Energy ETFs: MLPX Delivers More Income, Lower Fees

The Global X - MLP & Energy Infrastructure ETF (NYSEMKT:MLPX) provides a lower-cost, high-yield alternative to the VanEck Uranium and Nuclear ETF (NYSEMKT:NLR), which focuses on growth-oriented nuclear power and mining companies.

Investors seeking energy sector exposure often choose between stable income and thematic growth. These two funds represent distinct corners of the market: the steady midstream infrastructure of master limited partnerships versus the specialized, high-growth potential of the global nuclear power industry and uranium mining companies. This analysis examines how their underlying strategies and risk profiles differ.

Snapshot (cost & size)

Beta measures price volatility relative to the S&P 500; beta is calculated from five-year monthly returns. The 1-yr return represents total return over the trailing 12 months. Dividend yield is the trailing-12-month distribution yield.

With an expense ratio of 0.45%, the Global X fund is slightly more affordable than the VanEck fund. Income-focused investors may prefer the Global X fund for its 4.20% distribution yield, which significantly outpaces the 2.40% yield of its nuclear-focused peer.

Performance & risk comparison

What's inside

The Global X - MLP & Energy Infrastructure ETF (NYSEMKT:MLPX) concentrates almost entirely on the energy sector at 99.00%, specifically targeting midstream companies and master limited partnerships. This fund tracks a Solactive index of infrastructure providers, holds 30 positions, and was launched in 2013. Its largest positions include TC Energy (NYSE:TRP) at 8.54%, Enbridge (NYSE:ENB) at 8.50%, and Williams Cos (NYSE:WMB) at 8.03%. The fund has a trailing-12-month dividend of $3.04 per share and manages $3.5 billion in assets under management (AUM).

In contrast, the VanEck Uranium and Nuclear ETF (NYSEMKT:NLR) is more diversified across sectors, with 46.00% in energy, 37.00% in utilities, and 15.00% in industrials. This older fund, launched in 2007, and holds 29 positions. Its top holdings include Constellation Energy (NASDAQ:CEG) at 8.07%, Cameco (NYSE:CCJ) at 8.07%, and BWX Technologies (NYSE:BWXT) at 6.46%. It paid $3.17 per share over the trailing 12 months and manages $4.9 billion in AUM.

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Which looks like the better buy

The Global X - MLP & Energy Infrastructure ETF (MLPX) and the VanEck Uranium and Nuclear ETF (NLR) are both energy sector exchange-traded funds (ETFs). Here’s how they match up with one another.

First, there’s MLPX. This fund focuses on midstream energy companies. These are the companies that transport, store, and process energy products such as crude oil and natural gas. Top holdings for the fund include Kinder Morgan (NYSE:KMI), Enterprise Products Partners (NYSE:EPD), and Energy Transfer (NYSE:ET). Income-seeking investors will appreciate the fund’s stout 4.1% dividend yield. However, the fund’s expense ratio of 0.45% might be higher than some cost-conscious investors would prefer.

Then, there’s NLR. This fund focuses on the nuclear energy sub-sector. Its top holdings include Oklo (NYSE:OKLO) and NuScale Power (NYSE:SMR). NLR has an expense ratio of 0.52% and a dividend yield of 2.3%.

As for performance, NLR has been the clear winner over the last five years. Since 2021, NLR has delivered a total return of 146%, equating to a compound annual growth rate (CAGR) of 19.7%. MLPX, meanwhile, has posted a total return of 106%, with a CAGR of 15.5%. Both funds have bested the S&P 500, which has recorded a total return of 80% over this same period, with a CAGR of 12.5%.

In summary, both funds have performed well. Strictly income-focused investors may prefer MLPX given its much higher dividend yield. However, those with a keen interest in the nuclear subsector, or simply those who prefer growth to value, may prefer NLR given its better long-term track record.

Jake Lerch has positions in Enterprise Products Partners. The Motley Fool has positions in and recommends BWX Technologies, Cameco, Constellation Energy, Enbridge, and Kinder Morgan. The Motley Fool recommends Enterprise Products Partners, NuScale Power, and Tc Energy. The Motley Fool has a disclosure policy.