Are Rising Treasury Yields behind the Higher MLP Yields?
The Alerian MLP Index (AMZ) is trading at a yield of ~7.9%, which is ~5% higher than US ten-year Treasury yields. Usually, MLP yields move in the same direction as Treasury yields in the long term. MLP yields trade at a spread over Treasuries. Investors expect a premium for the additional risk that comes with MLPs compared to risk-free Treasuries.