for investors. Many of these companies barely breakeven today and have been struggling with insolvency for quite some time. One area where very high-income distributions can be found is in the MLP space.
I'd like to focus this article on the popular Alerian MLP ETF (AMLP). The fund invests primarily (75% of assets) in pipeline transportation MLPs and the other quarter in natural gas processing and gathering.
The risk factors facing such MLPs are more complicated than those facing traditional energy producers. Low energy commodity prices do not directly harm MLPs, but indirectly do so because lower prices usually cause lower production (MLPs earn a fee for transporting/processing). Even more, the companies managing MLPs often don't act in MLP unitholder's best interest and conflicts of interest occasionally... Read more