AMZ Anniversary Countdown: 2013

AMZ Total Return: 27.6%
Annualized Standard Deviation: 13.2%
Average Yield: 5.9%
Average Spread to Treasuries: 357 basis points
Top AMZ Performer: EnLink Midstream Partners (ENLK)
Bottom AMZ Performer: EV Energy Partners (EVEP)
Median AMZ Daily Liquidity: $936 million

In 2013, the energy renaissance was in full swing, with infrastructure projects being announced left and right. While the AMZ posted a strong 27.6% total return in 2013, it still couldn’t compare to the S&P500’s return of 32.4%.

The acronym “CBR” began to increase in popularity, though not to be overshadowed by the term “virtual pipeline,” coined by Global Partners (GLP) in a January press release, to describe a network of rail tanker cars and related rail terminal facilities.

In late May, Federal Reserve Chairman Ben Bernanke announced that the Fed could begin tapering back its bond purchases, thereby ending the golden age of quantitative easing. The “could” became a reality shortly thereafter, triggering a “taper tantrum” for several months in the global markets and anything with a yield—like MLPs. The AMZ fell 7.7% from May 22nd until September 4th and began to recover thereafter, though not quite able to end the year at pre-taper levels.

Despite continued macroeconomic volatility, 2013 marked a stellar year for MLP financing. Over $29 billion was raised across 90 follow-on public equity offerings and IPOs, setting a record both in total amount raised and number of financing deals in a year.

More notable offerings include: the $150 million preferred offering from Teekay Offshore Partners (TOO) in April, the first public MLP preferred offering; the Plains GP Holdings (PAGP) IPO, which structured itself as an Up-C partnership; and Cheniere Energy Partners LP Holdings (CQH), the first subordinated unit MLP offering since NSP, the Natural Resource Partners (NRP) subordinate unit MLP that went public in August 2005.

2013

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