subject: Describe Briefly The History Of The Alerian Mlp Index [print this page] A market index reflects the true picture of the stock market and is considered the benchmark to compare its growth with individual stocks, which are being traded in the market. This index value also helps to track the market's changes over time.
The Alerian MLP index or AMZ is a critical index of the Master Limited Partnership structure. Alerian was founded in 2004 by Gabriel Hammond as an MLP asset manager. The index came into existence on June 6, 2006, when JP Morgan formally announced its operation. The corresponding total return index will be disseminated everyday through ticker AMZX and is present on Alerians website. In addition, S&P calculates 10 years of historical index data on both a charge and total return basis.
The Alerian MLP Index maintains the following indices:-
Alerian MLP Index
Alerian MLP Infrastructure Index
Alerian Natural Gas MLP Index
Alerian Large Cap MLP Index
50 of the most distinguished energy master limited partnerships get together to form the the Alerian MLP index. Its index value is calculated by S&P by using a float-adjusted market capitalization methodology. The index is propagated by the NYSE real-time on a price return basis (NYSE: AMZ). The corresponding total return index is calculated and dissipated on a daily basis through the Amex Major Market Index ticker.
The Alerian MLP Infrastructure Index is comprised of 25 energy infrastructure Master Limited Partnerships. It is a liquid, midstream-focused subset of the Alerian MLP Index. Transportation, storage and processing of energy commodities generates majority of the cash flow in this particular index.
A total of 15 equal-weighted natural gas infrastructure Master Limited Partnerships get together to form the Alerian Natural Gas MLP Index . Majority of the cash flow in this index comes from the transportation, storage, and processing of natural gas and natural gas liquids and it provides the investors with an unbiased benchmark for the infrastructure element of the natural gas industry.
In the end there is the Alerian Large Cap MLP Index. It is an equal-weighted mixture of 15 of the largest energy Master Limited Partnerships by market capitalization. The index is dispersed every day on a price-return basis via the ticker, ALCI. Its total-return basis is calculated through the ticker, ALCIX.
In this type of market, the index rebalancing is separated into two groups.
Quarterly rebalancing
Special rebalancing
Quarterly rebalancing takes place on the third Friday of every March, June, September, and December. This is influential from the next day of trading. The rebalancing takes place after market close on the instant preceding trading day when the major US exchanges are closed on the third Friday of March, June, September, and December.
Corporate actions trigger the phenomenon of special rebalancing. It takes place after market close on the last trading day for an contemporaneous element. Corporate actions include
Mergers of two constituents
Delisting
Bankruptcies
Historical index data of over 14 years on both a price and total return basis is available starting from December 31, 1995. Alerian also publishes relevant constituent data points such as index component weightings, total sector market capitalization, and dividend yield.
